It's Back to Business as Usual For Keith Olbermann

So much for the truce between MSNBC and Fox. Since news of a cease fire (or at least a ratcheting down of the rhetoric) appeared in the pages of the New York Times twelve days ago, whatever fragile peace the two networks negotiated has dissolved into the usual volley of insults. Bill O'Reilly is once again the worst person in the world, according to Keith Olbermann. And MSNBC's parent company, GE, is once again responsible for supporting terrorist regimes that are hell-bent on America's destruction, according to O'Reilly. Few at MSNBC and Fox News are happy the deal has unraveled—and both sides have said they're hoping to salvage it, an unlikely prospect at this point—although some of the most annoyed people around are the NBC staffers who are getting increasingly fed up with Olbermann's antics.

As you may recall,GE chief executive Jeff Immelt and Fox News CEO Roger Ailes convened for a "secret" meeting back in May at which both men agreed that the feud between MSNBC and Fox News had grown too nasty and it was in the interest of both sides to tamper down the hostility. Word was passed down the food chain at both networks, although what was communicated to the public by Olbermann was hardly the straight scoop. On June 1, Olbermann announced that he no longer planned to pick on O'Reilly because of the right-wing cable host's attacks on George Tiller, the abortion doctor who had been murdered a month earlier. "So as of this show's end, I will retire the name, the photograph, and the caricature [of O'Reilly]," Olbermann intoned.

It was a convenient excuse to explain why he planned to shift his focus elsewhere. But it wasn't true, which became clear when news of the pact became public two months later, a Times article that even offered up confirmation from GE that both sides had come to an agreement. "We all recognize that a certain level of civility needed to be introduced into the public discussion," a GE spokesman told Times reporter Brian Stelter.

Once again, Olbermann didn't come clean, denying the existence of an agreement, or the notion that he'd been "muzzled" by his bosses, a defense that was followed by an attack on Stelter as well as Bill O'Reilly and Rupert Murdoch. Naturally, that prompted O'Reilly to retaliate, which he did two nights later. And now it's back to the way it was. Over the past ten days, Olbermann and O'Reilly have both returned to game they've been playing for a couple of years now, and the "cooling down" that Ailes and Immelt had been hoping for has gone up in smoke.

Fox News blames Olbermann for breaking the agreement, which is no surprise, of course. But insiders at MSNBC and NBC News aren't too happy with Olbermann either, we hear. His attempt to cover up the backroom deal and then lie about its existence—in the face of evidence to the contrary—was viewed as a typically ego-centric move on Olbermann's part, one that served his own personal interests at the expense of MSNBC's credibility. Making matters worse was how he handed the revelation that Countdown contributor Richard Wolffe was employed by a Washington lobbying firm, a story first reported by Salon's Glenn Greenwald. Instead of acknowledging the mistake, cutting Wolffe loose, and moving on—or saying nothing about the matter publicly—Olbermann first pretended as if he'd been unaware of Wolffe's new job when issued his regrets. But then he changed course, suggesting he'd been so consumed with grief following his mother's death in April that he didn't have time to look into the issue, so he handed over the matter to his "management team" so they could take care of it.

That Olbermann was quick to put the blame on his colleagues didn't sit very well with MSNBC insiders, we hear. The handful of lies and overall feeling that Olbermann had reignited a war that could have been brought to a close didn't do much to endear him to his colleagues either. Especially since Olbermann's numbers have been headed downward for months now, and there was a general feeling that a little change wouldn't be such a bad thing. Although MSNBC management had expected to see ratings come down from their 2008 election highs, the drop-off has been more pronounced than execs at the network anticipated. Changing up the Countdown formula could have been to MSNBC's advantage.

One other point that sticks in the craw of some MSNBC staffers is that Olbermann's ratings began to fall off right around Olbermann renegotiated his contract with the network, a deal that immediately made him one of NBC's highest-paid news personalities. In November 2008, NBC Universal agreed to rip up his old contract, worth an estimated $4 million a year, and offered him a new one that nearly doubled his annual salary to $7.5 million a year through 2013. The timing certainly worked out well for Olbermann. Less so for NBC Universal and MSNBC, which has watched as the show's ratings dip and has seen Olbermann turn into more of a greater liability than they imagined.

Unfortunately for NBC execs, there's little they do to fix the situation. MSNBC depends heavily on Olbermann, a fact made clear when he was told to tone down his rhetoric: According to the Washington Post's Howard Kurtz, Olbermann indicated he'd be prepared to walk out the door if NBC president Jeff Zucker forced him to make substantial changes to his show as part of any secret deal with Fox News. (Not that Olbermann hasn't threatened to quit on several occasions in the past. He has.) It's hard to imagine where Olbermann could go if he decided to leave. And yet at the same time, NBC would be hard-pressed to fire him—even if he continues to play the rogue and ignore the directives of senior management.

It's Back to Business as Usual For Keith Olbermann

That MSNBC remains beholden to Olbermann has never escaped the Countdown host himself, leaving him with a measure of power at NBC that he's never been shy about exercising. Case in point: Last week, Page Six reported that Katy Tur, Olbermann's girlfriend, recently started reporting for WNBC—a second gig in addition to her work at the NBC-owned Weather Channel—and wondered if Olbermann had anything to do with "boosting the news cutie's ascension." Indeed he did, a source tells us. We hear the new side gig followed Olbermann's complaints to NBC execs about Tur's role at the Weather Channel and the fact that Tur had been assigned to the channel's Vortex2 team, which goes out and chases tornados across the country. Olbermann, we understand, informed his bosses that the job was putting Tur "in danger" and he was deeply concerned about her safety, making it clear that he expected her to be reassigned. That will happen eventually. In the meantime, it's worth noting that her stint chasing storms hasn't been all bad. It did earn her a recent trip to Mount Rushmore, as you can see above.