More layoffs are likely to come.
Axios reported that Warner Bros. Discovery suspended CNN+’s all external marketing spending. It also fired longtime CNN Chief Financial Officer (CFO) Brad Ferrer.
WarnerMedia and Discovery recently came together to form Warner Bros. Discovery.
CNN+ executives wanted to have two million subscribers in the first year.
The moves by Warner Bros. Discovery have angered those inside CNN because they see CNN+ “as an eventual lifeline for the cable network.”
CNN wanted the streaming service “to become profitable in four years by investing $1 billion into” it. It went live on Roku last week, but now they’re concerned that suspending any marketing will dent any growth.
Those executives believe that if Discovery executives don’t do anything, then CNN+ would soon land on the same level as The Wall Street Journal, with 2,9 million digital subscribers.
Even if CNN+ gained millions of subscribers, how long would people stick around? Axios noted that people do not get the same items on CNN+ that they do on CNN. The shows performing the best on the streaming service “are the ones that mimic live TV programs.”
The Discovery executives are supposedly furious CNN launched CNN+ before the merger. It placed Discovery’s current CFO for streaming and international, Neil Chugani, as CNN’s CFO.
Discovery has success when it comes to streaming services. (I was just watching Discovery+. Love the shows with Josh Gates!)
The previous Axios report mentioned a merger with HBO Max. It looks like that is still the plan with CNN+:
- Warner Bros. Discovery executives see an opportunity to possibly include some CNN+ content on CNN’s app and make that video available for free and supported by ads, according to one source. Other CNN+ programming could live within HBO Max.
- It sees potential in leveraging the already massive reach of CNN.com and CNN’s main app to drive its digital growth long-term, as opposed to another subscription outside of linear TV.
But Discovery wants to emphasize journalism at CNN, which is a focus the network lost a long time ago.
The new bosses want more news programming and fewer opinion shows. CNN might have a live newscast in the 9 PM ET slot, which used to belong to Chris Cuomo.
CNN fired Cuomo in February over allegations of sexual harassment at ABC News in 2011. He called it hypocrisy because of relationships at the top tier of CNN leadership.
Cuomo sued CNN for $125 million. His ouster caused former CNN CEO Jeff Zucker and former chief marketing officer Allison Gollust to resign because they never disclosed their affair.
The Cuomo/Zucker fiasco is only partly to blame for this fiasco. Zucker resigned in February, and new CEO Chris Licht doesn’t start until May 1.
WarnerMedia and its former parent AT&T did not talk to Discovery about CNN+ strategy during the merger because of potential “regulatory scrutiny.”
The Discovery executives also feel like they made it known that they wanted CNN to launch CNN+ until after the merger.
The CNN executives claim they “didn’t feel corporate pressure from WarnerMedia to pause the rollout.”
No matter what, CNN+ is not going away. But it will not be what CNN thought it would be during the brainstorming stages.DONATE
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