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When the bombshell that Fox News and its star primetime host Tucker Carlson were parting ways hit the wire just before 11:30 a.m. ET on April 24, Fox Corp.’s share price went into a free fall.
In minutes, the stock price fell 5.5 percent, wiping out more than $900 million from the company’s market cap.
If Fox News is the financial crown jewel of Fox Corp. (defamation cases notwithstanding), Carlson was arguably its shiniest gem, by far the most watched individual host on the channel, and the one host that went all in on populism even as many of his colleagues toed the party line.
In the company’s last fiscal quarter earnings, Fox had revenue of $4.6 billion and net income of $321 million. The cable division (of which Fox News is the largest component by far) accounted for only $1.6 billion in revenue (about a third of the company’s revenue) but made up most of Fox’s EBITDA, underscoring the profitability of Fox News, and its importance to the company.
“The Carlson situation is obviously a negative for Fox; he was a big moneymaker,” says Matthew Tuttle, CEO of Tuttle Capital Management. “Fox looks like it has some more potential downside here.”
Carlson had been as close to untouchable as one could imagine at Fox News before his abrupt departure. He was said to have a close relationship with Fox Corp. CEO Lachlan Murdoch (though it clearly wasn’t close enough), and he was frequently atop the Fox News ratings charts — which meant that he was on many days the most watched person on cable TV.
In March, Carlson’s show, Tucker Carlson Tonight, averaged 3.3 million viewers, adding half a million viewers from his lead-in, Jesse Watters Primetime, at 7 p.m., with 9 p.m. host Sean Hannity averaging 2.5 million viewers, a loss of 700,000 viewers. While the final April numbers are not in yet, Carlson is on track to lead Fox News in the ratings once more, thanks in part to securing Donald Trump’s first post-indictment interview. While many advertisers had abandoned his hour, its high viewership has proven valuable in cable carriage negotiations.
The precipitous fall only underscores the hole that Fox News will have to fill, not only in the heart of its primetime lineup, but on the streaming service Fox Nation, where Tucker Carlson had his own sub-channel, and where his team produced documentaries about FTX, Joe Biden, and most recently a project called Let Them Eat Bugs, which suggested climate activists want to force Americans to give up meat in favor of insects.
“The entire episode of Let Them Eat Bugs — not quite as good as pizza — streaming now on Fox Nation,” Carlson said at the end of Friday’s program, before adding that he would be “back on Monday.”
Just as Marie Antoinette was said to go out with “let them eat cake,” Carlson went out at Fox News with “let them eat bugs.”
In fact, Fox Nation’s Tucker Carlson Originals is emblematic of the power Carlson held at Fox.
Carlson pitched the idea himself to Fox News CEO Suzanne Scott on Nov. 9, 2020, just days after Donald Trump lost the presidential election to Joe Biden. According to a copy of the email (which was included in the correspondence released by Dominion Voting Systems in its defamation suit against the channel), Carlson wrote to Scott that “as dangerous this moment is for us, I think it could be an opportunity to reestablish trust with our viewers.”
With Fox ratings suffering at the expense of competitors like Newsmax, Carlson told Scott that he and his top producer, Justin Wells, had lots of ideas for the streaming project, which would become a cornerstone of the Fox Nation lineup.
“Given everything that’s happening right now, I believe it would be wise, and reassuring to our viewers, to announce an initiative like this sooner rather than later.”
Three months later, Fox News announced a multiyear contract extension with Carlson, including the addition of Tucker Carlson Originals to Fox Nation, and a promotion for Wells as vp of Tucker Carlson digital content. Wells, like Carlson, exited the channel Monday, a source tells The Hollywood Reporter.
As it happens, it was other comments from Carlson unearthed in the Dominion case that may have led to his downfall. Two sources speculate that comments made by Carlson about Fox executives or management were responsible for his ouster, though the comments themselves remain redacted for now, with little chance of them coming to light thanks to the settlement.
Carlson’s departure opens a Pandora’s box for Fox, which now has to not only find a host that can maintain the channel’s iron grip on cable news primetime just as the 2024 presidential election kicks into high gear, but also needs to rework its streaming pivot, which had blended Carlson’s populist docs with entertainment fare like the Kevin Costner-led doc Yellowstone One-Fifty, and Roseanne Barr’s return to stand-up comedy.
On the TV side, Fox’s bench of opinion hosts is not as deep as it perhaps could be, especially with the departure of weekend host Dan Bongino last week. The channel has strategically used its afternoon panel show The Five as something of a proving ground for talent, with three out of the five hosts — Dana Perino, Greg Gutfeld and Jesse Watters — securing their own shows elsewhere on the schedule.
The Five has traded ratings victories with Carlson in recent months, and was in fact the most watched show on Fox News in the first quarter of this year.
Fox’s focus was also apparent in its upfront pitch to advertisers, held in Gutfeld’s studio March 21. There was a heavy presence from Fox’s news side, including anchors Bret Baier, Martha MacCallum, Shannon Bream, and Harris Faulkner. From the opinion side, it was The Five team of Gutfeld, Watters and their co-host Jeanine Pirro who helped close out the presentation.
Now, the channel will launch a hosting bake-off at 8 p.m., similar to the one it ran at 7 p.m. for nearly a year before Watters was named to the post in January 2022. The stakes this time, however, will be much higher.
Perhaps more significantly, Fox may need to contend with Carlson competing with the channel elsewhere, though there are no indications such a move is imminent, despite interest from multiple parties, per two sources familiar with the outreach.
A high-level source at a competing cable news channel told THR earlier this month that the $787 million Dominion defamation settlement would be inconsequential to Fox News’ long-term business. The only real threat, they argued, would be the departure of someone like Tucker Carlson.
Already some far-fetched suitors have thrown their hat in the ring, with the Russian state TV outlet RT tweeting an apparent offer to the host, and the far-right One America News Network releasing a statement saying “One America News founder and CEO Robert Herring would like to extend an invitation to Carlson to meet for negotiation to become a part of the OAN team.”
Then there’s Newsmax, led by Trump ally Chris Ruddy, who has tried to transform the conservative channel into a major cable news player in part by hiring former Fox talent like Greta Van Susteren and Eric Bolling.
“For a while, Fox News has been moving to become establishment media, and Tucker Carlson’s removal is a big milestone in that effort,” Ruddy says. “Millions of viewers who liked the old Fox News have made the switch to Newsmax, and this will only fuel that trend.”
Newsmax’s lineup of hosts on Monday blasted the decision as “cancel culture.” Trump, in an interview taped for Newsmax apparently minutes after Carlson’s firing, told the channel he was “shocked” by the move.
But among industry insiders, the consensus seems to be that Carlson will branch out on his own, attempting to craft a digital empire that would put his old venture The Daily Caller to shame. No cable news competitor has the budget to match Fox’s millions (though equity would be an option), nor do they have the audience. (The Daily Caller website brought in 3 million unique visits in March, per Comscore, compared to 88.6 million for Fox News digital.) Carlson could instead try and bring his audience to his own platform, and would have no challenge raising money for it.
“This is going to be great for Tucker,” former Fox News primetime host Megyn Kelly said on her radio show Monday. “I predict Tucker goes independent. Tucker launches a podcast or digital show and crushes it. Absolutely crushes it.”
To that end, the conservative video platform Rumble, which counts Donald Trump Jr. and Glenn Greenwald (both friends of Carlson) among its power users, saw its share price skyrocket by more than 12 percent in the minutes after the Carlson news came out.
To be sure, Fox has navigated this journey before. Six years ago, Fox fired its most watched host and 8 p.m. star Bill O’Reilly in the wake of a harassment claim. Carlson took advantage of the shot and transformed himself from a more conventional conservative talker on Fox & Friends Weekend into the populist persona that he became known for in primetime.
Fox is betting that its massive platform, and the influence it holds in conservative circles, can help it weather the storm and propel whoever takes over the slot full-time. From its point of view, Carlson was a cog that can be replaced.
As for Carlson, he has no shortage of options, though Kelly is not the only former primetime Fox host who thinks Carlson should go indie.
Reached by THR on Monday night, O’Reilly said that Carlson should follow in the footsteps of another veteran of traditional media who found a home doing his own thing.
“Mr. Carlson could make a ton of money doing a podcast like Joe Rogan,” O’Reilly said. “He’s perfect for that.”
This story first appeared in the April 26 issue of The Hollywood Reporter magazine. Click here to subscribe.
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