Fox Corp. CEO Lachlan Murdoch insists that cable news outlet Fox News is now so dominant in its ratings — garnering roughly 65% of the market share among its competitors — that it should now be considered a “fifth broadcast network” alongside ABC, CBS, Fox and NBC.

Murdoch sat for an interview with Managing Director and Head of U.S. Media Research for Morgan Stanley Ben Swinburne during his company’s Technology, Media & Telecom Conference on Monday and took something of a victory lap, given Fox News’ absolute ratings dominance in the past year.

Swinburne noted that Fox News is “obviously the biggest driver of cash flows” for its parent company, which Murdoch oversees. “How is it sustainable given all of the headwinds we know about to traditional TV, that you can keep growing distribution revenues for that business over time?” he asked.

“Look, it comes down to great content, great journalism and a great brand ultimately. If you look at the Fox News viewer, they’re incredibly loyal,” Murdoch replied. “They’re passionate about the service. They really see it as not just as a news service but as a network for them.” Murdoch later touted 2 to 2.5 million subscribers to the streaming service Fox Nation, which seemed to underline the lifestyle aspect of Fox News super fans.

“It’s important to note that we don’t see Fox News anymore as just a news service,” he continued. “We see it as one of the top five broadcast networks in the United States, even though we don’t have the same distribution that broadcast has,” flatly suggesting that Fox News should be considered in the same canon as broadcast networks. To his point, cord-cutting and streaming blur the distinction between broadcasting and cable delivery.

“In January and February, we were the number two broadcast network, right?” Murdoch explained. “Equivalent to the number two broadcast network at Fox News. Despite having a much smaller universe in cable. In January, we were only beaten by NBC, and in February we were only beaten by CBS. And so that’s how we view it. And that’s how we’re able to drive, frankly, the affiliate revenue growth that we’ve achieved.”

Murdoch later explained why he was proud of what he accomplished by noting how roughly two of every three cable news viewers is tuned in to Fox News.

“It’s very important and it’s what we think about all the time and we work very hard on. It’s also important because if you think about the strength of Fox News in a traditional universe, it’s 65% share,” he said.  “You know, it’s a lot of work to get the 70% share, you’re never going to get to 100 – probably not – and so you have to look in new markets and also in this last election what was obvious for everyone who was watching was the emergence of non-linear and nontraditional platforms and their importance in this election.”

Murdoch underplayed Fox News’s critical role in the 2024 election, which has drawn reasonable criticism for putting its very heavy thumb on the electoral scale with their arguably pro-Trump story selection. But editorial judgment aside, it’s very clearly working for Fox News. And given the parade of world leaders that opted to sit with Bret Baier last week, and no other network anchor, it’s clearly having a massive influence on global politics as well.

Full transcript (provided by Morgan Stanley and Fox News PR):

Ben Swinburne/: What are you guys focused on for ‘25? What are some of the real strategic priorities for you and the team?

Fox Corporation Executive Chair and Chief Executive Officer Lachlan Murdoch: For us in the last quarter, we had affiliate revenue growth in both cable and television segments. That’s despite a roughly sort of 7% decline in subscribers. So, despite that decline in subscribers, we were able to drive growth in the quarter. For the next year, we have a number of affiliate deals coming up — a little bit less than normal — we usually are about a third every year, it’s less than a quarter of our distribution deals come up over the next year, and we’ll be very focused on renewing them at positive terms for us. We’re going to continue to push the strength of Fox News. Fox News is enjoying an incredibly strong leadership position right now. You always are a little unsure after an election, you often get a dip in ratings. We’re not seeing that. We’ve gone from strength to strength. So, we’re going to continue to push the leadership of Fox News. And then we’re going to invest in our digital priorities, such as Tubi.

Ben Swinburne: Why don’t we shift gears to Fox News, which is obviously the biggest driver of cash flows for the company. And you mentioned it earlier, but the revenue trends for your business in cable, but Fox News, really, are outliers in a good way relative to the rest of the industry. So how do you — particularly the affiliate side — how is it sustainable given all of the headwinds we know about to traditional TV, that you can keep growing distribution revenues for that business over time?

Lachlan Murdoch: For Fox News?

Ben Swinburne: Yeah.

Lachlan Murdoch: Look, it comes down to great content, great journalism and a great brand ultimately. If you look at the Fox News viewer, they’re incredibly loyal. They’re passionate about the service. They really see it as not just as a news service but as a network for them. It’s important to note that we don’t see Fox News anymore as just a news service. We see it as one of the top five broadcast networks in the United States, even though we don’t have the same distribution that broadcast has. In January and February, we were the number two broadcast network, right? Equivalent to the number two broadcast network at Fox News. Despite having a much smaller universe in cable. In January, we were only beaten by NBC, and in February we were only beaten by CBS. And so that’s how we view it. And that’s how we’re able to drive, frankly, the affiliate revenue growth that we’ve achieved.

Ben Swinburne: I don’t think I’m breaking any news here to say after the election, a lot of people feel like the whole country is sort of stepping to the right a bit politically. Is that something that you guys are reacting to at the network in terms of the program or how you manage the business?

Lachlan Murdoch: Nope

Ben Swinburne: You disagree?

Lachlan Murdoch: I disagree – here’s why. Fox News has been the number one news network for 23 years. 23 years. So, you know, we see ourselves as a common sense network. We cover stories that we believe – our viewers – are newsworthy and that our viewers are interested in. That hasn’t changed. I think what has changed is perhaps it’s the reverse of what you’re applying in your question, is that the election and the election results have sort of validated Fox News’ position, and we’ve seen that most strikingly in our advertising revenues. We’ve had over 100 new clients since the election – obviously, our ratings are doing tremendously well. Our share is doing tremendous well, over 65% share of the cable news universe. Ratings are up something like 50%. But I think because of the election result, many advertisers have sort of rethought their positioning in this country and understand that the Fox News viewer really does represent middle America. And they’re responding by, with their checkbooks.

Ben Swinburne: Got it. One of the areas you guys have been investing in a while has been Fox Nation, I don’t know if that’s still an area of investment and growth for the company. Maybe you can update us on that.

Lachlan Murdoch: So, Fox Nation, for those of you who don’t know, is a subscription video on demand service we’ve had for a number of years, which really serves the Fox News super fan, super user. It’s grown very well, particularly this year. We’ve got strengths in programming such as Yellowstone to Yosemite with Kevin Costner and the Saints programming around the lives of the saints, Martin Scorsese producing. So, it’s done incredibly well, but it’s a modest investment in the scheme of things. But it’s also in the 2 – 2.5 million subscriber range – we know that they’re the super fans of Fox News, and we can do longer form programing with it, for instance. In fact, Marco Rubio, I saw a clip yesterday, was referring to a long form show we had explaining the Panama Canal to the audience and relevant to the history. It’s an amazing history of the Panama Canal and why it’s important. That’s something we can’t do on broadcast. It’s long form, but we can do it on Fox Nation. And it’s been a very successful formula.

Ben Swinburne: You know, one of the other things that’s been a big topic post election is, has been the evolution of the news business. And I’m just wondering, as you think about the long term for Fox News, which has continued to kind of pull away from CNN and MSNBC, how do you think about growing news distribution platforms, like in particular, podcasting? You know, social is not new, but more and more just a younger demo getting their news from non-TV businesses. Is that important as you guys think about, you know, the future of Fox News and what are you guys trying to do to position yourselves to win there?

Lachlan Murdoch: It’s very important and it’s what we think about all the time and we work very hard on. It’s also important because if you think about the strength of Fox News in a traditional universe, it’s 65% share. You know, it’s a lot of work to get the 70% share, you’re never going to get to 100 – probably not – and so you have to look in new markets and also in this last election what was obvious for everyone who was watching was the emergence of non-linear and nontraditional platforms and their importance in this election. So Fox News, for instance, in January, we did 410 million YouTube views for Fox News clips, which was which was a record and far surpassed anyone else in the news category. I think we had like 122 million digital users in January generating about 2.2 billion page views for Fox News just in January. In social media, we had a — in January, we had a billion social media interactions and sort of shares. That’s across TikTok, that’s across Facebook, X, Snapchat – a billion interactions. So, we’re doing a tremendous amount and getting our content out there in front of that audience who still by the way, when they’re surveyed on this, they say that they don’t get their news from traditional media, but often they are getting it just through these other channels. So, it’s very important for us to sort of pursue that market. And then we made this investment this year, just recently, announced a few weeks ago with Red Seat Ventures, which is a podcasting company, which actually does sort of a third-party sort of facilitation, ad sales and podcasting for independent creators. And we’re excited about that because we’ll be able to put our own talent through that system. But we’re also sort of exposed to third party creators as well. And really gives us a significant position into this new podcasting platform. So we’re excited about that.

The post Lachlan Murdoch Says Fox News Is Now Fifth Broadcast Network first appeared on Mediaite.

from Mediaite https://ift.tt/QRXLnkY