Behind the slugfest between Trump-leaning Newsmax and DirecTV

Viewers who have tuned into the conservative news channel Newsmax in recent weeks may think they are watching a telethon.

The Boca Raton, Fla.-based outfit’s anchors have been pounding away at satellite TV provider DirecTV, which dropped Newsmax on Jan. 25 after the two sides failed to come to terms on a new carriage agreement. There have been pleas urging viewers to call the El Segundo-based DirecTV and its majority stakeholder, AT&T, and demand the return of Newsmax to DirecTV’s channel lineup.

Such disputes are common in the pay TV industry, but this one has taken on the look of a nasty political campaign. On air and online, Newsmax has complained, without evidence, that DirecTV’s actions are driven by its disdain for conservatives.

The controversial network has described DirecTV’s action as “de-platforming,” an act of censorship and an attempt to silence conservative voices. Former President Donald Trump — whose rallies continue to give Newsmax its highest ratings — called the move “disgusting” and urged people to cancel their subscriptions to DirecTV and AT&T’s mobile network.

A letter sent by a group of conservative Jewish leaders said the network is “a crucial way for us to reach our fellow Americans” on matters important to their community.

Republican members of Congress — many of whom depend on Newsmax to give them free range to air their views with little pushback — have called for investigative hearings into DirecTV’s action on top of the recent ones held to probe the political motivations of tech companies.

DirecTV executives say Newsmax’s complaints have not had a significant impact on its business, but they are taken aback by the network’s actions.

“Newsmax is using its own newsroom platforms to obscure facts with misleading information — including dozens of daily blog posts, a daily stream of social from corporate media platforms and two-plus hours of on-air programming daily all in pursuit of its own business interests,” the company said in a statement.

DirecTV maintains that its decision to drop Newsmax is strictly business-driven. Pay television providers are under growing pressure as more consumers drop their subscriptions due to rising costs and the popularity of streaming platforms.

“When we’re facing even more intense cost pressure, then we have to squint at that deal extra hard and make that determination for our product and for our customers,” said Rob Thun, chief content officer for DirecTV, in an interview. “And last I checked it’s a free market. Our decision is based on economics, not political ideology.”

DirecTV has offered Newsmax to 13 million subscribers since its launch in 2014 but did not pay a fee as it does for other, more established networks. In its latest offer, DirecTV said it was willing to keep Newsmax in its lineup at the same terms, without any compensation.

Newsmax has argued that it’s worth paying for, asking for about $1 per subscriber annually, due to its audience size and investment in correspondents and anchors. (The network recently added to its lineup Greta Van Susteren, who has worked at both CNN and Fox News.)

Chris Ruddy, chief executive and the majority shareholder of Newsmax Media, links DirecTV’s position to AT&T’s tensions with former President Trump.

Trump’s administration unsuccessfully acted to block AT&T’s merger with Time Warner in 2017 because he was angry over CNN’s coverage of him. The Justice Department filed an antitrust lawsuit, but a judge ruled in favor of AT&T and the deal was completed. (The company later merged Warner with Discovery Inc.)

Several Newsmax hosts are unapologetic advocates of Trump (his former press secretary Sean Spicer has a daily program), and it is the only network that continues to air his campaign rallies live.

Last year, DirecTV dropped One America News, a small San Diego-based right-wing channel that aggressively pushed Trump’s false claims of voter fraud in the 2020 presidential election. OAN, which also was seeking carriage fees, claimed the decision to pull the channel was politically motivated.

“The cost-cutting is always on the backs of conservatives,” Ruddy said in an interview. “They are trying to close us down.”

DirecTV’s Thun disputed the claim, saying it’s a business decision.

Ruddy has a lot riding on his battle with DirecTV, as any deal Newsmax makes can affect the terms of its pacts with other pay TV providers. If Newsmax agrees to allow DirecTV to carry it without fees, other payments could go away as well.

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DirecTV argues that Newsmax is asking its customers to pay for a channel it can get for free as an app and on various streaming platforms. (Ruddy said Newsmax plans to end the stream later this year, replacing it with a news headline service.)

Shortly after dropping Newsmax, DirecTV added another conservative talk channel, the First, which includes such personalities as former Fox News host Bill O’Reilly and Dana Loesch, a onetime spokesperson for the National Rifle Assn.

The First, which also streams for free on a variety of platforms, is not receiving a carriage fee.

Thun said that carrying the First demonstrates a commitment by DirecTV to offer a range of political views.

One of Newsmax’s on-air talking points asserts that DirecTV is willing to give fees to 22 “liberal channels.” The list is dubious as it includes business networks Bloomberg and CNBC, both of which never met a free-market capitalist they didn’t like. The Weather Channel, a cable TV staple, is on the list because it mentions climate change in its coverage of historic storm events.

What most of the channels on the list do have in common is they are part of larger companies that have leverage when negotiating carriage deals. “This is not unique to the right-wing club,” said Tim Hanlon, president of Chicago-based media consulting firm the Vertere Group.

Companies such as Disney, Comcast and Paramount Global can extract higher fees and revenue for their smaller cable channels because they are bundled with network broadcast stations that carry the NFL and other major events.

Newsmax experienced a ratings surge in 2020 when it stood by Trump and his election-fraud claims after Fox News and other networks had declared President Biden the winner. “Sometimes the bank robber gets away with it,” Newsmax host Greg Kelly said on his evening show after Biden’s inauguration. “Joe Biden stole this election. You know it. I know it. Tens of millions of Americans agree with us.”

But two years later, Newsmax has settled at an average viewership of around 100,000, according to Nielsen. Ruddy touts it as the fourth-most-watched cable news network, but it gets a fraction of the 1.5-million viewer average for the conservative-leaning Fox News.

Thun said the ratings for Newsmax are not compelling enough to command fees it would have to pass along to DirecTV subscribers. “We know exactly what people are watching,” Thun said. “And how Newsmax is spinning that they’re some ratings juggernaut — it’s simply not true.”

Hanlon can understand why Newsmax would want DirecTV carriage. Along with the revenue, the conservative TV news audience tends to be older and likely not as technically savvy as most streaming service users.

But Hanlon believes the network is on the wrong side of history, as the pay TV universe gets smaller with no sign of the trend reversing.

“They are fighting last decade’s television battle,” he said. “Consumers are ferociously moving more toward direct streaming and direct-to-subscriber options without the middleman.”