CNN is going through a galactic crisis. The network has experienced a significant drop in its viewership numbers since Trump left office. The news network lost 70% of prime time viewers in February 2022, and made an all-in bet to come back to life by getting into the streaming industry. The channel partnered with Warner Bros. Discovery and launched CNN+ on March 29, with a reported investment of around $300 million. Yet, a mere month later, it appears the gamble has failed miserably, and that CNN+ days are numbered.
According to a report by Axios, Warner Bros. has suspended all external marketing expenditure for CNN+ and decided to remove the network’s Chief Financial Officer (CFO) with Discovery’s CFO after a disappointing first month of the streaming platform. Although it is still unknown what will the ultimate fate of CNN+ be, the decision to pull out advertising expenditure to promote the channel indicates that its financial backers have lost fate in their product, putting in question the survival of the news streaming service.
The CNN+ failure represents an early challenge for Warner Bros. Discovery, which finalized their merger a couple of weeks ago, and it has been reported that the media conglomerate aims to slash spending in their company, and CNN+ is on the chopping block.
The CNN+ failure is the latest crisis for the embattled cable news channel
Initially, CNN+ was expected to attract 2 million subscribers during its first year, and executives expected to reach between 15-18 million users after the first four years. However, the numbers during the first month of the news streaming service have been disappointing for Warner Bros. Discovery. CNN+ has only managed to get 150,000 subscribers so far, which means the channel spent $2,000 per subscriber after the initial $300 million investment in the streaming service.
According to Axios, CNN executives disagree with the stark assessment made by Warner Bros. and consider the launch has been a success, pointing out that their original plan was to break even after four years and that the technological rollout of the app was largely a success. The CNN executives blame Warner Bros. Discovery for the failure of the platform, saying that the expenditure on advertising should have not been rolled back so early and that CNN+ would surely surpass other news outlets.
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This is not the first debacle that CNN has faced over the last few months. Earlier last year, the primetime host Chris Cuomo was fired from the company after it was reported that he actively tried to help his brother Andrew Cuomo during the sexual harassment scandal that ended his tenure as governor. Cuomo then sued the company for $125 million alleging CNN had breached its agreement and that the network was using him as a scapegoat.
CNN’s woes did not end with Cuomo’s firing, as its former chief executive Jeff Zucker resigned in February over a consensual relationship he had with an employee in the channel during his time as leader of the channel.
The combination of a precipitous fall in viewership in the post-Trump era and very public internal struggles with their staff are not the only issues that CNN has had to handle. Its new leadership is trying to restore a more news-based, less partisan image for the channel, as confirmed by the Chief executive, David Zaslav, of Warner Bros. Discovery, who told employees that he did not want the channel to be an “advocacy network.”
At a time when CNN faces both commercial and organizational challenges, the initial failure of its streaming service is another set of terrible news for an organization that has little room for error.