Here’s a breaking news alert unlikely to receive 24/7 coverage on CNN: CNN+, the cable news giant’s supplementary streaming service, is facing dramatic cuts in funding and investment, according to an Axios report.
You may be asking: Didn’t CNN+ just launch, like, last week? Or, perhaps you’re even asking: CNN has a supplementary streaming service? These are the incisive, hard-hitting consumer questions that have left higher-ups at parent company WarnerMedia second-guessing their new venture.
Unreliable (Revenue) Sources
Let’s not bury the lede: CNN+ has seen, at best, a mediocre launch. Stocked with a backlog of CNN documentaries and headlined by original programming such as Jake Tapper’s Book Club (not a joke) and a new interview show hosted by former Fox News anchor Chris Wallace, the streaming service launched March 29 and was seen as a major stepping stone away from traditional cable for the Cable News Network.
WarnerMedia has spent roughly $100 million to market the platform, a company insider told TechCrunch last week, more than the average yearly marketing budget for CNN proper. But, so far, it appears the juice has not been worth the squeeze:
- The overall launch budget neared $300 million, according to Axios. Internal projections expected 2 million subscribers (at $5.99 per month) within a year, and planned investment of up to $1 billion to reach 15 to 18 million subscribers, and profitability, after four years, Axios reports.
- Expectations are now being dramatically cut after a low early adoption rate, according to Axios. Consequently, overall investment in CNN+ is likely to be slashed by hundreds of millions of dollars.
Undiscovered: Looming over everything is mass turnover at the highest levels across the company. Longtime CNN chief Jeff Zucker resigned in early February, after an internal company investigation uncovered an undisclosed workplace relationship. Replacement Chris Licht isn’t taking the helm until May 1. Meanwhile, WarnerMedia is undergoing a massive merger with Discovery, leading Warner CEO Jason Kilar to resign last week and spurring a hiring freeze across the entire company for the past month.