The Loudest Voice in the Room: How the Brilliant, Bombastic Roger Ailes Built Fox News--And Divided a Country (29 page)

Friday, October 13, had been a difficult day for Zaslav. Around midday, an NBC researcher told Zaslav about a conversation he had had with Ailes’s ally Scott Ehrlich. Ehrlich instructed him not to talk to Zaslav. In a letter to Ganz detailing the incident, Zaslav also related that his employees reported to him that Ailes was speculating that he was improperly using company funds to strike deals with cable operators. “I am particularly troubled by statements he has apparently made, indicating that he thinks I may be paying off cable operators with CNBC/A-T marketing
funds,” he wrote. He also said that Ailes’s camp was spreading a rumor that Zaslav would be forced out by the end of the week. Zaslav concluded his letter on an ominous note. “I view Ailes as a very, very dangerous man. I take his threats to do physical harm to me very, very seriously and [the threats] have caused, and will continue to cause, great concern for me and my family,” he wrote. “I feel endangered both at work and at home. I plan to seek counsel from Ed Scanlon as to whether I should continue to go to Ft. Lee.”

O
n October 17, the same day that Zaslav wrote about his latest bouts with Ailes, Howard Ganz was scheduled to meet with one of Ailes’s attorneys, Milton Mollen, a retired judge whose specialties included workplace discrimination cases. Ganz planned to detail for Mollen the findings of his investigation. “You should know that I have approached this entirely on merits—as totally neutral outside, independent lawyer/investigator,” he wrote. “I have called it as I see it—period.” Ganz noted that Ailes “was offered opportunity to meet with me, but declined.” Ganz wanted to know “what avenues of possible negotiation do you see?”

NBC was considering two options. One was for Ailes to resign. Ailes and NBC would negotiate the spin they would put on his departure in the press and the exact timing of it, as long as Ailes signed a resignation letter within twenty-four to forty-eight hours. They would negotiate a financial settlement, but given the circumstances NBC was not prepared to pay out his full contract or to provide the minimum for a no-cause termination. If he wanted to remain at NBC—“don’t know if possible, but (speaking off top of head),” Ganz wrote—Ailes would have to apologize to Zaslav, agree to cease his pattern of intimidating verbal abuse, and allow Zaslav to report to someone else.

When later asked about the meeing, Mollen criticized the manner in which Ganz approached the investigation. “He had come to the conclusion that Ailes had made an anti-Semitic remark. I asked him, ‘Well what’s your evidence?’ I was shocked by his answer. I asked if he had conducted a hearing with Ailes. He had not at all.” Mollen noted that Ailes had worked with a number of Jews in his career. “In fact, his first partner in business was a Jewish person,” Mollen said.

NBC drafted “stay” and “exit” alternatives for Ailes. Under the stay scenario, NBC stipulated the terms of Ailes’s apology to Zaslav: “(a) Must formally apologize for and retract anti-Semitic reference and commit
never to making any such reference in the future. (b) Must retract any and all statements that Zaslav reasonably understood as intimidation or threats related to alleged communications that Zaslav had with NBC corporate executives; and must express a commitment not to make any such statements in the future.” Because of business realities, Zaslav would continue to work with Ailes, but NBC demanded that Ailes allow Zaslav to report to him and Tom Rogers.

The exit scenario would include confidentiality clauses, a nondisparagement clause, a noncompete provision with, for example, “CNN/Turner, CBS, ABC, Fox, any Business News Services.” Ailes would agree in addition not to “solicit NBC/CNBC/AT employees for any competitive employment.” Other deal points included “departure announcement by Thanksgiving weekend effective December 31, 1995.… No conduct by R.A. that a reasonable employee would perceive as offensive, intimidating or abusive during the period through 12/31/95.” Ailes would be offered a “consultancy agreement with NBC effective January 1, 1996 through December 31, 1997 with a monthly payment.”

On October 20, Ailes had a letter hand-delivered to Wright and faxed to Scanlon and Welch. Fighting to save his job, Ailes played both the victim and the aggressor. “We have an opportunity to resolve this matter quickly and effectively,” he began. His letter went on:

Meanwhile, Zaslav had been doing his best to avoid Ailes at the office.
But Ailes was getting reports that Zaslav was leaking to the press. “It has come to my attention that David Zaslav has conducted several off-the-record conversations recently with Justin Martin, a journalist with Fortune Magazine,” Brian Lewis wrote in a memo on October 18. “I have not raised this with David yet, but as you know, we have a policy that all media calls must first go through media relations to ensure that one corporate message be distributed.… Please advise.” On the afternoon of
Wednesday, October 25, Ailes showed up at Zaslav’s door and walked in. He reached over and shook Zaslav’s hand in a friendly way. “I like you and I have always liked you,” Ailes told him.

“Thank you,” Zaslav replied.

Ailes seemed armed with talking points to deliver a message. “There’s
been nothing personal in this whole matter,” he said. “At this point, we are just hurting each other’s careers.” Ailes said that if Zaslav reached out to him, the feud would end. “We can find peace,” he said.

“I appreciate that,” Zaslav offered.

“This has been a real war. I don’t like wars, but I am good at them. The thing about wars is that there are casualties,” Ailes said and laughed. “I have been through about twelve train wrecks in my career. Somehow, I always walk away.”

It must have been unclear if Ailes was trying to apologize to him or threaten him.

“I am a deeply spiritual man,” Ailes continued. “It is not for me to pull the noose tighter on your or anyone else’s neck. Our Maker does that. You can get some sleep now.… You don’t have anything to worry about from me.”

“Thank you,” Zaslav said.

Ailes walked out of the office. Zaslav quickly typed up the conversation and sent a transcript of the encounter to Scanlon.

NBC executives were at a crossroads.
“It was a he-said, he-said situation,” Wright said. “If they could come together, I would have been satisfied … but that didn’t happen.” Ailes did not take the exit alternative, and executives continued to worry about the episode leaking to the press.
At a staff meeting on the morning of October 30, Ailes began by declaring, “I feel like General Patton. I’m afraid they will find out I love war.”

On November 10, Ailes reached an agreement with NBC and kept his job. “Ailes agrees to work constructively and harmoniously with Zaslav in the best interests of NBC, CNBC and AT,” the agreement stated. It added: “During his employment by NBC/CNBC, Ailes agrees that he will not engage in conduct that a reasonable employee would perceive as intimidating or abusive. If, as determined by Scanlon, Ailes engages in such conduct, that conduct shall … entitle NBC to terminate the June 30 Agreement and Ailes’ employment thereunder.” A separate agreement between Ailes and Zaslav, which both men signed, ended the battle, in which “certain disputes and disagreements have arisen between or among the parties.”

“There was no apology. There was no admission of any wrongdoing,” Milton Mollen said.

On November 21, NBC announced that Zaslav had been promoted to executive vice president for cable distribution and domestic business development.
One Ailes loyalist remembered how, before long, Zaslav
began showing up to work in a gray Porsche 911, which he parked in a handicapped parking spot so it did not get scratched. “Roger walks with a limp. Of course it pissed him off,” the source said.

The agreement did little to ease the tensions.
In late November 1995, Ailes and Zaslav traveled to Anaheim, California, to the Western Cable Show, a major industry conference.
“It was very, very uncomfortable,” one staffer later said. “Roger was not speaking to David, David was not speaking to Roger. And here they were, being the face of CNBC.”

Though Ailes had stayed, it became clear that he had little future at NBC. Wright and Welch ruled out the possibility of Ailes running the new NBC-Microsoft cable news network, even though Ailes lobbied Wright to change his mind.
“He said he would run it for Gates,” Wright recalled Ailes telling him. “I said, ‘It has to be NBC News.’ ” Wright tried unsuccessfully to convince Ailes to remain in charge of CNBC. Ailes could not accept the offer. In an instant, he was being demoted from Wright’s heir apparent to essentially a cable news producer in charge of CNBC’s programming.

Ailes, however, showed no signs of backing off in public.
“I love competition,” he told a
Newsday
reporter shortly after the Zaslav episode. “That’s why I get up in the morning.”

O
n December 14, 1995, Ailes paced his office in Fort Lee, watching his career implode on a television monitor. America’s Talking, his baby, was being ripped from his hands, and it was all happening in public.
On-screen, Bob Wright walked to the podium at 30 Rock’s Studio 8H, the iconic set of
Saturday Night Live
, to open a press conference, flanked by Jack Welch and Andy Lack. Bill Gates and Tom Brokaw participated by video linkup. Wright confirmed the talk of the media industry for weeks: NBC and Microsoft were launching a new cable news channel named MSNBC, and Andy Lack, the flashy president of NBC News, would be in charge of its programming.
Microsoft was investing $220 million in the 50-50 joint venture, and would pay NBC a $20 million annual licensing fee to distribute its news programming online. MSNBC would take over the America’s Talking slot on the cable dial—and Ailes’s channel would be dead.

The press conference was a response to the Time Warner–Turner Broadcasting System merger, which had been announced on September 22.
The staggering $7.5 billion deal spurred CNN’s rivals to take aim
at Turner’s cable news monopoly, lest they get left behind.
In early December, ABC’s blustery news chief, Roone Arledge, announced that ABC was planning to launch a twenty-four-hour cable news channel.
Speaking to a group of business leaders in Boston around the same time, News Corp chairman and CEO Rupert Murdoch also announced his intention to launch a twenty-four-hour news channel. For Murdoch, the rivalry with Turner was personal.
Just a few months earlier, in August 1995, Murdoch had had his own backroom talks with Turner in hopes of acquiring CNN, and had gotten nowhere.
A day after Murdoch’s announcement that he would start a “really objective” channel, Turner declared at the opening session of the Western Cable Show that he looked forward to “squishing Rupert like a bug.” The battle lines were drawn. Despite Turner’s public bravado, he was unnerved by Murdoch’s advance.
“From CNN’s earliest days, I was concerned that someone would come after us with a right-wing network,” he later wrote in his memoir,
Call Me Ted
. “Now it was happening.”

NBC was determined to beat ABC and Murdoch’s News Corp into the market, but there was one thorny matter to resolve. Behind the choreographed rollout of its Microsoft partnership, the internal conflict around Ailes was never far from view.
One reporter asked the executives how Ailes had reacted to America’s Talking being replaced with MSNBC. “Roger’s been involved in these discussions for some time,” replied Microsoft executive Peter Neupert, convincing no one. Ailes, Neupert claimed, would “be actively involved in this as it goes forward.”

“Fuck them,”
Ailes said, pacing around his office as his assistant, Judy Laterza, and Brian Lewis looked on. “Fuck them.”

Ever since his truce with Zaslav, Ailes continued to be unable to adapt himself to the constraints of his corporate environment. He persisted in offering political advice to his old Republican friends.
“I remember Dan Quayle would call all the time,” one A-T producer said. In December, Ailes’s political ties burst into public view when
Vanity Fair
published a lengthy article on conservative magazine publisher Steve Forbes, who was mounting a 1996 presidential campaign and had turned to Ailes for informal media advice.
When
The Washington Post
asked Ailes about it, he lashed out. “I’m a friend,” he said. “It’s like meeting a doctor at a cocktail party. If he asks me, ‘What do I do if it hurts under my arm?’ I give him an answer.… What I do in my private life is my business, period.”

Ailes sought to put out other fires. On December 1, 1995, Ailes’s divorce entered the public record.
Ten days later, his friend Liz Smith put
out word in her
Newsday
column that Ailes was officially a bachelor. “New York hostesses are forever searching for ‘extra men’ to fill out their tables. Ladies who aren’t dead yet are forever saying that a good man is hard to find and there aren’t enough to go around. Both types will be happy to hear that Roger Ailes is a free man—divorced from his wife of over a dozen years,” Smith wrote. “Roger says he is looking for a fine woman who is not ‘high maintenance.’ (He is paying hefty alimony).”

Over the Christmas holiday, Ailes flew to his condo in Florida to strategize. During his stay, he drove over to Jack Welch’s house in Palm Beach to talk about his future at NBC. Despite their friendship, Welch backed Wright’s moves to give MSNBC to Lack, a decision he clearly understood might lead to Ailes’s departure.
“We both realized there were people who didn’t want him there anymore,” Welch remembered. “We talked a lot. This was a sad thing for both of us in a way.” It was a decision Welch later regretted. “Losing Roger was tragic for the business,” he said.

When Ailes returned, his lawyers and NBC drew up a separation agreement.
On January 9, 1996, Ailes and Scanlon signed the extensive paperwork. NBC agreed to pay Ailes $1 million to walk away, as well as his $250,000 incentive compensation and $100,000 in lieu of his stock option benefits. They agreed to a mutual nondisparagement clause and to release an announcement no later than January 26 and “in principle … to have NBC say favorable things about Ailes and wish continued success and … to have Ailes say favorable things about CNBC, NBC, Bob Wright and Jack Welch and wish them continued success.” The agreement barred Ailes from taking a job at CNN, Dow Jones, or Bloomberg while receiving his payout from NBC, but said nothing about Rupert Murdoch’s News Corp—a detail that would have historic consequence.