Sarah Palin's announcement that she wouldn't run for president disappointed her legions of admirers — but it infuriated Roger Ailes. The Fox News chief wasn't angry about the decision itself. Rather, he was livid that Palin made the October 5 announcement on Mark Levin's conservative talk-radio program, robbing Fox News of an exclusive and a possible ratings bonanza. Fox was relegated to getting a follow-up interview with Palin on Greta Van Susteren's 10 p.m. show, after the news of Palin's decision had been drowned out by Steve Jobs's death. Ailes was so mad, he considered pulling her off the air entirely until her $1 million annual contract expires in 2013.
After the announcement, he called Fox's executive vice-president Bill Shine into a meeting. Shine is the network's principal point of contact with Palin. Ailes told him she had made a big mistake. "I paid her for two years to make this announcement on my network," Ailes pointedly told Shine. Sources described the episode on condition of anonymity, given the sensitivity of the relationships.
Palin is said to have made her announcement on Levin's show because she's been upset that Fox News has given a platform to Karl Rove, one of her principal critics. "She isn't happy with Karl," one Palin adviser told me. "From day one, he hasn't been very nice." Levin had become Palin's biggest booster in the conservative commentariat, and Palin is known for rewarding loyalists, and punishing her detractors.
Shine was deputized to handle the matter. He spoke with Palin's agent, Bob Barnett, and told him that Ailes was furious with Palin's move and that she was at risk of being "benched." Fox still had to pay her, but they didn't have to give her airtime. Barnett spoke with Palin and told her about the problem. After she apologized, he called Shine back and told him that Palin recognized the misstep.
But tensions between Palin and Fox haven't subsided. Ailes, who told Newsweek that he hired Palin when she was "hot," clearly hoped she would boost ratings. But beyond her prime-time commentary, Palin hasn't turned into the television asset Ailes had hoped. Palin's contract is up in 2013 and it's unclear what the current fracas will mean for her future on Fox News. Part of her appeal as a pundit was that every appearance on the network was turbocharged by the "will-she-or-won't-she run" speculation. She's now given up that chip to play. But Palin knows that she still has value as a gatekeeper to her grassroots base. A Palin adviser told me that she is planning to make an endorsement for a candidate in 2012. Palin, being Palin, is keeping it tightly held. "I have an idea of who it is," the adviser said, "but I'm not telling." What's clear is that Palin would be smart to make that announcement on Fox News.