Now that Rupert Murdoch is out, here's the biggest question for Fox
Murdoch is handing the company to his son James and will remain as executive chairman. His other son, Lachlan, will be promoted to executive cochairman. At the same time, Chase Carey, the COO of the company also reportedly plans to leave.
From what we've been told, Carey and Ailes are close allies, and they don't get along with the Murdoch brothers. With Carey and Murdoch out, Ailes is losing two powerful allies at the top of the company.
Fox says Ailes will still report directly to Murdoch, an unusual arrangement that supports what we've been told about Ailes' relationship with the Murdoch brothers. Perhaps this arrangement can work in the long run, but it seems destined to run into problems. The CEO of the company should have direct control over one of the company's most valuable assets.
While Fox News is a controversial news outlet, there's no denying its astounding success.
In a recent profile of Ailes, The Hollywood Reporter detailed the impressive stats on the channel:
- Wall Street analysts value Fox News at $15 billion.
- It contributed 18% of 21st Century profits in 2014.
- It has 70 consecutive quarters of profit growth.
- SNL Kagan says it will bring in $2.18 billion this year in advertising and affiliate revenue.
- It gets $1 per subscriber per month, which blows away CNN ($0.61) and MSNBC ($0.30).
The contract at Fox of 75-year-old Ailes is up in 2016. He told The Hollywood Reporter nobody from Fox had been in touch yet to talk about renewing his deal. Considering the fact Ailes is a cash machine for Fox, this is a tad strange.
He built Fox News from scratch, and the network's talent says the network would fall apart without him.
Bill O'Reilly, for instance, told The Hollywood Reporter: "I have no idea how the network would shake out if he wasn't here."
Shep Smith said: "But like no other place I've ever worked, it's all about him. Everything you see and feel about, it is from him. The truth is, he loves this place."
And even rival CBS News president David Rhodes said, "It's his creation. He built it ... I'm not sure anyone else can run it."
New CEO James Murdoch will either have to figure out how to get along with Ailes - and offer him a big pay day to stick around - or he'll have to let Ailes walk and risk sinking one of his most profitable, influential, and important products.
This is going to be a fun media drama to watch play out over the next twelve months.