How Fox got ahead on the big media future

If you want a glimpse of the coming consolidation in digital media, take a look at Fox Corp., which has been executing an accelerating roll-up of independent media stars.

Fox, which includes Fox News, Fox Sports, and the ad-supported streaming platform Tubi, has in recent months announced acquisitions of or partnerships with Ruthless; the podcaster Brett Cooper; Dave Portnoy’s Barstool Sports; and Red Seat Ventures, the ad sales and infrastructure for former Fox News stars Megyn Kelly, Tucker Carlson, and Bill O’Reilly, as well as Piers Morgan and others.

The exact shapes of the deals vary, but they represent a dramatic change from an era during which Fox was known for keeping a tight, exclusive hold on its talent. And they’ve taken place as Fox’s old-media competitors continue to nervously dip their toes in the waters of the independent creator space.

“In the past, a lot of linear networks have needed exclusive deals to own the talent — but the creator economy doesn’t work like that,” Paul Cheesbrough, CEO of Tubi Media Group, said in an interview with Semafor last week. Creators “need to coexist on those organic channels.”

At the core of Fox’s success is a rethinking of the relationship between corporate media and talent. Up-and-coming radio hosts and pundits used to scramble for exclusive contracts with a small number of big media employers. Now, media companies need to prove their worth to well-compensated independents who can take or leave the corporate relationship — but whose small businesses also have their own stresses and commercial gaps.

“The creator economy is a relatively fragmented value chain,” Cheesbrough said. He ticked through Fox’s value-add for these stars: It can produce, distribute and do large-scale ad deals through Red Seat. It can market to large, less-online audiences through its television networks. And it continues to shop for acquisitions among “companies that can help creators monetize more effectively,” Cheesbrough said. In that vein, the company recently bought the podcast adtech company Backtracks.

“Red Seat is an example of giving us this optionality, and Brett Cooper is an example of someone who wants to go direct-to-consumer with her own shows — but understands that she can reach a different audience through Fox News,” he said.

The new creator tie-ups, of course, also solve a particularly urgent problem for Fox: its aging audience. “We’re always striving to reach the maximum number of people and get to the younger audience,” Cheesbrough told me.

Cheesbrough also believes that the podcast world is fast accelerating toward television. “If you’re producing a podcast without video overlaid over it, you’re missing a big opportunity,” he said. “Video’s going to be the dominant factor.”