It took years for Roger Ailes to build Fox News Channel into the dominant player in cable news. It’s taken just two months for its future to become uncertain.
The network took twin public-relations blows on Tuesday, culminating a summer of turbulence. Fox’s parent company, 21st Century Fox, agreed to pay $20 million to former Fox host Gretchen Carlson to settle her sexual-harassment claims against Ailes, the network founder and former GOP strategist who was ousted in July amid widespread allegations of unsavory behavior. The payment, which was accompanied by a public apology by the company to Carlson, is apparently unprecedented in size for an individual sexual-harassment case.
Meanwhile, another Fox host, Greta Van Susteren, abruptly quit the network on Tuesday. She didn’t cite a specific reason, but she took advantage of a contract clause enabling her to leave following the departure of her patron, Ailes. A person with knowledge of the matter said Van Susteren left because of disagreements over contract terms.
The events have cast a shadow over Fox, which Ailes turned into a potent force in GOP politics and a wildly profitable arm of Rupert Murdoch’s media empire since its founding in 1996. Ailes’s success lay in countering other media outlets’ allegedly liberal reporting and commentary by giving starring roles to a series of pugnacious and generally conservative personalities.
The loss of Van Susteren, who occupied the 7 p.m. weeknight slot on Fox, highlighted Fox’s vulnerability to the departure of its stars. Since Ailes’s exit, speculation has mounted about the fate of Fox’s three prime-time “franchise” personalities: Bill O’Reilly, Megyn Kelly and Sean Hannity.
O’Reilly, the most popular figure in cable news, has publicly mused about retiring at the end of his contract next year. Kelly, whom Donald Trump has periodically attacked during the campaign, is also approaching the end of her contract with the network and probably will command interest from Fox’s rivals, such as CNN or ABC.
The most stable of the trio appears to be Hannity, although there has been speculation that he might join a new media venture launched by Donald Trump if Trump loses the presidential race to Democrat Hillary Clinton.
Hannity and O’Reilly have a “key man” clause in their contracts similar to Van Susteren’s that would enable them to leave Fox during a designated period. (In both cases, Ailes was that key man.) Kelly’s contract does not include such a clause.
The departure of any of these figures, coupled with the loss of Ailes’s organizational and message-making skills, would leave Fox greatly weakened, analysts say.
“It would be malpractice” if O’Reilly, Kelly and Hannity’s agents weren’t negotiating new contracts for them now, said Dan Cassino, the author of “Fox News and American Politics.” “Especially at a moment like this, management has to maintain the illusion [to viewers] that everything is fine. They cannot afford to lose a prime-time host.”
Fox was already headed for a turning point after the election in November, argues Cassino, a political science professor at Fairleigh Dickinson University in New Jersey. It hasn’t determined how it will approach a Trump or Clinton presidency, and the loss of Ailes, who masterminded the network’s tone and style for two decades, complicates the challenge, he said.
Without Ailes, Cassino said, Fox will remain generally conservative but could become “much more like CNN or MSNBC,” with a more varied tone and message from program to program, depending on the host.
It’s also not clear how much of Ailes’s inner circle will remain after the election. Ailes so far has been the only senior manager purged by Lachlan and James Murdoch, the sons of Rupert Murdoch who now run 21st Century Fox. But Ailes’s various accusers, including former host Andrea Tantaros, have alleged that his lieutenants — notably Fox News co-president Bill Shine, legal counsel Dianne Brandi and media relations chief Irena Briganti — abetted his behavior, raising questions about their long-term tenure. (They have denied the accusations.)
In a statement issued late Tuesday, Shine and Fox News co-president Jack Abernethy expressed optimism about what lies ahead. “Given we are on track to have our highest-rated year ever and just hit number one in basic cable for the fourth time this year, Fox News has never been stronger and remains dominant in the cable news landscape,” the pair said.
Carlson received not only a huge payout for settling her two-month-old lawsuit, but also an unusual public apology from 21st Century Fox.
The swiftness of the settlement attested to the company’s desire to put an end to the damaging publicity about Fox News’s workplace culture. But it also said something about the strength of Carlson’s claims, said one attorney involved in the matter. The former “Fox and Friends” host reportedly secretly recorded some of her conversations with Ailes in which he suggested that she have a sexual relationship with him.
But the settlement precludes further exposure of salacious or embarrassing details about the Fox newsroom, which Tantaros described in her lawsuit as a “sex-fueled, Playboy Mansion-like cult.”
In another sign of the company’s desire to put the issue behind it, 21st Century Fox said Tuesday that it gave monetary settlements to “a handful” of Fox News employees who had complained about being harassed by Ailes. The company didn’t identify the employees or the size of the payments, but it said the employees came forward during an internal investigation of the claims against Ailes.
Carlson sued Ailes on July 6, saying she was demoted and eventually let go from Fox after she refused his sexual advances. Ailes has repeatedly denied the allegations.
The company’s apology to her, which was attributed in a news release to “21st Century Fox,” read: “During her tenure at Fox News, Gretchen exhibited the highest standards of journalism and professionalism. She developed a loyal audience and was a daily source of information for many Americans. We are proud that she was part of the Fox News team. We sincerely regret and apologize for the fact that Gretchen was not treated with the respect and dignity that she and all of her colleagues deserve.”
The remarkable size of the payment to Carlson “clearly is a recognition that she was right that she was treated inappropriately, and that in and of itself is quite stunning,” said Debra Katz, a Washington lawyer who often represents plaintiffs in sexual harassment lawsuits.
Most companies don’t make such a statement of regret because it could expose them to some risk, employment lawyers said. Fox’s statement suggests that it is open to settling other cases, the lawyers said.
“What Fox is trying to do is demonstrate publicly that this is not business as usual,” said Amy Bess, an employment lawyer at Vedder Price. It is trying “to make a statement to the public that this company is turning over a new leaf. It’s gotten rid of the evildoers, and they’re now focusing on a more positive, proactive, non-discriminatory culture that is a good place for women to work.”
Carlson’s suit brought forth at least 20 other women who said, usually anonymously, that Ailes had harassed them during his long career in television.
Although Carlson didn’t name Fox or 21st Century Fox as defendants in her suit against Ailes, 21st Century Fox will bear the entire cost of the $20 million settlement, both sides said.
Ailes received a $40 million severance package and a continuing consulting role at Fox News when he resigned in July; he also is also an informal adviser to Trump’s campaign.
Van Susteren, who had publicly defended Ailes after Carlson made her accusations, said in a Facebook post that she decided to leave on Thursday.
“Fox has not felt like home to me for a few years and I took advantage of the clause in my contract which allows me to leave now. The clause had a time limitation, meaning I could not wait,” she wrote. She added: “I hope to continue my career in broadcasting.”
Fox said Brit Hume will replace Van Susteren in the 7 p.m. time slot, starting Tuesday night.
Jena McGregor contributed to this report.