Fox News has to renegotiate 60% of their cable contracts soon
Link to tweet
Link to tweet
4/ By now though, most people know that advertising revenue is really just gravy on top for Fox. They could have $0 in ad revenue and they'd still have a 90% profit margin. That's because they have guaranteed revenue from cable companies.
5/ Every cable company pays a fee to channels to carry them - it's called a carriage fee. It's usual a nominal fee though. Not for Fox News.
Fox News is the second most expensive channel on every one's cable bill (ESPN is #1). And that is by design.
6/ About 10 years ago, Fox News set out to leverage their rabid audience and insulate themselves from pressures of the ad industry.
I won't get into how they did it. But short of it is, they lied and bullied their way into getting cable companies to massively overpay for Fox News.
7/ Why's this matter? Well, Fox News has to renegotiate about 60% of all their cable contracts over the next year.
And they not only need to keep their currently inflated rate, they need to actually increase it by quite a bit to offset the ad losses.
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Something you can do: go to https://unfoxmycablebox.com/ and tell your provider you don't want to be forced to pay for deceptive programming.
Hey, it's something!
= new reply since forum marked as read
...increases were by design (as asserted here) as a result of the Glenn Beck fiasco. Beck ended up having just about every major advertiser bail on him during his short tenure at Fox News. They pretty much had to insulate their shows from commercial pressures, at least if they wanted to continue to go farther and farther to the right with no trend toward moderation. 
It is true that the per subscriber licensing (or "carriage"
fee that Fox News charges is one of the highest in the industry, it is not the second highest. The highest is ESPN, which charges over $7.50 per sub. Second is TNT, which is in the neighborhood of $2.20 per subscriber. Third place belongs to NFL Network and then comes Fox News, at around $1.70/sub. (USA Network is next in line, with fees of around $1.65 sub).
More significantly, the notion that Fox (or any of the other cable networks) have a "profit margin" of more than 90% is pure hogwash. THat's not to say Fox isn't profitable -- its profit margin is between 35 and 39 percent.
Also significantly, Fox News, by itself or even when combined with Fox's other cable networks (Fox Sports, Fox Business) is not the largest source of revenue for Fox Corporation. The broadcast channels and the Fox television network are. For the most recent quarter, Fox reported $4.6 billion in revenues. Of that amount, $1.6 billion was attributable to the Fox cable networks (including, as noted above, not just Fox News). And of the $1.6 billion attributable to Fox cable networks, $1.3 billion came from the fees cable and satellite distributors pay to carry those networks. In contrast, the broadcast television side of the business delivered $2.93 billion in revenues during the last quarter, most of which came from advertising.
Finally, the cable network revenues actually declined from the quarter ending 12-31-22 compared to the quarter ending 12-31-21 because the number of cable and satellite subscribers has been declining. That creates an incentive for Fox to hold the line or even demand higher fees from cable and satellite.
https://www.prnewswire.com/news-releases/fox-reports-second-quarter-fiscal-2023-revenues-of-4-61-billion-301741921.html
As for 60 percent of Fox's agreements expiring this year -- hard to know. The company announced it had entered into "long term" agreements with Comcast in 2020 and with Dish, Cox and Charter in 2019. It reached an agreement with DirecTV this past December. If those agreements were only for 3 or 4 years, then it may be that contracts representing 60 percent of the subscriber base may be up for renewal this year. But I wouldn't expect any major decreases in the fees charged when those agreements are renewed -- there is no indication that Fox reduced what it charges DirecTV.
Fox News is terrible. But it doesn't help anything to make up facts when discussing the economic realities of the Fox channels.
Thank you 😊 
