In the end, CNN + lasted less than a month.
In a remarkable turnabout for one of the world’s premier television news outlets, Warner Bros. Discovery has decided to shut down CNN +, the ballyhooed streaming service that had been presented as CNN’s bid for a bold digital future.
CNN + will cease operations on April 30, the company said on Thursday.
“While today’s decision is incredibly difficult, it is the right one for the long-term success of CNN,” Chris Licht, the incoming president of CNN, wrote in a memo. “It allows us to refocus resources on the core products that drive our singular focus: further enhancing CNN’s journalism and its reputation as a global news leader.”
The shutdown is a stunning and ignominious end to an operation into which CNN had sunk tens of millions of dollars, from an aggressive nationwide marketing campaign to hiring hundreds of new employees to recruiting big, high-priced media stars, including the former Fox News Sunday ”anchor Chris Wallace and former NPR co-host Audie Cornish.
Andrew Morse, CNN’s chief digital officer and a key architect of its streaming strategy, will also step down.
Key players at CNN + were told of the decision only hours before Mr. Licht announced the news at a noon town hall, and many rank-and-file employees learned of the platform’s end via news reports on social media.
But the seeds behind its demise were planted weeks ago.
CNN developed the platform under the auspices of its former corporate parent, WarnerMedia – owner of the prestige TV powerhouse HBO and the storied Warner Bros. film studio – before its merger with Discovery, home to reality TV hits like “90 Day Fiancé” and the home-improvement gurus Chip and Joanna Gaines.
The Discovery leadership team, including its chief executive, David Zaslav, were long skeptical of the huge investment in CNN + and the network’s broader strategy with the service. CNN + made its debut just days before the merger was completed last month, to the frustration of some Discovery executives.
For the newly hired team at CNN +, it did not help that the biggest champion of the service, former CNN president Jeff Zucker, had been forced to resign under pressure in February after admitting to an undisclosed romantic relationship with a close colleague.
Mr. Licht and JB Perrette, the head of global streaming at Warner Bros. Discovery, convened several meetings over the past several weeks to figure out what to do with the service.
In his meeting on Thursday afternoon with CNN staff, Mr. Licht compared CNN’s efforts to launch CNN + to a builder constructing a house without being allowed to speak to the intended owner, according to a recording reviewed by The New York Times.
“Then the new owner came in and said, ‘What a beautiful house! But I need an apartment, ‘”Mr. Licht said, according to the recording. “And that doesn’t take anything away from this beautiful house you built. I am proud of it, and I am proud of this team, and I am gutted by what this means for you. ”
At the same meeting, Mr. Perrette invoked tweets that called the service “CNN Minus” because the digital outfit did not include content from the CNN cable network “that is the global calling card of this new organization,” he said. (To avoid running afoul of CNN’s agreements with cable carriers, CNN + did include the live programming that was featured on its cable network.)
Mr. Perrette also referred to Discovery’s “painful” history launching similar smaller streaming services – focused on cars, food and golf – and said that they were costly to market and had limited audiences.
“We have failed almost every turn to launch these products,” he said, according to the recording of the meeting.
Executives at Discovery thought that CNN + was off to a slow start: At any given time, there were fewer than 10,000 people using the service, according to a person familiar with the numbers who was not authorized to speak publicly. Still, two people inside CNN said the service had about 150,000 paying subscribers and was on pace to hit the network’s first-year goals.
CNN had planned to spend more than $ 1 billion on CNN + over four years, according to two people familiar with the matter, budgeting for 500 additional employees, including producers, engineers and programmers, and renting out an additional floor of its offices in Midtown Manhattan to accommodate them.
Warner Bros. Discovery has about $ 55 billion in debt, which executives are now under pressure to repay. The company also said it would find $ 3 billion in savings, which will result in belt-tightening at some divisions.
In February, as CNN was preparing to start the streaming service, the network was torn by the departure of Mr. Zucker, its long-serving president and the most prominent proponent of the service at the network.
Still, the network forged ahead. In February, addressing a group of anchors and executives stunned by Mr. Zucker’s departure, Mr. Kilar said the streaming service was integral to the future of CNN. And in March, as the merger with Discovery loomed, CNN held a launch party for the new service at Peak, a sleek restaurant and bar at 30 Hudson Yards not far from the network’s New York offices. At the party, CNN announced that Ted Turner, the voluble founder of CNN, was the service’s first subscriber.