The Hollywood Reporter - 30.10.2019

The Business

THE HOLLYWOOD REPORTER 42 OCTOBER 30, 2019

TODD WILLIAMSON/GETTY IMAGES

Analysis

Illustration by Victor Kerlow

S

hari Redstone has denied

plans to launch a conserva-

tive-leaning TV channel to

battle Fox News, but the mogul’s

Viacom dipped its toe into the

space Oct. 15. That day, the com-

pany’s Pluto TV free streaming

service — which Viacom bought

in March for $340 million and has

18 million users — debuted a beta

version of the channel The First,

featuring right-wing talkers Buck

Sexton and Jesse Kelly.

Not exactly the name recogni-

tion of Fox News’ Sean Hannity

or Tucker Carlson. But The First

is set to add three more shows by

January when it officially enters

a crowded space that includes

BlazeTV, Newsmax TV, One

America News Network, Daily

Wire, Breitbart News and Salem

Media Group, all of which are

positioning themselves as an

alternative to Fox News, which —

despite its aging linear audience

— makes roughly $1.3 billion a

year for its Fox Corp. parent. For

context, Disney’s entire broadcast

business, which includes ABC

Who Wants to Take on Fox News?

None of the ‘amateurish’ rivals to the Murdochs’ cash-cow TV channel has the resources to

compete, leaving a door open for a well-funded conglomerate (say, ViacomCBS) to roll the dice

its opinion shows. Herring says

20 hours a day is straight news at

One America.

But these would-be Fox rivals

don’t have the resources of the

Murdoch-run empire. “Fox has

been blessed with amateurish

competitors,” says Ken LaCorte,

the former vp of Fox News Digital

who founded digital upstart

LaCorte News. “Take Bill O’Reilly

on Newsmax TV, where his

cheesy background, no makeup

and crappy audio make him look

like he’s on community access

television.” (Counters Newsmax

founder Christopher Ruddy, “If

people want to be truly informed,

they should be checking out what

Newsmax has to offer.”)

ViacomCBS would have better

infrastructure than Newsmax,

Blaze and One America, and the

conglomerate could lean on an

existing sales team — say from

CBS News — to sell ads on the

cable channel; it could also use

existing CBS studio space.

While ViacomCBS doesn’t have

the sway of some larger competi-

tors like NBCUniversal (which

is in early stages of planning a

“global news channel” with Sky

News), it has some bargaining

power and could force distribu-

tors to place any potential

channel adjacent to Fox News,

a tool that One America and

Newsmax don’t have. Fox News

was able to put Fox Business

Network near CNBC and the main

Fox News channel using that

distribution strategy.

As for The First, one of

165 licensed partners at Pluto

(CNN, BBC, CNN and MGM

are others), it’s from Red Seat

Ventures, a firm launched in 2015

by founding executives of Glenn

Beck’s Blaze. Says Red Seat CEO

Christopher Balfe of the channel:

“The next generation of talent,

people like Ben Shapiro, are

mostly found on YouTube. We’re

going after that audience, which

is 30 years younger than the audi-

ence for cable news.”

Alex Weprin contributed to

this report.

(but not ESPN), makes about what

Fox News does each year. It begs

the question: Why hasn’t another

TV conglomerate pulled the trig-

ger on a competitor with wide

cable distribution?

The entry barrier is steep.

Fox News spent an estimated

$300 million to launch in 1996,

including paying carriers $11 per

subscriber to carry the chan-

nel with 17 million subs at the

start. And the last big cable

news upstart was

a massive failure.

Al Jazeera America

collapsed after

buying left-leaning

Current TV, which

was available in about 40 mil-

lion homes, in a deal valued at

$500 million.

“A lot of publicly traded media

companies may want to steer

clear of the controversy of trying

to do conservative news,” notes

analyst Steven Birenberg of

Northlake Capital Management.

Among existing brands,

Newsmax, One America and

Blaze have cable and satellite

distribution, but they’re not

rated by Nielsen, suggesting

TELEVISION | PAUL BOND

PAU L BON D is West Coast business

editor at The Hollywood Reporter.

Fox News

Outpaces Rivals

on the Web, Too

Fox News

95.2M

Salem Web Network

11.1M

One America News Network

265K

Newsmax

2.6M

Daily Wire

3.4M

Daily Caller

4.5M

Breitbart

5.5M

The Blaze

5.9M

their audience on television is

small. One America president

Charles Herring says Fox News

thrives because it serves “often

ignored middle America” but

that its primetime lineup “has

a fundamentally different voice

than some dayparts,” which Fox

News acknowledges by stress-

ing that its news is distinct from

Source: Comscore September 2019 unique visitors. S&P Global Market Intelligence; THR research, SEC filings.

Fox, however,

trails its cable

competitor CNN,

which has a

digital audience

of 129M.

Ben Shapiro

co-founded

the Daily Wire

in 2015 after

leaving

Breitbart News.

Redstone