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Tag: lachlan murdoch

  • How Rupert Murdoch’s Retirement Protected Lachlan’s Perch

    How Rupert Murdoch’s Retirement Protected Lachlan’s Perch

    One of the pleasures of watching the final season of HBO’s media dynasty drama Succession was knowing that the Murdochs were obsessed with the show even as they professed not to watch it. In my May Vanity Fair cover story about the Murdochs—the inspiration for the fictional Roy clan—I reported that Rupert Murdoch’s divorce settlement with his fourth wife Jerry Hall mandated that Hall couldn’t give story ideas to the Succession writers. “Rupert and Lachlan hated the show,” a person close to the family told me.

    Which is why it’s deliciously ironic that Rupert’s decision to retire last month and elevate his eldest son Lachlan to the throne was made to avoid the chaos that played out on Succession’s final season. Spoiler alert: In the acclaimed third episode, patriarch Logan Roy dies suddenly on his private jet without having named a successor. In a document found in Logan’s safe about who should take over, his second eldest son Kendall’s name is either underlined or crossed out, depending on how you interpreted the handwriting. The ambiguity creates a power vacuum that paralyzes the family and the company.

    According to three sources close to the Murdochs, Rupert and Lachlan agreed Rupert should retire while he was alive to avoid a messy transfer of power as befell the Roys. “Lachlan’s message to Rupert was: You could drop dead on the job! There has to be a plan in place now,” said one of the sources briefed on the conversations. “Lachlan didn’t want his father to go, but it was more like, How long are we going to pretend you’re immortal?” As I’ve previously reported, Rupert’s health was buffeted by crises. In recent years, he was secretly hospitalized for a broken back, seizures, two bouts of pneumonia, atrial fibrillation, a torn Achilles tendon, and COVID-19.

    According to the second source close to the family, Rupert first broached the idea of retirement to Lachlan two years ago. Since then, the two have had long conversations about the timing of the decision. The source added that Lachlan did not pressure Rupert to go. Rupert told Lachlan he wanted to step down before this year’s annual shareholder meeting. None of my sources said the decision was made because Lachlan and Rupert were reacting to the Succession plotline. “It’s more of a case where truth is stranger than fiction,” the first source said.

    By retiring while still alive, Rupert has solidified his chosen heir’s place on the throne—for now. It’s harder to remove Lachlan when he’s been officially anointed by Rupert. But the ultimate future of the media empire will be decided by Rupert’s four adult children from his first and second marriages. As I’ve previously reported, Lachlan’s younger brother James wants Fox News to become a centrist and fact-based news network after Rupert’s death. But to topple Lachlan, James will need his older sisters Elisabeth and Prudence to support him. It’s too early to tell which way their votes would go. For now, at least, Lachlan is in charge.

    A spokesperson for Fox Corp declined to comment.

    Gabriel Sherman

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  • CNBC Daily Open: Dispelling the AI hallucination

    CNBC Daily Open: Dispelling the AI hallucination

    Signage for Nvidia Corp. during the Taipei Computex expo in Taipei, Taiwan, on Tuesday, May 30, 2023.

    Hwa Cheng | Bloomberg | Getty Images

    This report is from today’s CNBC Daily Open, our new, international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

    What you need to know today

    Infectious pessimism
    U.S. stocks fell for a third consecutive day as Treasury yields continued rising to multiyear highs. The pan-European Stoxx 600 slumped 1.3% amid a flurry of central bank decisions. Sweden hiked rates by 25 basis points to 4%; Norway raised its rate from 4% to 4.25%; Switzerland kept rates unchanged. For more central bank decisions, see below.

    A halt and a big hike
    The Bank of England elected to keep interest rates unchanged at its September meeting, breaking a series of 14 straight rate hikes. But the decision wasn’t unanimous: Four out of nine members voted for another 25-basis-point hike to 5.5%. In other central bank news, Turkey hiked its interest rate to 30%, a 5-percentage-point jump from 25%.

    Securing business and the internet
    Cisco is acquiring Splunk, a cybersecurity software company, for $157 a share in a cash deal. The total deal’s worth $28 billion — about 13% of Cisco’s market capitalization — making it the company’s largest acquisition ever. Cisco’s known for making computer networking equipment, but has been boosting its cybersecurity business recently to grow its revenue stream.

    Succession
    Rupert Murdoch is stepping down as chairman of the board of Fox Corp and News Corp in November. The 92-year-old will be succeeded by his son Lachlan Murdoch. Fox Corp is the parent company of Fox News, a TV channel embroiled in a $787.5 million settlement this year over false claims that Dominion Voting Systems’ machines swayed the 2020 U.S. presidential election.

    [PRO] ‘Uninvestable’ banking sector
    Steve Eisman, the investor who called — and profited from — the subprime mortgage crisis that began in 2007, thinks “the whole bank sector is uninvestable.” Silicon Valley Bank collapsed in March this year, sparking panic and causing depositors to withdraw money at other regional banks. But that’s not the only risk to banks weighing on Eisman’s mind.

    The bottom line

    Four months after hype over artificial intelligence fired up markets, the rally’s starting to look more like a hallucination — a confident but false claim AI models are prone to making.

    For evidence, look no further than Nvidia, the spark that ignited the whole blaze. Shares of the chipmaker peaked on Aug. 24 and have tumbled 18.4% since. While it’s true Nvidia’s still up 181% for the entire year, that’s 60 percentage points lower than its August peak, when shares were 244% higher.

    Microsoft’s announcement of a broad rollout of Copilot — the company’s AI tool — to corporate clients didn’t stoke excitement. On the contrary, Microsoft shares dipped 0.39% after the company’s event. By contrast, recall how share prices popped to a record in May after the company announced the pricing of the Copilot subscription service.

    And Arm, which tried to position itself as integral to AI computing, saw its shares descend to Earth after rocketing on the first day of its initial public offering. After dropping almost 1% in extended trading, the share’s around $51.60 a piece — just 60 cents above its IPO price.

    In short, investor interest in AI — while still hot in comparison with other sectors — looks like it’s simmering down.

    “The combination of waning retail demand and cautious risk sentiment among institutional investors may pose a substantial risk to the AI sector, potentially heralding a pronounced reversal in the weeks ahead,” said Vanda Research’s senior vice president Marco Iachini.

    Blame the usual suspects for this lukewarm sentiment. Higher-for-longer interest rates — and Treasury yields — caused by spiking oil prices and a tight labor market. (Initial jobless claims for last week dropped to their lowest level since late January, according to the U.S. Labor Department.)

    Against that backdrop, it’s unsurprising major indexes had a bad day. The Dow Jones Industrial Average fell 1.08%, the Nasdaq Composite slid 1.82% and the S&P 500 lost 1.64%, the most in a day since March. All three indexes are poised for a losing week, with the tech-heavy Nasdaq the deepest in the red so far.

    If it’s any comfort, September — the worst month for stocks, historically — ends in a week. Investors will hope it’ll pass like a bad dream, or a banished hallucination.

     

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  • Rupert Murdoch’s Retirement Has Fox Insiders Stunned: “I Never Thought He’d Do It”

    Rupert Murdoch’s Retirement Has Fox Insiders Stunned: “I Never Thought He’d Do It”

    From the beginning, Rupert Murdoch ran his media empire like a king who planned to die on the throne. Even death itself seemed up for debate; “I’m now convinced of my own immortality,” Murdoch famously declared in 1999 after beating prostate cancer at the age of 69. Which is why it was shocking Thursday morning that Murdoch announced he would be stepping down as chairman of Fox Corporation and News Corp, the global media conglomerates he built out of a small Australian newspaper company he inherited from his father in 1952. In November, Murdoch will take the title of chairman emeritus and hand the reins to his oldest son, Lachlan, the current CEO of Fox Corp. I was leaving a coffee shop in Lower Manhattan when my cell phone lit up with calls and texts from current and former Fox staffers searching for an explanation. “I never thought he’d do it,” a former executive said.

    Murdoch’s memo to employees sent contradictory signals about the 92-year-old mogul’s decision to retire. On the one hand, Murdoch wrote that “the time is right for me to take on different roles, knowing that we have truly talented teams.” But he also indicated he wasn’t really going away: “I will be watching our broadcasts with a critical eye, reading our newspapers and websites and books with much interest, and reaching out to you with thoughts, ideas, and advice. When I visit your countries and companies, you can expect to see me in the office late on a Friday afternoon.”

    The announcement’s ambiguity, along with its unexpected timing, raises significant questions, chief among them: What really made Murdoch decide to retire now after having resisted succession for decades?

    Current and former Fox executives are debating different theories today. One is that Murdoch, who turns 93 in March, had an unreported health crisis, which could be considered a material event for a publicly traded company. Murdoch’s memo shot down this line of speculation. “Our companies are in robust health, as am I,” he wrote. But my May Vanity Fair cover story reported that Murdoch had been secretly hospitalized in recent years for a broken back, seizures, two bouts of pneumonia, atrial fibrillation, a torn Achilles tendon, and COVID-19. Murdoch wanted these incidents out of the press. According to a source close to Murdoch, he used the pseudonym “Mr. Black” when being admitted to a hospital in order to avoid the media. So, given this history of hiding health scares, it’s entirely possible that illness forced Murdoch into retirement.

    The second theory is that Murdoch’s retirement is related to Smartmatic’s $2.7 billion defamation lawsuit against Fox News. Smartmatic is suing Fox over the network’s false claims that its voting machines were used to steal the 2020 election from Donald Trump. Sources speculated that Murdoch is retiring to avoid having to testify in the Smartmatic proceedings. “This takes him out of the line of fire,” a prominent media executive said.

    In April, I reported that Fox settled with Dominion Voting Systems for $787.5 million on the eve of the trial at least in part because Fox lawyers didn’t want Murdoch to testify in open court. “They were hoping and praying to settle for months, but they didn’t want to pay up,” a source told me. The source said the lawyers told Fox execs that once the trial began, Murdoch would be “disgraced on the stand, run out of the boardroom, and his testimony [would] expose him as a lunatic sliding into senility.” (A person close to Murdoch disputed this: “Rupert was very well prepared to testify.”)

    On Wednesday, Fox lawyers made it clear they don’t want Murdoch to testify in the Smartmatic case, asking a New York State judge to dismiss Fox Corp. from the suit because Murdoch wasn’t involved in day-to-day editorial decisions.” In response, a Smartmatic lawyer, Erik Connolly, compared Murdoch to “a Mafia boss ordering one of his lieutenants, ‘Take out Johnny Two Bones.’” “Unquestionably, we would all say the Mafia boss participated in the hit when the hit happened,” Connolly said. “The exact same thing happened here. Rupert and Lachlan Murdoch ordered a hit.”

    Another theory is that the company is facing some unknown scandal. “They are trying to get ahead of something,” a person close to the Murdochs told me.

    One thing is certain: Murdoch’s formal retirement will deepen Fox’s leadership void. The company will be solely run by Lachlan, who lives in Sydney, and is seen by many to be less engaged than his father. “Lachlan goes to the rock climbing gym every day. I think he has kind of lost interest since James left, but he is still trying to impress his dad,” a person close to Lachlan told me for my May cover story. Lachlan has largely relied on Viet Dinh, Fox’s chief legal officer, to run the company day-to-day from Los Angeles. But it was announced in August that Dinh will be stepping down at the end of the year, seemingly in part over his handling of Fox’s Dominion defense strategy. How Lachlan handles the pressures of being the new king will determine the future of a media empire that shapes conservative politics on three continents.

    Gabriel Sherman

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  • Fox Chief Legal Officer Viet Dinh to step down months after Dominion settlement

    Fox Chief Legal Officer Viet Dinh to step down months after Dominion settlement

    People walk by the News Corporation headquarters, home to Fox News, on April 18, 2023 in New York City.

    Spencer Platt | Getty Images

    Fox Corp. Chief Legal and Policy Officer Viet Dinh will step down from his post, months after the company agreed to pay a $787.5 million settlement to Dominion Voting Systems.

    The departure comes after Dinh advised the company through the lawsuit with the voting machines company, which was halted just short of a trial with the April settlement. The company has continued to feel the fallout since.

    Dominion hit Fox with a defamation lawsuit arguing its networks “intentionally and falsely” blamed the company for the 2020 election loss of former President Donald Trump to President Joe Biden by airing unsubstantiated claims that Dominion’s machines rigged the election.

    While Fox agreed to the settlement, its hosts weren’t required to talk about the lawsuit or make any public apology for on-air statements.

    Days after the settlement was reached, Fox ousted primetime host Tucker Carlson, who has since started his own show on X, the website formerly known as Twitter. Since then, Jesse Watters has become the replacement for the same primetime slot Carlson once held.

    Carlson and Dinh were among the Fox anchors and executives who were questioned as part of the lawsuit. Depositions, emails, texts and other correspondence were part of the reams of evidence released before the settlement.

    Leading up to the trial, Dominion had been urging the court to compel Fox’s top brass, including Dinh, to appear for in-person testimony. The judge presiding over the case said in the weeks before the trial’s start date that he could compel executives to testify.

    Dinh joined the company in the top legal role in 2018 and since then has led all of its legal, compliance and regulatory matters, in addition to overseeing government affairs.

    He will step down effective Dec. 31 and become a special advisor to the company.

    “We appreciate Viet’s many contributions and service to FOX as both a board member of 21st Century Fox and in his role over the last five years as a valued member of FOX’s leadership team,” said Fox Corp. CEO Lachlan Murdoch in a news release. “We are grateful that he will continue to serve FOX as Special Advisor where we will benefit from his counsel.”

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  • Lachlan Murdoch: No change in strategy at Fox News | CNN Business

    Lachlan Murdoch: No change in strategy at Fox News | CNN Business


    New York
    CNN
     — 

    Despite a turbulent and expensive few weeks, Fox News isn’t changing course.

    Fox Corp. CEO Lachlan Murdoch said there will be no change in strategy at the company’s top rated cable news network, despite the firing of its top rated anchor Tucker Carlson and a massive $787.5 million settlement to Dominion Voting Systems that resulted in the company swinging to a loss in the just completed period.

    “There is no change to our programming strategy at Fox News,” Murdoch said in response to an analyst who asked about Carlson’s ouster during the investor call Tuesday to discuss its financial results.

    Murdoch described Fox News as “obviously a successful” and suggested Carlson’s firing was a tweaking of its strategy, not a departure from it.

    “As always, we are adjusting our programming and lineup and that is what we continue to do,” Murdoch said.

    His comments came after the company reported a $50 million net loss for the just completed quarter, compared to $290 million in profit a year earlier.

    The reason was a $719 million charge including the cost of the Dominion settlement, other legal settlements related to its news division and other legal costs, including attorney fees, which was partly offset by equity earnings of it affiliates and a change in the market value of some of its investments.

    The earnings statement didn’t mention Dominion Voting Systems, although it does refer to charges related to legal settlement costs at Fox News Media. On the company’s call with investors Murdoch referred to the settlement with Dominion as in the best interest of the company and its shareholders, given rulings by the Delaware court that he said limited its defense. He said going to trial could have led to two to three years of appeals.

    “We’re proud of our Fox News team, the exceptional quality of their journalism and their stewardship of the Fox News brand,” he said. “So as we look ahead, we are confident in the strength of the Fox brands and the strength of our balance sheet.”

    And he again defended the company’s post-election coverage of the false conspiracy theories made against Dominion, even though internal communications among Fox anchors made public during the discovery process showed many of them didn’t believe the claims being made.

    “We always acted as a news organization reporting on the newsworthy events of the day,” Murdoch told investors Tuesday. “Now we have been and remain confident in the merits of our position that the first amendment protects a news organization’s reporting and allegations being made by a sitting president of the United States. However, the Delaware court severely limited our defenses and trial through pre-trial rulings.”

    Fox did not have to apologize or admit wrongdoing as part of the settlement in Dominion’s defamation suit against it, although its statement did say it acknowledged “the Court’s rulings finding certain claims about Dominion to be false.”

    Fox still faces a lawsuit from another voting machine manufacturer, Smartmatic, which is seeking $2.7 billion in damages. Murdoch told investors that case is “fundamentally different” from the Dominion case and that Fox will have greater defenses available to it than in the Delaware court hearing the Dominion case. He predicted that case won’t go to trial until 2025.

    The Dominion settlement was reached on April 18, but it was still reported in Fox’s fiscal third quarter, which concluded March 31. Excluding the legal costs and other special items reported Tuesday, it was a pretty good financial quarter for Fox.

    It reported adjusted earnings of $494 million, or 94 cents a share, up from $459 million a year earlier. That was better than the 87 cents a share forecast by analysts surveyed by Refinitiv. The company was helped by the profits and revenue gain it received from airing this year’s Super Bowl.

    Revenue at the company rose 18% to $4.1 billion, slightly higher than analysts’ forecasts. Most of that gain was due to a 43% surge in advertising revenue, helped greatly by $650 million in Super Bowl ads. Fox did not broadcast the Super Bowl in 2022.

    Fox had plenty of money available to pay the settlement. It said it had $4.1 billion in cash and cash equivalent on hand as of March 30, about three weeks before the settlement was reached. It also announced it repurchased $1.8 billion of its shares in the nine months ending March 31, as part of a $7 billion share repurchase plan. So far, Fox has repurchased $4.4 billion worth of shares as part of its plan.

    Murdoch said Fox is better positioned than many other media companies to ride out the delays and lost revenue that could take place from a prolonged strike by the Writers Guild of America. Some programming, such as late night shows, have already gone dark due to the strike that started last week, and production on other shows has been halted.

    But Murdoch said the fact that Fox has more of its revenue and profit coming from sports and news, which are not affected by the strike, puts it in a better position.

    “Our healthy balance of scripted and unscripted content on the network puts us in a tremendous position,” he said.

    The hit from the settlement was well known by investors ahead of the report. But even with the better than expected results, Fox

    (FOX)     shares were up only about 1% in trading at the market open following the report.

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  • What to know ahead of the Fox News and Dominion trial | CNN Business

    What to know ahead of the Fox News and Dominion trial | CNN Business


    New York
    CNN
     — 

    A trial in a defamation suit brought against Fox News by Dominion Voting Systems is set to begin this week. It could have significant ramifications for the right-wing cable channel.

    Dominion is an election technology company. After former president Donald Trump lost the 2020 presidential election to Joe Biden, Dominion alleged Fox pushed various pro-Trump conspiracy theories, including false and potentially damaging information about the company’s voting technology, because “the lies were good for Fox’s business.” Fox is arguing that it was merely reporting the claims made by the Trump administration and Donald Trump’s associates.

    It filed a defamation lawsuit in 2021. The trial is set to begin Monday in Delaware.

    Here are 5 things to know ahead of the trial.

    Dominion wants the network’s star hosts and top executives to appear on the witness stand during trial, it said in a court filing in March.

    Here’s who could appear as witnesses, if Dominion gets its way:

    • Suzanne Scott, Fox News CEO

    • Jay Wallace, Fox News president

    • Hosts Sean Hannity, Tucker Carlson, Maria Bartiromo, Laura Ingraham and Bret Baier

    • Abby Grossberg, a former Fox News producer who alleged that the network’s lawyers coerced her into providing misleading testimony in a lawsuit filed March

    • In April, Delaware Superior Court Judge Eric Davis said Dominion could compel Fox Corporation Chairman Rupert Murdoch and his son, CEO Lachlan Murdoch, to testify, in a big blow to Fox.

    “Both parties have made these witnesses very relevant,” Davis said, regarding the Murdochs. Fox was trying to block Dominion from having the Murdochs on the witness stand.

    Dominion is asking for $1.6 billion in damages and additional punitive damages.

    That could be a major financial hit to Fox. Fox Corporation, the right-wing news outlet’s owner, has an estimated $4 billion in cash on hand, according to its latest earnings statement. It’s also unclear how much insurance the company has, or what any insurance policy would cover.

    Punitive damages are, however, uncapped in Delaware, with no legal maximum limit.

    The network claims that number is a wildly overblown amount designed to grab attention in headlines.

    Fox argued in a statement the case is about protecting “the rights of the free press” and a verdict in favor of Dominion would have “grave consequences” for the fourth estate.

    “Dominion’s lawsuit is a political crusade in search of a financial windfall, but the real cost would be cherished First Amendment rights,” a Fox spokesperson said in a statement.

    Defamation cases are hard to win in the United States, because of the Supreme Court’s ruling in New York Times v. Sullivan in 1964. Defamation has to meet a high standard. An entity can’t have just lied, it must have known (or at least strongly suspected) it was lying at the time, and it has to have been done with “actual malice.” The court has already ruled on the first two, saying that Fox aired lies and knew they were lies, so instead of a question of truth, it’s about whether Fox did so maliciously.

    Though major figures at Fox privately acknowledged reality – that former President Donald Trump had lost to President Joe Biden in 2020 – Fox continued to air conspiracies and lies in order to keep its large audience engaged.

    A cache of private messages, emails and depositions revealed that Fox may not have upheld the journalistic responsibility to report the truth to audiences. The judge has rejected several of Fox’s First Amendment defenses and in pretrial rulings barred the network from arguing its guests’ alleged defamatory statements were “newsworthy” and deserving of coverage.

    Legal filings made public a trove of private text messages, emails and deposition transcripts, revealing how Fox hosts, producers, and executives really felt about Trump.

    The damning behind-the-scenes communications were included in roughly 10,000 pages of court documents that have been made public as part of the lawsuit, many of which are likely to be shown in the trial.

    For example, host Tucker Carlson said in one text message he “passionately” hates Trump. In one November 2020 exchange, Tucker Carlson said Trump’s decision to snub Joe Biden’s inauguration was “so destructive,” adding that Trump’s post-election behavior was “disgusting” and that he was “trying to look away.”

    Murdoch emailed New York Post’s Col Allan, describing Trump’s election lies as “bulls**t and “damaging.”

    Murdoch’s private messages revealed how his own thoughts contradicted what Fox espoused. “Maybe Sean [Hannity] and Laura [Ingraham] went too far,” Murdoch wrote in an email Fox News chief executive Suzanne Scott, apparently referencing election denialism after Trump’s loss to President Joe Biden.

    The trial will begin Monday in Delaware at 9 am ET, with expected opening statements at some point during the day. Jury selection is also expected to wrap up Monday morning, ending with a panel of 12 jurors and 12 alternates. It’s anticipated that opening statements will begin immediately after the jury is seated. The trial is expected to last five to six weeks.

    Dominion will need to convince the jury that Fox acted with “actual malice” — showing the right-wing network’s hosts and executives knew what was being said on-air was false but broadcast it anyway, or acted with such a reckless disregard for the truth that they should be held liable.

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  • Fox News election fraud revelations could take down the network’s embattled chief | CNN Business

    Fox News election fraud revelations could take down the network’s embattled chief | CNN Business


    New York
    CNN
     — 

    Who will Rupert Murdoch exile from the Fox kingdom?

    The Fox Corporation chairman is facing an ever-deepening scandal that threatens to cause considerable financial and reputational damage to the crown jewel of his media empire, Fox News, as well as the parent company he leads. The scandal, exposed by Dominion Voting Systems’ blockbuster $1.6 billion lawsuit, has unearthed damning information, revealing the right-wing talk channel, driven by financial interests, was willing to lie to its viewers.

    The stunning levels of misconduct exposed in recent weeks raise questions about the future of Suzanne Scott, the embattled chief executive of Fox News. Will she be Murdoch’s sacrificial lamb? No moves are currently on the immediate horizon, CNN is told. But it’s certainly possible — perhaps even likely — that Murdoch might cancel her in an attempt to save himself and his legacy.

    The Murdochs “are certainly setting Suzanne Scott up to take the fall for this,” Ben Smith, the Semafor editor-in-chief who writes a Sunday night media column, said Wednesday.

    “They’re leaving a trail of crumbs that lead back to her office,” added David Folkenflik, the NPR media correspondent and Murdoch biographer.

    A version of this article first appeared in the “Reliable Sources” newsletter. Sign up for the daily digest chronicling the evolving media landscape here.

    There is no shortage of evidence to support the notion Scott is on the chopping block. Most notably, during his deposition, Murdoch sought to distance himself from decision making at Fox News. Instead, he pointed to Scott: “I appointed Ms. Scott to the job … and I delegate everything to her,” he said. In doing so, Murdoch made the case that Scott is in charge of the network — and if there was wrongdoing, it rests on her shoulders. Of course, astute media observers know that Murdoch is the person actually calling the shots. But it’s not hard to see how the company could advance this narrative.

    This is not the first time that Murdoch has been faced with a serious and embarrassing matter in his media empire. In 2011, his now-defunct News of the World newspaper was ensnared in a phone hacking scandal. In 2016, Fox News founder Roger Ailes was accused in an explosive lawsuit of sexual harassment. And in 2017, star host Bill O’Reilly was caught in his own sexual misconduct scandal.

    In each case, Murdoch made the decision to sever ties with top personnel. As one source who once worked in Murdoch-world said Wednesday, “His pattern has been to throw some money overboard and offer a head or two in the process to make it go away.” And cutting ties with Scott would appear to be one of the easier ousters for Murdoch to execute over the course of his decades at the helm of one of the world’s biggest media empires.

    “Looking back to previous scandals, Murdoch and the companies have tended to try to pay early and quietly to make things go away, or they ignore them thinking they’re so big they can ride things out,” Folkenflik said. “And then when things really come to a head, they try to cauterize the wound at the lowest level possible.”

    “If he threw [Scott] over, he would only do it because he thought he needed to cauterize the wound before it goes higher,” Folkenflik added. “That’s his record. That’s what he does. It can be editors. It can be executives. It can be stars. He’s not throwing himself over the side.”

    Jim Rutenberg, the former media columnist at The New York Times who has an extensive history covering Murdoch, echoed that sentiment.

    “Murdoch has a history of sacrificing loyal lieutenants, but he does it only in the most extreme circumstances,” Rutenberg said. “We know that he hates doing it. We know that he tends to try to fight for his loyalists, even for Ailes, certainly for O’Reilly. But when it’s a necessity to overcome a real threat to his business, he’ll do it.”

    Whether the circumstances have reached a boiling point yet are unclear. The Dominion lawsuit, which has already caused massive reputational damage to the Fox News brand, is still in the pre-trial phase of the case. There’s no telling what could emerge from a weeks-long trial in which prominent executives and hosts such as Tucker Carlson and Sean Hannity are called to the stand. And it remains to be seen whether outside forces, such as potential shareholder lawsuits, come into play and exert added pressure on Murdoch to take action.

    Regardless, it’s worth noting that Murdoch himself has signaled that firings could be coming. When asked in his deposition whether Fox News executives who knowingly allowed “lies to be broadcast” should face consequences, Murdoch responded in the affirmative: “They should be reprimanded,” he said. “They should be reprimanded, maybe got rid of.”

    As Folkenflik noted, “If you’re Rupert, you can’t fire Rupert. And you’re not going to fire [Fox CEO] Lachlan [Murdoch] either. So who are you going to chop?”

    “Everyone who takes a senior executive position under Rupert Murdoch knows that is the case, that is the ultimate fall position,” Folkenflik explained. “They understand that’s part of the job. You’re very well paid. It can be a somewhat glamorous life. If you fall out of favor with the sun king, or it is to his benefit, that’s part of the equation.”

    We’ll see what Scott’s fate ultimately looks like. For now, Fox is not offering any public statement of support for her. When I reached out to Fox spokespeople on Wednesday asking for comment, the company declined.

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  • The Year in Media: 7 Cliff-Hangers to Keep You in Suspense as the Ball Drops

    The Year in Media: 7 Cliff-Hangers to Keep You in Suspense as the Ball Drops

    Can Chris Licht Turn CNN Around?

    Licht’s confidantes and advisers must have been beaming when James Stewart’s long-awaited New York Times profile landed on December 18, like a warm bundle of holiday cheer. (Licht’s boss, Warner Bros. Discovery CEO David Zaslav, gave the piece a hearty plug on Instagram.) After months of rough and relentless coverage that put Licht’s leadership under the lens of a high-power microscope, here was a sympathetic portrait from a titan of the business pages. Nevertheless, it’s too early to tell whether Licht and his lieutenants can continue to flip the narrative. CNN brought the curtain down on 2022 with a painful culling that put hundreds out of work. Annual profits, as Stewart noted, have fallen by $500 million. The network’s big streaming plans imploded. Its ratings leave a lump in the throat. All of which suggests that Licht has his work cut out for him. His to-do list in the New Year includes locking in a prime-time lineup that has a fighting chance of narrowing the gap with MSNBC and—more dauntingly—Fox News; gaining audience momentum for CNN’s recently rebooted flagship morning show; and winning the goodwill of employees, who saw morale tank during the rocky first eight months of Licht’s tenure.

    Can The Washington Post Stave Off a Mutiny?

    Last we saw Post publisher Fred Ryan, the pitchforks were out as he retreated from a room full of furious employees after he’d informed them—in spectacularly ham-fisted fashion—of looming layoffs, and then refused to take any questions. (“Democracy dies in darkness, huh?” one staffer scoffed to this publication.) The fallout was swift: Video of the disastrous town hall circulated on Twitter; a gaggle of union holdouts, including several star reporters, enlisted with their colleagues in the NewsGuild; and reports swirled hinting at friction between Ryan and the executive editor he’d appointed just last year, Sally Buzbee. The drama unfolded against a backdrop of dimming financial prospects. Digital subscriptions are reportedly down. One presumes advertising is just as rough as it is throughout the industry. And the brass, unlike that of, say, The New York Times, haven’t exactly evinced a clear business strategy to restore the mojo. Is this the same Washington Post that enjoyed copious growth and success under the legendary newsroom reign of Marty Baron? The larger that question looms in the collective media consciousness, the more fragile Ryan’s leadership may start to seem.

    Will The New York Times Avert a Strike?

    At the time of this writing, Times leaders and their more than 1,300 employees in the NewsGuild remained at an impasse in a tense and protracted bargaining process, with the Guild reportedly rejecting a proposal to bring in a federal mediator. This latest development came on the heels of a work stoppage that left the Times, for 24 hours at least, without the firepower of a large segment of its journalistic corps. The one-day action was a significant escalation in the union’s fight for higher salaries befitting not only the realities of inflation, but the Times’ ongoing prosperity. It may not stop there. Over the past few years, the NewsGuild has expanded aggressively in membership and influence across the media, while demonstrating its willingness to resort to more hardball tactics. (“Radical” is a word I’ve heard tossed around to describe its professional leadership.) Last year, The New Yorker—which, like Vanity Fair, is owned by Condé Nast—came perilously close to a strike during its own tussle with the Guild. Which is to say, even if the prospect of Times journalists walking off the job indefinitely may seem remote, it’s hardly fanciful.

    Will Fox and News Corp Reunite?

    Joe Pompeo

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