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CNN’s new streaming service CNN+ — which focuses on Brian Stelter, Jemele Hill, Don Lemon, Rex Chapman and Chris Wallace — is in jeopardy, just two weeks after it launched.
Fewer than 10,000 people are using CNN+ on a daily basis, people familiar with the matter tell CNBC. CNN+ has already cost CNN $300 million and, as a result, staffers are bracing for layoffs.
Under former boss Jeff Zucker, WarnerMedia viewed CNN+ as the key ingredient toward its future. Zucker planned to invest around $1 billion in the service over the next four years. With Zucker out and Chris Licht taking over on May 1, CNN will likely quash these plans.
Axios added on Tuesday that “investment and projections for CNN+ are expected to be cut dramatically in response to a low adoption rate.
“Hiring has been frozen at WarnerMedia for the past six weeks, and this has been felt at CNN,” the report adds. “One top executive notes that there is a sense of confusion internally as to why CNN didn’t push back the launch of CNN+ until after the Discovery merger.”
In addition to CNN+ struggles, the “talents” on the service undermine Licht’s plans to re-establish CNN’s reputation as a credible news agency. Insiders expect Licht to double down on reporters like Clarissa Ward and pivot away from woke opinionists like Lemon.
As a standalone service, CNN+ has virtually no promise. The most likely outcome is that Discovery folds CNN+ into HBO Max along with Discovery+ — the two other services Discovery will control after it merges with WarnerMedia. Both HBO Max and Discovery+ have millions of subscribers, CNBC adds.
If CNN scales back its focus on streaming, Chris Wallace’s future at the company may change considerably. Zucker hired Wallace to be the face of the service. And because CNN is paying Wallace TV money to host a daily streaming show, perhaps Licht will look to move Wallace to its linear lineup in the next year. New management plans to make changes to the TV lineup anyway.
Netflix reshaped the media industry. Every broadcast and tech company is now trying to compete with Netflix. This strategy makes sense for companies that have the library to monetize subscribers, but CNN doesn’t.
CNN is not Disney. Hardly anyone watches CNN on linear television for free. So why would they pay extra for CNN+?
You tell us.