Yesterday, Fox News fired Tucker Carlson, cable news’s most popular prime-time anchor, setting off an uproar in the media and politics. Few expected that the fallout from Fox’s $788 million defamation settlement with Dominion Voting Systems would reach Mr Carlson, who has millions of followers and the support of Donald Trump.
But Fox and Rupert Murdoch, accustomed to controversies and legal settlements as costs of doing business, may have decided that getting rid of Carlson was a smarter financial move.
The influence on Fox is undeniable. Mr. Carlson has become the brightest star on the Fox News track since being awarded primetime programming in 2017, with “The Tonight Show with Tucker Carlson” averaging more than 3 million viewers per night.
While the show doesn’t have top advertisers, many of whom are held back by his frequent controversies, his strong audience numbers could have helped Fox News in its upcoming negotiations with cable providers over how they pay for its network. (Fox shares fell 3% yesterday — a steeper drop than the company’s drop after its settlement with Dominion last week.)
Mr. Carlson’s contract is worth $20 million per year and is expected to be paid.
His dismissal was quick. Fox CEO Lachlan Murdoch, with her father’s blessing, conferred with Fox News chief Suzanne Scott on Friday about firing Carlson, with the host reportedly closing in just 10 minutes before the announcement. Here comes the notification.
Mr. Carlson may have gotten too hot to handle:
The Dominion lawsuit uncovered Carlson’s private comments in which he routinely profaned colleagues, sources and, perhaps most importantly, his boss.
A former producer is suing Fox News after accusing Carlson of overseeing a hostile and discriminatory work environment.
The Murdoch family are reportedly tired of trying to bring together a controversial presenter who proudly says he cannot be contained.
Then again, Max Tani of Semafor pointed out that firing Mr Carlson was just the latest abrupt and seemingly capricious move by Mr Murdoch. Others wondered if there were bigger shoes that could fit.
Murdoch clearly wants Carlson to be replaced. This was the case before Fox ousted big names like Bill O’Reilly. But the outpouring of support for the hosts from Mr. Trump and conservatives suggests that this time it will not be taken for granted. It’s not clear where Carlson will go next — with rival outlets like Newsmax beckoning him, as is his own strike and entry into politics.
Mr Carlson wasn’t the only media star at the door yesterday. CNN ousted anchor Don Lemon hours after his appearance. (Among the reasons: some guests didn’t want to appear with him on the show after he came under fire for sexist comments, and internal CNN research suggested his popularity with viewers was waning.)
Mr. Lemon didn’t take the news well — “I’m shocked,” he tweeted — and hired the same lawyers as Carlson to negotiate his exit.
this is what happened
President Biden announced his re-election bid. In a three-minute video posted this morning, he urged voters to let him “get the job done.” The widely expected move puts him at risk for another fight with Donald Trump. Biden is expected to meet with major donors later this week.
UBS has attracted billions of dollars in new client funds. The Swiss bank said today that it acquired $28 billion in new assets in the first quarter, including $7 billion after announcing a deal to buy Credit Suisse. During the same period, its battered rival lost $69 billion in client funds.
The appeals court has largely sided with Apple in its fight against Epic Games. A three-judge panel of the U.S. Court of Appeals for the Ninth Circuit ruled that the iPhone maker’s control over its App Store did not violate antitrust laws. But the judges also said developers should be able to steer users to payment systems other than the App Store, thereby avoiding charging Apple.
Disney’s most recent layoffs included an ESPN executive. The media giant started a new round of layoffs yesterday, including Russell Wolff, who oversaw the ESPN+ video service. Cutting streaming costs has been a top priority for Disney CEO Bob Iger as he moves to slim down the company.
Coinbase sues the SEC The lawsuit seeks to force the regulator to respond to a rulemaking petition filed by cryptocurrency exchanges calling for more clarity on enforcement policies. Previously, Coinbase disclosed that the agency was investigating the company for possible violations of securities laws.
first republic seeks help
First Republic’s brutal quarterly earnings report sent its shares tumbling yesterday after the bank revealed customers withdrew billions of dollars in deposits, profits fell by about a third and it planned to cut jobs by a quarter. Withdrawals have eased, and the worst may be over after the country’s largest lender last month provided a $30 billion bailout to Bank of California.
But First Republic still needs to trim its balance sheet and cut its losses. The question is how.
The results revealed the depth of the problem. Clients pulled $102 billion from First Republic last month, well over half of the $176 billion they held at the end of last year. During the same period, it borrowed $92 billion, mostly from the Federal Reserve and government-backed lending syndicates. These loans help stabilize their finances, but are more costly than using customer deposits.
(There’s some good news: First Republic says it retains 90% of its advisors in its wealth management division.)
what’s next DealBook has learned that the bank wants the government to push the country’s largest lender to come up with a more permanent solution to its problems than the last one. That doesn’t mean the government injects money itself, but it means calling in the big bank bosses and putting pressure on them to find a solution.
This is far from ideal for the government, Especially considering the bank primarily caters to the wealthy. But the failure of the First Republic would pose broader risks, adding more pressure to the banking system at a time when small lenders are still vulnerable.
It will also revisit the question of whether the government plans to back all uninsured deposits. (Treasury Secretary Janet Yellen has mixed messages on this front.) Any bank failure would likely deal a blow to the government’s insurance deposit fund, which is funded by taxes on banks.
The big banks weren’t committed, and the First Republic’s massive losses probably didn’t help. Given the bank’s recent big gains, the government has also refrained from going as far as it did in 2008, when it pressured JPMorgan to buy Bear Stearns (a move JPMorgan CEO Jamie Dimon has long bemoaned).
The window to strike deals before the industry takes another major hit may be closing. “First Republic’s standalone earnings profile remains worse than we feared,” wrote analysts at Autonomous, expressing surprise that the stock was down no more than 20% after hours. “We will be very cautious.”
— Yesterday’s stock market capitalization reached LVMH, the French luxury goods group, making it the first European company to do so. The company’s shares soared on the back of buoyant sales in China, making its founder Bernard Arnault the world’s richest man.
An open source battle goes to court
Jack Dorsey, co-founder of Twitter and payments firm Block, launched the Bitcoin Legal Defense Fund last year to help developers of the cryptocurrency. But its first case, scheduled to be heard in a UK court tomorrow, could have wider implications for the tech industry and the whole philosophy of open source software development.
The lawsuit claims that the open-source developers were responsible for the theft. A Seychelles-based cryptocurrency firm is suing a group of developers who contributed code to the bitcoin network, the decentralized set of computers that keep track of all transactions. The network is an open source project, and like most software of this type, it was created under terms allowing free use and disclaimer.
Australian developer Craig Wright – who also claims to be the man behind the pseudonym of bitcoin creator Satoshi Nakamoto – lost access to a digital wallet containing 111,000 bitcoins after his home computer was hacked in 2020. His company, Tulip Trading, claims that Bitcoin programmers control the open-source network and are responsible for preventing illicit transactions. Last year, a British court dismissed the case on jurisdictional grounds, but that decision was overturned in February following an appeal.
Open source model encourages collaboration and innovation, which has been critical to software development for decades. Programmers generally do not gain a direct financial benefit from participating. Instead, they share their skills to build and earn credibility within the coding community.
“These lawsuits could have a serious detrimental effect on open source development, which will have a negative impact on our lives, and we may not even realize it until it’s too late,” Mr. Dorsey said.
The defendant in the case, Greg Maxwell, told DealBook that he began researching the bitcoin network in 2010 because he was interested in the idea of money without intermediaries. But he stopped after he was charged. “If there’s a responsibility, people won’t participate,” he said.
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