Newsmax Takes on Fox News in Court, Alleging Anti-Competitive Behavior
Underdog conservative channel Newsmax is challenging Rupert Murdoch’s dominant Fox News in court, accusing the media giant of engaging in anti-competitive behavior to maintain its grip on the right-leaning pay TV news market. In a federal lawsuit filed in Miami, Newsmax alleges that Fox has used its market clout to discourage pay-TV distributors from carrying or promoting Newsmax and other rival conservative news outlets.
Accusations of Exclusionary Tactics
According to the lawsuit, Fox has imposed financial penalties on distributors if they carry Newsmax in basic cable packages, and has charged higher fees or required carriage of little-watched channels like Fox Business. Newsmax claims that these tactics have resulted in the suppression of competition in the market, harming consumers and Newsmax Broadcasting. The lawsuit also alleges that Fox throws its weight around when striking deals with digital media platforms, including Hulu + Live TV, DirecTV+, Sling TV, and YouTube TV, which now make up about 30% of the pay-TV market.
Newsmax argues that Fox’s commanding position has allowed the company to extract “supra-competitive carriage fees,” with Fox charging pay-TV distributors nearly $2.20 per subscriber per month to carry Fox News. This is double CNN’s fees and about six times MSNBC’s carriage fee, according to Newsmax. The company claims that these inflated costs have been or likely will be passed on to consumers.
A Market Dominated by Fox News
Fox News consistently beats CNN and MSNBC in the Nielsen ratings, and was the No. 1 traditional TV network overall this summer, beating ABC, NBC, and CBS. Newsmax alleges that Fox News resorts to intimidation campaigns, including pressuring guests not to appear on Newsmax, and has even hired private investigators to target Newsmax executives and damage the company’s credibility.
Newsmax contends that the market for right-leaning pay TV news is a distinct market, controlled almost entirely by Fox. The company argues that a large segment of consumers of political news and media seeks news, commentary, and analysis that aligns with or speaks to their political viewpoints, and that these right-leaning viewers do not consider left-leaning news outlets as adequate substitutes for right-leaning news channels.
Seeking Justice and Fairness
Newsmax is seeking a jury trial and unspecified financial damages, and wants a judge to declare Fox’s conduct unlawful under the Sherman Act and Florida’s anti-competition laws. The company also wants to prevent Fox from striking exclusionary contracts. “This lawsuit is about restoring fairness to the market and ensuring that Americans have real choice in the news they watch,” Newsmax Chief Executive Christopher Ruddy said in a statement.
Read more about the lawsuit and the allegations against Fox News Here
Image Source: www.latimes.com
