Commentary

Will Changes At Fox News Channel Cut Into Revenue, Branding?

by Wayne Friedman , Staff Writer, July 21, 2016

Fox News Channel carries big brand and financial weight for the entire 21st Century Fox company. What will happen in the next few years with its long-time leader on the outs?

The mention of “Fox” for many people, means “Fox News” -- a daily brand reminder of what it represents to the overall company.

For many this means a hard-nosed, take-no-prisoners -- and, to many, a hugely politically partisan -- media brand. It surely looks to take a hit as Fox News Channel Chairman/CEO Roger Ailes departs.

Digging deeper, the cable news channel actually contributes 25% of 21st Century Fox’s entire key cash flow measure -- earnings before interest, depreciation, taxes and amortization (EBIDTA) -- according to analysts.

Looking at overall revenues, Fox News Channel pulls in nearly 8% of 21st Century Fox’s annual revenues. The parent company pulled in around $28.987 billion in revenue last year.

By itself Fox News Channel is wildly profitable, with some $1.6 billion in operating profit on some $2.3 billion in overall revenue.

What will the departure of Roger Ailes -- and all the news surrounding his alleged sexual harassment -- mean to Fox? Marci Ryvicker, media analyst/managing director of Wells Fargo Securities, says Ailes' trouble will likely be an "overhang" on the stock.

Pew Research, using Nielsen research, notes overall cable network viewership has been slightly trending down between 2009 through 2015 -- to an average 1.997 million daytime viewers (2015) from 2.187 million (2009).

That said, big presidential political seasons still mean an uptick -- especially this year with the big numbers that Donald Trump has been attracting on TV. Live TV news is also important in an increasingly time shifted, on-demand TV/video world.

Against this whole picture, Fox News Channel is still the dominant cable news network -- well ahead of the likes of CNN and MSNBC, even as those networks have been making gains.

Will Fox News Channel continue to carry this financial heft and brand identity in future years? Whoever leads the network in the coming years will have some tough comparisons to deal with.

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2 comments about "Will Changes At Fox News Channel Cut Into Revenue, Branding?".

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Chuck Lantz from 2007ac.com, 2017ac.com network, July 21, 2016 at 5:36 p.m.
Claiming that "Fox News Channel is still the dominant cable news network" is the same as saying "McDonald's Big Macs are still the dominant health food", simply because a lot of people buy them.

Fox News is, and always has been, the newest version of yellow journalism. To not say so, each and every time they are mentioned, is unfair to the legitimate news outlets and to legitimate journalists.

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Paula Lynn from Who Else Unlimited, July 21, 2016 at 8:37 p.m.

It leads in lies and hate and racism and bigotry and all kinds of vitriol, but it is not the only outlet. If it doesn't lead, it doesn't matter for the audience who have been indoctrinated in these matters with more outlets springing up with the established convictions that this inhumanity is the right path. Crowd mentality deepening into darkness.