A GOP Debate Without Donald Trump Likely Won’t Crimp Fox’s Wallet - WSJ

Jan. 28, 2016 3:29 p.m. ET

Donald Trump earlier this week said he would skip Thursday night’s Fox News debate in Des Moines, Iowa. Since then, the Republican presidential candidate has been taunting Fox on social media, suggesting that his absence will hurt Fox’s ratings and advertising revenue.

“The ‘debate’ tonight will be a total disaster - low ratings with advertisers and advertising rates dropping like a rock,” Mr. Trump said Thursday on Twitter. “I hate to see this.”

But it turns out Mr. Trump’s absence, while a public relations controversy for Fox, won’t likely have a significant financial impact on the cable TV network or advertisers, ad buyers said.

Fox sold much of Thursday night’s ad inventory in the so-called scatter market, where ad time is sold closer to the airing of a program instead of in an advance deal, according to ad buyers.

Such ad deals generally do not carry a ratings guarantee, meaning a TV network isn’t on the hook to compensate marketers with free ad time if viewership falls short of what was expected.

To be sure, there are some risks for Fox. Big buyers can sometimes negotiate to have a guarantee included in their scatter deals. And some advertisers did buy ads in the advance “upfront” market, where guarantees are part of deals, a person familiar with the situation said.

In a statement, Fox News said, “The debate is completely sold out. No rates have changed and there are no advertisers who have backed out. Prices don’t change once the orders have been placed.”

In an interview, Paul Rittenberg, executive vice president of ad sales for Fox News and Fox Business, said he doesn’t anticipate having to give free ad time, or “make-goods,” to advertisers who locked in audience guarantees. “I think a lot of people are going to tune-in,” he said. “If we have advertisers who have a problem we’ll address it.”

He added that advertisers with guarantees are “well ahead of the game,” since past debates have had higher-than-expected viewership.

“We’re not going to lose any money from this,” Mr. Rittenberg said.

Some ad buyers agreed. “I don’t believe that Fox will take a big financial hit,” said Rino Scanzoni, chief investment officer of GroupM, the largest ad-buying firm in the world.

Ad time in Thursday’s debate went for as much as $260,000 for 30 seconds, the person familiar with the situation said. However, spots sold after Mr. Trump pulled out went for roughly $200,000, which is still a premium rate for a debate.

Fox News is owned by 21st Century Fox,FOX2.50% which until mid-2013 was part of the same company as Wall Street Journal owner News Corp.NWSA1.17%

Mr. Trump plans to skip out on the debate after protesting that anchor Megyn Kelly will again be a moderator. He lashed out at her after the first GOP debate for a line of questioning about his views on women, saying she is biased. Fox News has come to her defense, and has said it doesn’t want a candidate to dictate who can be a moderator at its debate.

Mr. Trump said he will hold a competing event Thursday night, a fundraiser for veterans. CNN and MSNBC, Fox’s cable news rivals, have said they plan to dip in and out of coverage of his event, which could potentially siphon some viewership away from the debate.

There’s little doubt Mr. Trump has given the debates a ratings boost, especially at the first one Fox News held last August. Interest in the brash New York businessman was a major reason that debate brought in an audience of 24 million. Viewership since then has gone down, and the last debate on the Fox Business Network on Jan. 15 drew about 11 million viewers.

Ad prices for the earlier debates have also been robust. A 30-second spot on the Nov. 10 debate that aired on Fox Business cost roughly $120,000, a big increase from the network’s typical ad rates, according to one buyer.

Advertisers “like the entertainment that Trump has brought to the debates,” said one ad buyer. “It really helped the ratings.”

Still, it’s possible that the drama surrounding Trump’s absence could create interest and buoy viewership on Thursday, some ad buyers said.

Write to Suzanne Vranica at suzanne.vranica@wsj.com and Joe Flint at joe.flint@wsj.com