After a year of chaos, CNN bets on new CEO Thompson to focus on long-term viability

A person walks past the CNN headquarters in Atlanta, Georgia, Nov. 17, 2022.

Brandon Bell | Getty Images

When former CNN Chief Executive Officer Chris Licht started running the news organization last year, he was given a mission by his boss, Warner Bros. Discovery CEO David Zaslav: change the network’s programming and tone to emphasize news rather than “advocacy” journalism.

With Licht now fired, CNN’s incoming CEO, Mark Thompson, has a new mission: everything else.

Thompson, who starts at CNN on Oct. 9, has had preliminary discussions with Zaslav and other members of CNN’s leadership about strategic ideas and priorities, according to people familiar with the matter, who declined to speak on the record because the discussions were private. He has made no decisions about CNN’s operations and won’t until he has had a chance to meet with staffers and learn the business, said the people.

Still, some areas of emphasis are clear. Thompson will focus on building digital subscription businesses around CNN.com and creating programming for a younger audience on CNN Max, the network’s live news service on Warner Bros. Discovery’s “Max” streaming service, said two of the people.

Licht’s background was programming, as he launched “Morning Joe” on MSNBC and “CBS This Morning” with Charlie Rose, Norah O’Donnell and Gayle King. Zaslav hired him as a TV programmer — and ultimately fired him after Licht lost the confidence of his employees and failed to deliver ratings winners.

Much of Licht’s short reign, which lasted a little over a year, centered around depoliticizing CNN. Zaslav and Licht agreed that CNN had gotten a reputation as left-leaning, and tried to refocus the network as a down-the-middle outlet that could appeal to both Democrats and Republicans. Licht and CNN’s leadership since his firing — a four-person team of Amy Entelis, Virginia Moseley, Eric Sherling and David Leavy — overhauled CNN’s linear shows, including debuting a new morning show and a revamped prime-time lineup.

Licht struggled to win over CNN employees by purposely taking a hands-off approach to differentiate his style from former CNN chief Jeff Zucker, who resigned in February 2022 after failing to disclose a consensual relationship with a coworker. Zaslav felt Licht moved too slowly to make decisions and didn’t appropriately relate to CNN’s talent, according to people familiar with the matter. Licht believed he couldn’t be his authentic self given Zaslav’s mandate to be a no-nonsense leader who had to reform CNN’s image and cut costs, the people said. Licht had to lay off hundreds of employees as part of a broader Warner Bros. Discovery head count reduction.

Mark Thompson, CEO of CNN

AP

While Licht largely focused on linear programming, Thompson will concentrate on making CNN a sustainable business for the next five years — a timeline he’s already discussed with some members of CNN leadership, according to people familiar with the matter. The work to change CNN’s reputation is largely complete, according to people familiar with Warner Bros. Discovery executives’ thinking.

How to cover Donald Trump, an issue that defined Licht’s tenure, probably isn’t in Thompson’s top five priorities as he starts the job, according to a person familiar with the matter. Existing CNN executives believe they already have the infrastructure in place to appropriately handle the former president and current Republican primary candidate as the 2024 election ramps up, the person said.

Entelis, Moseley, Sherling and Leavy all plan to stay at CNN as Thompson takes over as CEO, according to people familiar with the matter. All will report to Thompson.

A CNN spokesperson declined to comment on speculation about Thompson’s eventual moves and strategy.

Digital strategy

Thompson’s last job was CEO of The New York Times, a position he held from 2012 to 2020. He grew the Times’ subscription digital business, which launched in 2011, from less than 1 million subscribers to about 7 million before he left the company in September 2020. During his time as the newspaper’s CEO, shares rose from $9 to about $43 — a gain of more than 375%.

CNN hasn’t had a clear digital strategy since Zaslav and Licht decided to kill off CNN+ after just a month, in 2022. CNN+, at the time, was a little-watched streaming service that launched without much content. Former CNN chief Jeff Zucker and then-CNN digital chief Andrew Morse hoped it would eventually become CNN’s version of The New York Times — a subscription news product that could feature more than just video.

Thompson will still have to preside over CNN’s linear network, an entity that has declined along with the erosion of the pay-TV cable bundle. But Zaslav is counting on him to use CNN.com and its 149 million monthly unique visitors as a funnel to build digital subscription businesses, said people familiar with the matter.

One idea being discussed is to build several subscription products on specific topics within CNN.com, which would remain without a paywall, said the people. For customers who want all access, CNN could offer a bundle for a discount. Paying a monthly fee could unlock on-demand or live CNN programming on certain subjects, give users access to particular pieces of in-depth or focused journalism and provide other benefits.

Thompson may also explore ways to integrate Bleacher Report with CNN.com, just as The New York Times has done with The Athletic, the online sports media company it acquired last year for $550 million, according to a person familiar with the matter.

Programming CNN Max

Before joining The New York Times, Thompson was director-general — a combination of chief executive and editor-in-chief — of the British Broadcasting Corporation. He’ll have a chance to develop new shows at CNN Max, a tab in Warner Bros. Discovery’s larger Max streaming service.

With CNN Max, Thompson will try to program for a younger audience. CNN’s linear network largely appeals to older, 60-and-up adults who still subscribe to traditional pay TV.

Thompson will have some runway to invest in CNN Max. CNN’s EBITDA — or earnings before interest, taxes, depreciation, and amortization — is expected to be closer to $1 billion in 2023 after dipping to $750 million in 2022 when it had about $200 million in losses tied to CNN+, according to people familiar with the matter. Attention from the U.S. presidential election should also improve advertising revenue in 2024.

To keep CNN relevant, Thompson will need to figure out news programming that millennials and younger viewers will watch. Former CNN leadership feared news content would get swallowed up by a larger streaming service, believing it would be difficult to persuade viewers to eschew entertainment programming when both are on the same platform. That led Zucker and former WarnerMedia CEO Jason Kilar to push for CNN+, a standalone streaming service.

CNN has already begun considering ideas to solve that problem, including potentially alerting Max viewers who are watching on-demand entertainment to CNN breaking news.

“This is a game that is still very much to be played,” JB Perrette, president and CEO of Warner Bros. Discovery’s streaming operations, said of the streaming-news business last month in an interview with Variety. “Nobody has figured it out yet.”

That will be Thompson’s job.

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Source: https://www.cnbc.com/2023/09/19/new-cnn-ceo-mark-thompson-will-concentrate-on-cnns-5-year-viability.html

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