Negotiations hit a standstill on Tuesday between DirecTV and conservative cable channel Newsmax, prompting the pay-TV provider to cut loose the pro-Trump network from its lineup.
On the surface, this should have been a typical cable package negotiation in an era of cord-cutting, shrinking subscription numbers, and reduced television revenues. Instead, it looks like it will become yet another salvo in the ongoing culture wars and partisan gripes fueling American politics and cable news.
“On multiple occasions, we made it clear to Newsmax that we wanted to continue to offer the network, but ultimately Newsmax’s demands for rate increases would have led to significantly higher costs that we would have to pass on to our broad customer base,” a DirecTV spokesperson told The Daily Beast shortly after midnight on Wednesday.
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“Anyone, including our customers, can watch the network for free via NewsmaxTV.com, YouTube.com and on multiple streaming platforms like Amazon Fire TV, Roku and Google Play. We continually evaluate the most relevant programming to provide our customers and expect to fill this available channel with new content.”
Just before DirecTV dumped the network, Newsmax published a preemptive article bashing the provider over the likely “deplatforming.” Newsmax CEO Chris Ruddy also accused DirecTV of lying to media outlets about the network demanding carriage fees for its free streamed content.
“That is simply false. DirecTV knows that no operator pays a fee while Newsmax streams free,” Ruddy said.
Following the cancellation, Ruddy called the move “a blatant act of political discrimination and censorship against Newsmax” while complaining that the carrier was paying other channels.
“The most extreme liberal channels, even with tiny ratings, get fees from AT&T’s DirecTV, but Newsmax and OAN need to be deplatformed,” he proclaimed.
“AT&T DirecTV’s de-platforming of Newsmax is the second conservative channel to be cancelled in the past year,” the network said in a statement. “DirecTV believes Newsmax should receive ZERO cable fees, even though it is the 4 highest-rated cable news channel in the nation, according to Nielsen. Newsmax is also a top 16th ranked channel for all of cable in daytime.”
Newsmax also took an indirect shot at Fox News, the conservative cable giant it has attempted to pull viewers from over the past few years. “DirecTV carries 22 liberal or liberal-leaning channels, all of whom get fees. DirecTV believes only one conservative channel should get a fee,” the statement concluded.
DirecTV, a multichannel video programming distributor that currently boasts 13.5 million subscribers, has been locked in an impasse with Newsmax over the channel’s desire to receive carriage fees in a new deal. The current contract between the two companies expires at midnight on Wednesday.
The loss of DirecTV will take a huge chunk out of Newsmax’s current cable footprint, which currently sits at roughly 50 million households. (The network claims it is available in an additional 50 million homes via over-the-top and digital platforms.)
Under their current arrangement, Newsmax has not been paid any license fees to air its programming on DirecTV’s service. This is a typical deal between pay TV carriers and fledgling channels trying to expand their audience. At the same time, DirecTV has carried Newsmax since the channel’s launch in 2014, and the network hasn’t received carriage fees throughout its tenure. (In its recent renewals with Verizon, Dish Network, and NCTC, however, Newsmax now receives such fees.)
While Newsmax made barely a ripple in its first few years of existence, it saw its viewership surge in late 2020 after Fox News’ early (and accurate) election night call of Arizona for President Joe Biden. Blatantly appealing to MAGA viewers dissatisfied that Fox had seemingly abandoned Donald Trump, the channel dove headfirst into election denialism and pro-Trump propaganda and was rewarded with a sharp increase in viewers.
Though the channel’s ratings have crumbled since that brief high, Newsmax still pulls in a much higher viewership than before 2020 and remains fourth among cable-news outlets, behind Fox News, CNN, and MSNBC.
At the same time, the right-wing channel only garners a fraction of its rivals’ audiences, even as CNN and MSNBC have seen their own ratings dwindle in the post-Trump era. In Q4 2022, Newsmax averaged 113,000 total viewers and 170,000 in primetime, and its programming features a bevy of Fox News and Trumpworld castoffs.
Amid the negotiations, DirecTV has made it clear that while it would offer Newsmax programming to its customers under the current arrangement, the network’s demand for additional fees was a bridge too far.
“We deliver Newsmax to our national base of satellite and IPTV customers today at no cost to the programmer or our customers, ultimately offering Newsmax the ability to generate considerable advertising revenue at no cost,” a DirecTV spokesperson said in an earlier statement. “We’ve discussed with Newsmax on several occasions that we’d like to offer their programming, however, the network is now seeking significant fees that we would have to pass on to our broad customer base. Additionally, the same programming offered by Newsmax today is already available at no charge to 100% of U.S. households including our customers via NewsmaxTV.com, YouTube.com and on multiple streaming platforms like Amazon Fire TV, Roku and Google Play.”
In recent years, DirecTV—like most other pay-TV providers—has seen its subscriber base shrink as more customers turn to streaming services and other OTT options. Besides losing tens of millions of subscriptions, the company recently shed hundreds of jobs.
As DirecTV continues to stand firm on not offering Newsmax any compensation, the network has contended that the carrier’s position is ideologically based. “While we cannot comment on negotiations, we expect DirecTV, and its majority owner AT&T, to treat Newsmax on a fair and equitable basis in relation to all of the channels it carries, especially after both companies de-platformed OAN last year,” the network said in a statement Monday night.
An industry source close to Newsmax contended that every other top 75 cable channel that DirecTV carriers (including “liberal” news outlets) receive fees from the provider. This source claimed that Newsmax will end its free live stream in coming months, satisfying DirecTV’s seeming concern over paying the cable outlet for over-the-air content that Newsmax provides for free elsewhere.
During this contract fight with DirecTV, Newsmax has turned to House Republicans to exert pressure on the cable TV giant. Tying the provider’s hardline stance with Newsmax to its decision to drop little-watched conspiracy network One America News last year, GOP lawmakers have accused DirecTV of “actively working to limit conservative viewpoints on its system” while deferring to less-viewed left-leaning channels (specifically citing Vice TV, which is notably not a “news” network).
Rep. Wesley Hunt (R-TX), who has been a frequent guest on Newsmax, authored a letter to DirecTV that was co-signed by 41 of his Republican colleagues. Alleging that DirecTV colluded with Democrats to “de-monetize” right-wing outlets, Hunt claimed the carrier was “moving to de-platform Newsmax by denying it cable fees on a fair and equitable basis.”
Suggesting that Republicans would seek to investigate DirecTV for silencing conservatives, Hunt demanded that the pay-TV provider give Congress the television ratings and “corresponding fees paid by your company” for Newsmax and comparable channels.
“If Newsmax is removed from DIRECTV, in less than a year House Republicans will have lost two of the three cable news channels that reach conservative voters on a platform that primarily serves conservative-leaning areas of the country,” the letter added.
Responding to Hunt, DirecTV reiterated that it had no problem keeping Newsmax under the current deal, pointing out that it allows the conservative channel to sell national advertising. Additionally, DirecTV noted that it provides Newsmax two more minutes of national advertising slots an hour that would otherwise be reserved for local sponsors.
