CNN+ To Shut Down Less Than A Month After Launching

Stanbic-IBTC-Pension-Managers

CNN’s new streaming service, CNN+, is shutting down only a month after launching, closing the book on a high-profile project that executives with the network once touted as its future.

In a memo on Thursday, incoming CNN chief executive Chris Licht said the media company would pull the plug on the service at the end of April. The head of CNN+, Andrew Morse, is leaving the company. Executives said that some CNN+ programming and employees would be absorbed into other networks at the company, but with a staff of 500 there will likely be layoffs.

“In a complex streaming market, consumers want simplicity and an all-in service, which provides a better experience and more value than stand-alone offerings,” Licht said in a statement to Variety.

In a Thursday town hall, executives also said the service’s inability to show live breaking news was a crucial failing. Because of contracts with cable and satellite companies, CNN+ could not stream the CNN television network.

“It’s a little bit like The New York Times subscription without The New York Times,” said J.B. Perrette, head of Discovery’s streaming services.

According to Perette, Discovery learned that CNN+ could not expect to come close to 1 million subscribers. He based this assessment on the company’s attempt to launch its own news service in Poland and by studying the trajectories of other paid streaming services in the U.S., like Fox Nation.

“Those are the facts,” Perrette said. “We’ve learned from painful history, financially costly history.”

“Our goal is to compete”

CNN+ began when its parent was still part of AT&T. It combined with Discovery earlier this month to form a new company, Warner Bros. Discovery, under CEO David Zaslav. The company’s other streaming-video ventures include Discovery+ and HBO Max.

On the company’s latest earnings call in February, Zaslav told investors the merged entity would be frugal with its spending.

“Together, we already spent aggressively across all demos and genres,” he said. “And now that we have the resources, we plan on being careful and judicious. Our goal is to compete with the leading streaming services, not to win the spending war.”

AT&T spent at least $100 million to develop CNN+ and assigned some 500 employees to building the service. The network hired a lineup of media stars including Fox News’ Chris Wallace, former NPR host Audie Cornish, ex-NBC News host Kasie Hunt and food media star Alison Roman.

Perrette told the employees they would have “first dibs” on some 100 jobs currently open at CNN. Licht’s memo said departing staffers would receive at least six months of severance pay.

The outlook for streaming video has cooled substantially since two years ago, when pandemic lockdowns led millions of Americans to considerably up their screen time and drove a surge in streaming subscriptions. Earlier this week, Netflix reported its first loss of subscribers in 10 years, with analysts attributing the stumble in part to growing competition from traditional media outlets launching their own streaming services.

CBS News

Stanbic-IBTC-Pension-Managers

LEAVE A REPLY

Please enter your comment!
Please enter your name here