Will the Murdochs back O’Reilly — or show him the exit? Photo: Ilya S. Savenok/Getty Images

With only six days remaining in Bill O’Reilly’s vacation, the pressure on the Murdoch family to decide the embattled commentator’s fate is intensifying. Three sources with knowledge of the discussions said that, while no final decision has been made, the Murdochs are leaning toward announcing that O’Reilly will not return to the air. Sons James and Lachlan have been arguing that O’Reilly needs to go, say these sources, though their father, Rupert, has resisted that outcome.

The prospect of dumping O’Reilly — once unimaginable — has gained steam this week due in part to street protests outside Fox News headquarters and advertiser boycotts on O’Reilly’s air. One network insider said Fox executives are alarmed by the severity of the ad-revenue decline. “It’s worse than Glenn Beck,” the insider said, referring to the advertiser revolt that helped derail Beck’s Fox News career in 2011.

Here’s how Bill O’Reilly dealt with the vacation on his show.



Another factor: the Murdochs’ pending $14 billion takeover of European pay-TV provider Sky. On May 16, the British media regulator Ofcom is set to judge whether the Murdochs are “fit and proper” to own such a large media property. Removing O’Reilly could appease critics and help close the Sky deal. (In 2011, the Murdochs abandoned their initial takeover offer for Sky after the London phone-hacking scandal.)

Meanwhile, the Murdochs are also dealing with a restive workplace. Female Fox News employees are growing increasingly frustrated that the Murdochs have not forcefully confronted the company’s culture of sexual harassment in the wake of removing Roger Ailes. “Morale is awful,” one Fox female executive told me yesterday, adding that employees are wondering if budgets have been cut to pay for sexual-harassment settlements. “There’s been no word from management to calm the masses.” (Spokespersons for 21st Century Fox and Fox News did not respond to a request for comment.)

Sources describe the Murdoch family discussions as fraught. Initially, according to sources, Lachlan was aligned with his father, but in recent days he has leaned more in his brother James’s direction. “The three are fighting,” the insider said. In some ways, deciding O’Reilly’s fate is more complicated than the decision to oust Ailes last summer. O’Reilly is Fox’s highest-rated host and the linchpin of the prime-time schedule, so his removal could have immediate effects on the network’s ratings. And according to one Fox source, Rupert has told people he does not want to fire O’Reilly because it would make it appear he was forced into a decision by “the New York Times.”

Rupert Murdoch built his media empire without paying much attention to corporate norms and rules, but his sons showed with the ouster of Ailes that they wanted to run a different kind of company. What happens to O’Reilly will tell us more about who is winning the intergenerational battle over 21st Century Fox.