Megyn Kelly’s attempt to go from a hard-nosed prime-time interviewer of world leaders on Fox News to a chipper morning host at NBC’s “Today” came to an abrupt end Friday when the network canceled her show.
But the network’s $69 million bet on Ms. Kelly—meant to add rocket fuel to its morning-show ratings—was troubled from the start.
The anchor battled low ratings and a rocky transition to morning television amidst tensions among some NBC colleagues, who chafed at her on-air manner, lofty salary and the high cost of producing her show.
The final straw came this week, after Ms. Kelly questioned on Tuesday’s edition of her show why putting on blackface as part of a Halloween costume was necessarily racist.
The backlash played out within NBC News and on its airwaves.
NBC “Nightly News” anchor Lester Holt did a segment that included clips of controversial comments Ms. Kelly had made earlier in her career while at Fox News.
Many NBC News producers and on-air personalities voiced their concerns. Al Roker, the jovial weatherman of NBC’s “Today,” was among the loudest voices saying her costume remarks were unacceptable, according to people familiar with the matter.
Ms. Kelly apologized, but the controversy didn’t die. NBC News Chairman Andy Lack sharply criticized her at an internal town hall meeting, a move that infuriated Ms. Kelly, people close to her and the network said.
The uproar over the blackface comments proved to be the tipping point in Ms. Kelly’s tumultuous relationship with NBC. The network said Friday it was canceling her 9 a.m. show. The two sides are negotiating terms of her exit from the network, according to people familiar with the matter.
As of Friday, Ms. Kelly remained an NBC News employee as negotiations with the network “about next steps” continue, said her lawyer, Bryan Freedman.
When NBC News wooed Ms. Kelly away from Fox in 2017 with an extravagant three-year deal, the network was betting she could provide a ratings boost to its already-powerful “Today” franchise and could anchor a Sunday-evening news magazine that would challenge CBS’s “60 Minutes.”
Instead, both shows were failures. The Sunday program flopped in the ratings and was quickly canceled. Viewership of the 9 a.m. hour on NBC fell about 14% on Ms. Kelly’s watch, to 2.4 million, compared with the year before she took over, according to Nielsen data.
Weighing NBC Down
Viewership of the 9 a.m. hour of 'Today' declined 14% on Megyn Kelly's watch compared with a year earlier, steeper than the decline for other segments of the show.
4.5
million viewers
4.0
3.5
2016-17 season
3.0
2.5
2.0
2017-18 season
1.5
9 a.m.
7 a.m.
10 a.m.
Source: Nielsen
Ms. Kelly knew the morning show wasn’t delivering the results she and NBC wanted. During the summer, she met with Mr. Lack and expressed concern about the program. He acknowledged that the performance was not good but indicated the network had not run out of patience yet, a person with knowledge of the matter said.
A few weeks ago they met again and she expressed interest in other, harder news assignments, a person familiar with her thinking said. NBC executives said Ms. Kelly wanted to know what “Plan B” was if the morning show went away, but Mr. Lack responded that he wanted to stay focused on the show.
People close to Ms. Kelly said that while the shows didn’t perform to her expectations, they believe she also was targeted for her aggressive coverage of NBC personalities who faced allegations of sexual misconduct and for criticizing NBC News leadership on her show.
After longtime “Today” host Matt Lauer was fired for allegations of inappropriate conduct with a colleague, Ms. Kelly had a former NBC News staffer on to talk about what that guest said was her consensual affair with Mr. Lauer, a move that irritated other “Today” staffers, according to NBC News insiders.
More recently, Ms. Kelly said on her show that NBC News should bring in outside investigators to determine why the network passed on a story journalist Ronan Farrow was preparing for it about allegations of sexual harassment and assault by movie mogul Harvey Weinstein. Mr. Farrow later took the story to the New Yorker, where it won a Pulitzer Prize. NBC News has said the story Mr. Farrow presented to the network wasn’t the same story and wasn’t ready to air.
NBC News insiders deny taking issue with Ms. Kelly’s #MeToo coverage, saying it was heavily promoted and they successfully lobbied Time Magazine to include her in its “Person of the Year” issue for her work.
Some of the tensions between NBC and Ms. Kelly existed from the start. Besides the resentment of her salary, some of her programming choices drew internal criticism, including her decision to interview conspiracy-theorist Alex Jones on her Sunday evening show.
The morning program seemed never able to strike quite the right balance between hard and soft news. Ms. Kelly struggled to adapt to interviewing celebrities. A public spat with Jane Fonda, whom Ms. Kelly asked on-air about plastic surgery, made booking other big-name talent a challenge.
Inside the halls of NBC News, Ms. Kelly didn’t make many friends. Some colleagues said it was painfully clear she wasn’t the right fit.
When “Today” talent including Mr. Lauer and Savannah Guthrie were eagerly talking about the August 2017 solar eclipse, Ms. Kelly said on air that it wasn’t that exciting and suggested her colleagues were “ginning it up.” Ms. Guthrie fired back, “We are very big on the eclipse here.” Ms. Kelly said viewers didn’t need to “waste an hour of your day,” leading Mr. Lauer to ask, “Who are you?”
When Ms. Kelly joined “Meet the Press” anchor Chuck Todd to cover President Trump’s State of the Union address this past January, she suggested no one was watching or would care what the president said, a comment that struck some staffers as a buzzkill on one of the biggest nights in politics.
“These events tend to be utterly forgettable, and this one probably will be, too,” Ms. Kelly said on-air prior to the president’s remarks.
Ms. Kelly’s challenge will be to re-establish her reputation as a top player in TV news. At Fox she thrived over a 12-year career as a tough interviewer. Though she joined the network’s conservative voices on issues such as criticizing political correctness—and the so-called “war on Christmas”—or the Black Lives Matter movement, she occasionally won plaudits from elsewhere on the political spectrum for hard questioning of politicians on the right.
She gained more prominence nationally when she challenged then-presidential candidate Donald Trump over his statements about women during a live debate in 2015.
Fox News parent 21st Century Fox and Wall Street Journal parent News Corp share common ownership.
The market for Ms. Kelly now appears tepid, according to news executives in the industry. Ms. Kelly’s camp feels that NBC’s actions this week are aimed at hurting potential future opportunities.
Some NBC News executives were doubtful from the start that the costly hiring of Ms. Kelly would pay off. She was not only transitioning from an opinion-based show but also moving to a different style of television in which she had no experience.
“We were a baseball team and we signed a free-agent running back,” said one senior NBC News executive.
In an interview earlier this year, Ms. Kelly said her morning show needed a year to find its footing, and noted, “The ratings are important and there’s no question that counts. But it’s not the only metric.”
She added, “We need time for the viewers to get to know me, for them to see me for who I am and not through some partisan lens.”
The network has said other “Today” personalities will fill in at the 9 a.m. hour starting next week.
The failed bet on Ms. Kelly is the latest setback for Mr. Lack, the news division chairman. People inside and outside the network said it raised questions about whether he was too focused on big names in front of the camera.
Mr. Lack led the charge to get Ms. Kelly, believing her star power would transcend the conservative lineup she had been part of and would have broad appeal to morning-show watchers, a very different kind of audience.
The stakes are high at “Today,” which generates more than $500 million in revenue and profits of $100 million annually for Comcast Corp.’s NBCUniversal.
There have been other flare-ups on Mr. Lack’s watch. There were questions about how the network handled damning footage it had of Billy Bush and Mr. Trump in 2005, in which Mr. Trump boasted of grabbing women by the genitals. The Washington Post ultimately broke that story of the footage, leaving many wondering why NBC appeared to sit on it.
NBC defended its handling of the tape at the time. A spokesman said, “NBC News did exactly what you would expect from a great news organization. As soon as we saw the tape and made the assessment it was undoubtedly newsworthy, we moved quickly and deliberately to get it published and to do so in the most responsible way.”
Mr. Lack retains the support of his boss, NBCUniversal Chief Executive Steve Burke, a person close to Mr. Burke said.
In Mr. Lack’s favor is the strong performance elsewhere at NBC News. The other three hours of “Today” are still strong. “Today,” “Nightly News” and the Sunday magazine program “Meet the Press” all finished first in the 25-54 age demographic advertisers target.
NBC’s cable network MSNBC is also performing well. A new daytime lineup is now beating CNN in viewers. And while the prime-time lineup there was in place prior to Mr. Lack’s arrival in 2015, its ratings have grown significantly since then as its programming has established itself as a liberal counterpart to Fox News’ conservative take.
Write to Joe Flint at joe.flint@wsj.com
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