CNN seeks new CEO, enterprise technique after Licht departure

Warner Bros. Discovery CEO David Zaslav might have chosen from a litany of causes to fireside Chris Licht as CNN’s chief.

Licht, who left the community Wednesday after simply over a yr within the function, struggled with management fashion, lifting morale, programming choices, how one can cowl former President Donald Trump and, in the end, hubris.

However Licht’s total tenure at CNN might have turned out in another way had he persuaded Zaslav to maintain CNN+.

That will sound absurd. Hardly anybody watched CNN+ throughout its first two weeks of existence final yr. Zaslav and a number of other different Discovery executives, together with present Warner Bros. Discovery head of streaming JB Perrette and now-CNN Chief Working Officer David Leavy, had been skeptical of spending lots of of thousands and thousands of {dollars} on area of interest or half-baked content material concepts like “Jake Tapper’s Ebook Membership” and “Parental Steerage with Anderson Cooper.” Leavy is now a part of the manager crew that may assist Zaslav discover a new CEO.

Zaslav thought CNN+ was a waste of sources for a corporation saddled with $50 billion of debt that wanted to spice up free money movement and generate $3 billion in merger-related synergies. However earlier than he made any choices, he needed to listen to Licht’s ideas.

Licht was supposed to start his job Might 2, 2022, however he began just a few weeks early to weigh in on CNN+. In a number of digital conferences, he met with CNN+ head Andrew Morse, CNN+ common supervisor Alex MacCallum and CNN Chief Technical Officer Robyn Peterson, in response to folks aware of the matter. Perrette and Discovery streaming CFO Neal Chugani (who would turn into CNN’s CFO) had been additionally there.

Licht expressed his skepticism with the product’s programming, in response to folks within the assembly. The dialogue centered across the viability of providing a product named after CNN with out truly that includes a dwell feed of the community’s cable programming. Perrette advised the CNN+ management to pause all advertising spending and to not launch on Roku.

Whereas the CNN+ crew got here away from the conferences assuming the streaming service would doubtless be killed, they despatched financials to Discovery’s management. They budgeted to spend $440 million in 2022 and $550 million in 2023, the folks stated. The proposal referred to as for CNN+ to show a revenue by 2025 and break even on the cumulative funding by 2028.

Lower than three weeks later, CNN+ was lifeless. A Warner Bros. Discovery spokesperson declined to touch upon the small print of the conferences.

Had Licht persuaded the Discovery executives to maintain CNN+, it is doable his tenure at CNN would have developed in another way.

Licht’s background is present producing. He launched “Morning Joe” on MSNBC and “Late Night time with Stephen Colbert” on CBS. CNN+ would have given him a canvas to create exhibits from scratch. It additionally would have given him a development story to pitch to the press and buyers. If further spending wasn’t within the playing cards, he might have slashed the finances however saved the bones of the subscription product alive, iterating on inventive concepts till he landed on one thing that labored. CNN+ launched at $4.99 per 30 days, although pricing might have been adjusted.

Former CNN head Jeff Zucker, who left the community after disclosing a office relationship simply months earlier than the WarnerMedia-Discovery merger, had aspirations about turning CNN+ right into a New York Instances-like subscription product. That might have taken years, but it surely additionally may need given workers and administration a north star. Consideration on CNN+ might have been a ready-made distraction from falling linear TV rankings, which Licht might have dismissed as comparatively unimportant in contrast with constructing the corporate’s future.

With out CNN+, Licht was left with a foundering cable TV community and no coherent digital technique. That is anathema to a contemporary media firm.

In his yr on the job, Licht laid off lots of of workers and principally shifted round current CNN anchors and reporters to construct a brand new morning present and primetime programming. His experiment to maneuver primetime anchor Don Lemon to the morning failed. CNN fired Lemon in April. Licht tried to maneuver Tapper, a day anchor, to primetime, however the early rankings weren’t good, and Licht scrapped his plans.

In Licht’s protection, his lack of future technique echoed Zaslav’s restricted imaginative and prescient.

“When [Zaslav] referred to as and provided me the job, he advised me what he was in search of out of CNN,” Licht advised CNBC final yr. “And I stated, ‘That is precisely the type of community I want to see.’ There is no daylight between his imaginative and prescient for this community and my imaginative and prescient for this community. The one motive why I took this job is as a result of it was him in cost. I assumed, I can ship this for him.”

Zaslav advised Licht he needed to make CNN much less of an advocacy community and extra of a straight information community. Warner Bros. Discovery board member John Malone advised CNBC in 2021 he’d “wish to see CNN evolve again to the type of journalism that it began with, and truly have journalists, which might be distinctive and refreshing.”

However CNN journalists argued this was a straw man. They claimed they weren’t advocating for something apart from reality. A number of took offense to Malone’s feedback as a slight to their journalistic abilities.

CNN can change the tone of its programming round Trump, who’s the frontrunner for the 2024 Republican presidential nomination. It may possibly tone down hyperbole and rhetoric round his lies and exaggerations, relying on the state of affairs.

Nonetheless, that is not a enterprise technique. CNN+ could have been doomed to be nothing greater than a fledgling streaming service. Nevertheless it represented hope for the way a model might transition towards the longer term. A profitable chief of CNN might want to determine a approach to enhance rankings with compelling programming whereas additionally fostering new digital companies that usher in income and youthful audiences.

It is doable CNN+ would have by no means taken off, and Licht would spent the previous yr doubling down on a flawed idea that his Discovery bosses by no means preferred — which most likely would have led to his firing anyway. Buyers thumbed their nostril at elevated spending on streaming companies final yr, so any plan round CNN+ wanted to emphasise its long-term enchantment.

The issue was with out CNN+, Licht held a weak hand. CNN’s revenue fell in 2022 to about $750 million (together with $200 million in CNN+ losses) from $1.25 billion the earlier yr on a weak promoting market and declining cable subscription charges, in response to The New York Instances. Promoting income at CNN fell practically 40% beneath Licht, The Day by day Beast reported, citing MediaRadar information.

The 2024 election and a extra strong political advert market ought to assist CNN’s financials enhance subsequent yr, however “look ahead to 2024” is not a robust message — and it does not present an answer for 2025 and past.

If Zaslav desires to discover a CEO that may win the hearts and minds of workers and enhance the highest and backside traces, he’ll want to seek out somebody with a extra holistic technique than simply programming for a 55-and-older cable TV viewers.

In that means, Licht was doomed from the beginning.

WATCH: Chris Licht’s tumultuous tenure