Good morning! Here's the latest on Pat McAfee, YouTube, Karoline Leavitt, Amber Ruffin, The Free Press, OpenAI, "Adolescence," and much more... |
Loyal Newsmax viewers who listened to the channel's entreaties last year and lined up to buy $10-per-share stakes in the company are feeling pretty rich right about now. Those shares are currently worth more than $100 each, a gain of 1000%.
Monday's IPO was a monumental success for the right-wing talk and news channel, and especially for CEO Chris Ruddy personally, since he holds 39.2 million shares. Ruddy became a billionaire on paper in a matter of minutes.
The stock continued to move higher in premarket trading this morning. But the surge may be a sign of overexuberance; it has some media outlets calling Newsmax a new "meme stock."
Investors have plenty of reason to exercise caution if considering buying Newsmax's stock. The company's financials are dreadful. The cable news landscape doesn't exactly scream "growth."
And I think there is another key part of the story that merits more attention. Newsmax was motivated to raise money through an IPO partly due to the defamation lawsuits against the channel stemming from the 2020 election.
This time last year, Ruddy was staring down suits from both Dominion Voting Systems and Smartmatic. There was no way he could afford anywhere near the $787.5 million that Fox paid Dominion. But what if he ran infomercials on Newsmax and convinced viewers to invest?
The entreaties were not subtle. Anchors said things like "we want you to be a co-owner" and Newsmax wants you to join us in keeping America safe and strong." Ruddy sometimes appeared on air for the ads. He recognized a pure-play TV brand would not normally generate Wall Street excitement, so he touted Newsmax's streaming ventures and podcasts. And he likened his IPO plans to Trump's media company stock.
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Given Newsmax's small size, weak TV ratings and history of unprofitability – it lost $72 million in 2024 – some industry onlookers were skeptical the IPO plan would work. Last summer Mediaite, citing Newsmax insiders, cast it as "an effort to stave off financial ruin as the network faces two potentially fatal defamation lawsuits."
In court last fall, a Newsmax lawyer referred to the Smartmatic case as a "bet-your-company case for Newsmax," as CNN's Marshall Cohen reported at the time. But the two sides ended up settling for $40 million. (Newsmax only paid half upfront. The rest is due by July. Smartmatic also had an option to buy Newsmax shares.)
The settlement "and associated legal fees of $76.9 million" were a big reason why Newsmax lost money last year, according to SEC filings. But the on-air ads for the IPO were successful. The channel signed up lots of fans, in spite of the warning in its prospectus about Dominion seeking $1.6 billion in damages.
A key pre-trial hearing in the Dominion case was held a week and a half ago, and a jury trial is scheduled to begin in Delaware on April 28, unless a settlement is reached. (Newsmax denies defaming anyone in 2020.)
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Newsmax's investor presentation uses my words – "Fox News has never seen competition like this" – out of context as an example of "buzz," so here's a quick reality check. At the end of 2020 Newsmax really was gaining on Fox in a couple key time periods, but that moment came and went. Currently Newsmax averages about 200,000 viewers around the clock and Fox News averages about ten times as many. So while Newsmax appeals to the same MAGA base as Fox, it's a stretch to call it a serious competitor.
Furthermore, according to SNL Kagan data about the cable industry, Newsmax doesn't receive per-subscriber fees from distributors.
But maybe "Monday's price explosion," as Deadline called it, really will change Newsmax's fortunes over the long term. Even this morning, the channel is using its talk shows to pump up the stock. Shares approached $120 before the bell.
I texted Ruddy to ask what he thinks the reaction to his IPO signifies, and he wrote, "Last election Americans voted against the media establishment and similarly investors voted by enormously buying Newsmax stock to say they like us, they value us and they want us to grow."
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The 'human cost' of an online rumor |
Two minutes of chatter on Pat McAfee's ESPN show – spurred by an online rumor about an Ole Miss student's sex life – did long-lasting damage to an 18-year-old's life, and now she is exploring legal action. The fallout is chronicled by The Athletic's Katie Strang in this startling new story.
What Strang describes is something much bigger than a single ESPN host. She shows how the hive mind's embrace of a "falsehood about a non-public figure in the pursuit of internet clout or a bigger audience... carries a human cost." Read on...
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'Wrong-headed' ... but probably happening |
Press secretary Karoline Leavitt has scheduled a briefing for 12pm today. Will she say anything about a new White House-controlled seating chart? Yesterday she confirmed that the Trump administration is "seriously considering" bigfooting the WHCA and taking charge of seat assignments.
WHCA president Eugene Daniels spoke out against the possibility, calling it "wrong-headed," and said "the most obvious end result of this reported plan is the punishment, not elevation, of journalists." Speaking to Fox, Leavitt dismissed his concerns, and speaking to CBN, she denigrated the "legacy media" and claimed that true journalists are "few and far between." Here's my latest...
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Last night, "making a drop-in appearance with Seth Meyers (for whom she’s been a writer since he started on NBC's Late Night eleven years ago), Ruffin stepped out and spoke up – not just against the President of the United States but also the journalists who cover him," LateNighter's Bill Carter writes. The three-minute "both sides" clip is on YouTube and is worth watching...
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This week is full of special elections, tariff showdowns, court battles and more. But don't forget about this Saturday's looming deadline.
TikTok's future "is once again uncertain as a potential ban in the United States could be just days away," CNN's Clare Duffy writes this morning. But "loyal TikTok users have reason to be optimistic," since "several interested parties have raised their hands to potentially buy the app, and Trump has expressed a desire to help facilitate a deal." He said again yesterday that there is a "lot of enthusiasm" for buying TikTok, and talked of potentially tying a TikTok resolution to tariff negotiations with China.
Congressional concerns about TikTok being a threat to national security and users' mental stability have melted away for the most part. (Back in January, Trump said he doubted China would care about spying on "young kids watching crazy videos.") And Saturday's deadline may come and go since "Trump has also suggested he could extend the deadline if a deal is not reached in time..."
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👀 on two DC hearings today |
On the House side, Republicans are holding another hearing on the "Censorship-Industrial Complex," this one specifically as it pertains to the State Department. The 10am session promises to be interesting because Nina Jankowicz, who very briefly headed up a Biden-era Disinformation Governance Board, is one of the witnesses. She says this "censorship-industrial complex" idea "is a myth, and a harmful one at that," that is "distracting lawmakers from the real dangers — foreign disinformation and threats to the integrity of our democratic processes." The hearing starts at 10am and is live here.
And on the Senate side, starting at 2:30pm, there is an antitrust hearing titled "Big Fixes for Big Tech." Witnesses will include Digital Context Next CEO Jason Kint. There should be a live stream here.
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Today's new nonfiction releases |
Jonathan Allen and Amie Parnes are out this morning with "Fight: Inside the Wildest Battle for the White House." It is already #2 on Amazon's new releases list, thanks to an excellent PR rollout.
Also new today: NBC correspondent Vicky Nguyen's "Boat Baby," linguist John McWhorter's "Pronoun Trouble: The Story of Us in Seven Little Words," and Maria Shriver's "I Am Maria: My Reflections and Poems on Heartbreak, Healing, and Finding Your Way Home."
Plus: "Who Believed in You?: How Purposeful Mentorship Changes the World" by David McCormick and Dina Powell McCormick, and "Together We Roared: Alongside Tiger for His Epic Twelve-Year, Thirteen-Majors Run" by caddie Steve Williams and journalist Evin Priest.
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As the annual movie theater owner gathering takes place in Las Vegas this week, attendees are gossiping about "high-stakes executive drama" at some of the major studios. THR's Pamela McClintock has a guide to it all here. Warner Bros. Pictures bosses Mike De Luca and Pam Abdy will take the stage this afternoon...
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>> The Free Press announced a raft of columnist additions this morning, including Tyler Cowen, Jed Rubenfeld, Matthew Continetti, and Batya Ungar-Sargon. Plus, Coleman Hughes is moving his podcast under The FP's umbrella. (The FP)
>> Jessica Testa catches up with anchors like Jim Acosta and Don Lemon who are now publishing and streaming on Substack. She says "this new TV diaspora has one central proposition: The future of news is casual. Sometimes very casual..." (NYT)
>> Longtime CNN political analyst Julian Zelizer is now a full-time columnist for Foreign Policy, and he just launched a weekly newsletter called The Long View. (Substack)
>> At The Daily Wire, "top executives are leaving their roles, staffers are being cut, and the dream" of a right-wing entertainment empire "may be unraveling," Oliver Darcy reports. (Status)
>> In a new lawsuit, Fox's Gregg Jarrett "says Simon and Schuster stole his book idea and gave it to Breitbart editor-in-chief Alex Marlow," Daniel Lippman reports. (Politico)
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>> The Atlantic's Elaine Godfrey is out with a profile of White House comms chief Steven Cheung and his strategy of "relentless aggression." Godfrey says the logical end point of his mindset "is the dehumanization of not only one's opponents, but anyone who isn't a loud loyalist."
>> Trump's unconstitutional "third term" talk – and all the ensuing cable chatter – "deflect attention from other controversies," like Signalgate, and "freeze the field of potential successors who might steal the spotlight from a lame duck," the NYT's Tyler Pager observes.
>> Fielding a reporter's question yesterday, Trump said "there's been no sign" of Austin Tice in Syria, but the U.S. will "never stop looking for him."
>> Michael Pack, who tried and failed to blow up VOA at the end of Trump's first term, says in a WSJ op-ed that the broadcaster is broken and "can't be reformed."
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OpenAI tops 500 million users |
...and that's up from 400 million weekly users just last month. "We added... one million users in the last hour," CEO Sam Altman wrote on X yesterday.
But the most newsworthy # yesterday was $40 billion. The company closed "what amounts to the largest private tech funding round on record," with fresh capital that "values the ChatGPT maker at $300 billion." CNBC's Hayden Field and Kate Rooney have more here...
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YouTube is 'new king of all media' |
"If YouTube were a standalone business, it would be worth $475 billion to $550 billion, or about 30% of Alphabet's current valuation," according to a new estimate from research firm MoffettNathanson. It should be crowned the "new king of all media," Michael Nathanson wrote in a note yesterday.
This year, he predicted, YouTube should eclipse Disney as the biggest media company in the world as measured by revenue. Peter Kafka's takeaway: "You're still not paying enough attention to YouTube" as a media force...
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>> "Big brands are allocating small amounts of their advertising budget to Elon Musk's X, seeking to avoid being seen as boycotting the social media platform and triggering a public fallout with its billionaire owner." (FT)
>> "Zuckerberg tries to enlist Trump:" Meta executives "have pressed U.S. trade officials to fight against an expected European Union fine and cease-and-desist order," Sam Schechner and Kim Mackrael report. (WSJ)
>> Yahoo has hired a new chief marketing officer, Josh Line, "to revive a brand that has seen major ownership and leadership changes over the years." (WSJ)
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Entertainment odds and ends |
>> British prime minister Keir Starmer discussed "Adolescence" as "he hosted a Downing Street meeting to discuss the influence of toxic material online" yesterday. Starmer also "welcomed a move by Netflix to make the series available to screen for free in secondary schools..." (BBC)
>> Trump, joined by Kid Rock, "signed an executive order Monday aimed at ending ticket-price gouging for live entertainment." (CNN)
>> Sony previewed "Spider-Man 4," "28 Days Later," "Beyond The Spider-Verse" and more at its CinemaCon panel last night. (CinemaBlend)
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