Cable network’s death spiral continues amid leadership shuffle.
Warner Bros. Discovery, which owns CNN, is shutting down marketing for the network’s new streaming service, CNN+, after a lukewarm public reception, five inside sources told Axios on Tuesday. CNN’s long-time CFO has also been let go, signaling the network’s financial issues go beyond the apparent failure of its subscription streaming service.
CFO Brad Ferrer has been laid off and replaced with Neil Chugani, the former CFO for streaming and international at Discovery. The move is part of a “broader finance team restructuring,” the sources said, adding that the occupants of other high-level posts at WarnerMedia are likely to get the ax as Discovery, which merged with WarnerMedia earlier this month, places its own people in charge.
CNN executives themselves apparently believe the launch was successful, the sources say, but Discovery disagrees. The platform reportedly has just 150,000 subscribers, with a mere 10,000 tuning in on a daily basis – embarrassingly low numbers given the $300 million already spent on the project. CNN+ was expected to attract 2 million subscribers in its first year.
While the cable network initially planned to invest $1 billion into its streaming project over the first four years – at which time it was projected to break even – those numbers have been severely cut back, sources told Axios. The executives’ projection of CNN+ reaching 15 to 18 million subscribers over the next four years now seems far outside the realm of possibility.
With ratings on a steep downhill slide, netting just 857,000 average prime-time viewers for the first quarter of 2022, CNN’s new management reportedly wants to give the channel a makeover, bringing it back to its hard-news roots and away from the opinion-dominated platform it has become. Executives are even said to be willing to forgo some short-term profit to reorient the channel toward breaking hard news stories, a wide-open space on the cable TV landscape with so many other US news networks striving to transform themselves into variations of CNN.
But it appears increasingly doubtful that CNN+ will have a place in that vision. It had no sooner broadcast its first show last month than reports of layoffs scheduled for May began circulating. The platform’s questionable business decisions – it marketed the first 29 seconds of its inaugural broadcast, an episode of ‘5 Things with Kate Bolduan’, as a set of NFTs, and its weekly schedule was packed full of the same names that viewers can get for free on its TV channel – suggest management will have an uphill battle turning CNN into a serious news station again.
While incoming CEO Chris Licht has promised to swear off Twitter on his first day of the job to help him focus on reality, he comes to the position from CBS, where he was executive producer of the Late Show with Stephen Colbert, and he also helped create the Morning Joe program with Joe Scarborough. Licht replaces Jeff Zucker, who left the network earlier this year amid an outbreak of pedophilia and sex scandals that also claimed the jobs of anchor Chris Cuomo and one of his producers.