By Karl Taro Greenfeld
Christopher Ruddy, 49, the chief executive officer and founder of conservative media company Newsmax Media, is giving a tour of his neighborhood in an Acura driven by his chauffeur, Hector. The car heads south on I-95 from West Palm Beach to Boca Raton. It’s the heart of Florida’s Red Belt. Ann Coulter lives a few blocks away—Ruddy spent New Year’s Eve there. Rush Limbaugh is just across the bridge. Donald Trump, David Koch, Patty Mellon Scaife, and a host of other Republican power brokers have homes across the lagoon in Palm Beach. To live among such conservative heavyweights is one reason Ruddy settled in West Palm Beach; the other is that Florida has no state income tax. The headquarters of Newsmax is here, too, off Okeechobee Boulevard; virtually every Republican presidential candidate makes an obligatory visit.
Newsmax, which had revenue of $104 million in 2013, up from $85 million the year before, is perhaps best known for its namesake, 200,000-circulation monthly magazine. A conservative reimagining of the traditional newsweekly, Newsmax publishes political stories such as “President Obama’s Outrageous Power Grab” and ads for gold coins and hearing aids. For conservative politicians, making a Newsmax cover is an important stamp of validation. Newsmax.com, launched in 1998, before the magazine, is the most trafficked conservative site on the Web, with more than 11.5 million visitors in January, according to ComScore (SCOR). On a recent morning, the featured posts on the home page were “Obama Intel Reforms Threaten US Security,” “GOP Poised to Retake Senate as Disillusioned Democrats Depart,” and “Bomb-Strapped Islamists Threaten ‘Present’ at Olympics.” Ruddy has amassed a 5 million-person e-mail list, one reason Republican presidential candidates stop in to see him.
What’s remarkable about Ruddy’s prominence in the Republican media establishment is that he isn’t even a Republican, and Newsmax isn’t a conventional media company. Ruddy has taken Newsmax’s boomer audience, average age 54.7, and figured out how to sell it far more than political news. Newsmax, the corporation, is a smorgasbord of political, health, and financial information, self-help books, and even vitamin supplements constantly pushed through the website and e-mail lists. This eclectic array of products—the company made $46 million in subscription revenue from its 17 newsletters and $6 million from vitamin supplements in 2013—makes Newsmax less of a news business and more of a strange hybrid of the Heritage Foundation and Amway. It was Amway founder Richard Devos who suggested to Ruddy that Newsmax could sell supplements to his middle-aged audience.
Ruddy is registered as an Independent and is more moderate than the rhetoric typically espoused by his media properties. He has become friends with Bill and Hillary Clinton and won’t rule out supporting Hillary for president in 2016. All of which makes his latest ambition, to build a TV network that he believes will challenge the conservative news monopoly of Fox News, either a misguided fantasy or a cunningly disruptive business plan.
For the last 18 years, Fox News, led by its president, Roger Ailes, has exploited its unique slant on the news to generate nearly $1 billion in profits a year for parent 21st Century Fox (FOXA). There’s been no serious conservative competitor to Fox News, and Ruddy has never understood why. (Fox News didn’t make anyone available for comment.) “How do you have something so successful in cable that nobody else wants to imitate or cut into their market share?” Ruddy says. “It defies reason.”
More of article at link:
http://www.businessweek.com/articles/2014-03-06/newsmaxs-chris-ruddy-preps-tv-network-to-rival-fox-news#r=hp-sf
