Rupert Murdoch has cut back plans for a new, Fox News-style television channel to rival GB News, after concluding it is not financially viable.
Rebekah Brooks, the chief executive of News UK, revealed to staff that the huge cost of putting a TV channel on air meant it did not make business sense to push on with the plan.
Instead, she said, the company will focus on reaching news audiences via shows on streaming platforms, adding: “While there is consumer demand for alternative news provision, the costs of running a rolling news channel are considerable, and it is our assessment that the payback for our shareholders wouldn’t be sufficient. We need to launch the right products for the digital age.”
The News UK TV boss, David Rhodes, an American news executive who moved to London last summer to run the project, will be leaving the company in June.
Brooks’ admission that it will be difficult to make a profit from traditional television news will increase scrutiny on the finances of GB News, the Andrew Neil-fronted channel set to launch soon.
It has raised £60 million from the likes of US media company Discovery, Legatum – a Dubai investment company – and Brexit-supporting hedge fund boss Paul Marshall to secure slots on platforms like Freeview.
Centring on presenter-led shows, GB News is hiring dozens of journalists, including presenters like the BBC’s Simon McCoy and Sky’s Colin Brazier.
Brooks said that News UK would still invest in television-style content, with radio stations like TalkRadio producing increasingly professional video content.
She added that News UK would also produce standalone shows, with an aim to make money via personalised adverts on smart televisions, saying: “We have already announced News To Me, an entertainment news show hosted by Gordon Smart, which will drop a new episode each weeknight, and will be viewable live or on-demand via streaming. Other shows are planned.”