Lachlan Murdoch, CEO of Fox Corporation and heir to Rupert Murdoch’s media empire, spoke at the SVB MoffettNathanson conference today (May 17). He shed light on the abandoned News Corp merger, the settled Dominion Voting Systems lawsuit and Fox’s outlook on sports streaming.
Fox has been the subject of many news stories in recent months. In April, the news station parted ways with Tucker Carslon, its primetime star who brought in the most advertising dollars. Days prior to Carlson’s departure, Fox settled the lawsuit with Dominion Voting Systems—which accused the network of defamation related to its coverage of the 2020 election—at the price of $787 million, 5.6 percent of its 2022 revenue. Earlier this year, Rupert called off the potential merger with News Corp.
Why didn’t the News Corp merger go through?
In October, Rupert proposed to merge Lachlan’s Fox with his own’s News Corp, which had been one company until 2013. The idea behind the union was to “broaden the geographic spread of Fox,” Lachlan said at the conference today. While Fox is U.S.-based, News Corp has strong ties in international markets. It is the leading media conglomerate in Australia and owns a series of British newspapers and tabloids. A merger also looked advantageous to shareholders, Lachlan said.
During merger discussions, CoStar Group—the commercial real estate company that owns Apartments.com—made a $3 billion bid to acquire News Corp’s real estate site and other assets, which made the merger too complicated, according to Lachlan. CoStar later backed out of negotiations.
Lachlan Murdoch thinks Fox would have won the Dominion trial
Dominion, the company that owned voting machines used in the 2020 election, filed a lawsuit against Fox for $1.6 billion in 2021. It claimed the network repeatedly broadcasted lies about the company, including that it rigged the 2020 presidential election and paid kickbacks to government officials. Its television personalities Maria Bartiromo, Tucker Carlson, Lou Dobbs and Sean Hannity, as well as their on-air guests, repeated these falsehoods despite knowing they were untrue, according to the lawsuit. The parties settled the lawsuit before it reached a trial.
In the interview today, Lachlan said none of the Fox News hosts engaged in defaming Dominion. Fox would have won the lawsuit, he said, despite legal experts citing Dominion’s strong position. A load of evidence emerged following the filing, including leaked text messages from hosts Carlson, Hannity and Laura Ingraham revealing their personal feelings towards former President Donald Trump and how to cover the election. While Fox’s stock hasn’t suffered from the negative press coverage surrounding the lawsuit, the trial could have still been a long and costly fight that further dissuaded Fox’s audience. The move to settle was a business decision, Lachlan said. “It would have been too much of a distraction” for Fox executives and the network’s audience, he said.
When asked how Fox plans to avoid future lawsuits, Lachlan responded, “We can be CNN.” The network recently aired an interview with Trump, where he called into question the 2020 election’s legitimacy. They haven’t been sued yet, Lachlan said.
Streaming isn’t on Fox Sports’s radar
Traditional television, not streaming, is best when it comes to sports viewership, Lachlan said. “If I were a team owner, I’d want to be on broadcast TV,” he said. The audience for Thursday Night Football shrunk when Amazon Prime Video acquired the rights from Fox.
For consumers, traditional television bundles are the lowest priced, most convenient and have the best reach, he added. Until what is best for consumers shifts to streaming, Fox will continue its sports focus on broadcast television.
Other sports networks have taken a different approach. A shift from traditional television to streaming is inevitable for ESPN, said Bob Iger, CEO of the Walt Disney Company, in a call with analysts in February. The company began building out its sports streaming platform ESPN+ in 2018, and it “actually has grown nicely for us,” Iger said. Many streaming platforms, in addition to Amazon Prime Video, are acquiring rights to sports. Apple TV+ bought the rights to Friday night baseball and Major League Soccer games, and it is reportedly interested in adding Pac-12 football to its list. Comcast-owned Peacock will broadcast one National Football League playoff game next year. Warner Bros. Discovery CEO David Zaslav hinted at expanding the company’s live sports broadcasting through its new Max streaming service at a presentation last month.
Fox is also unlikely to bid on the NBA rights, which are up at the end of the 2024 to 2025 season, Lachlan said.
