CNN+, the streaming service that was expected to be one of the most significant developments in the history of CNN, will shut down on April 30, just one month after it was launched.
Warner Bros Discovery Inc confirmed that it is shutting down the CNN+ streaming service, underscoring the determination of a new corporate parent to refine its strategy, Bloomberg reported.
Although CNN+ surpassed 100,000 subscribers in its first week, it had hurdles to surmount, including new leaders who have vowed to aggressively cut costs and focus on a single streaming service.
CNN came under new management earlier this month, with the merger of its parent WarnerMedia and Discovery Inc., creating Warner Bros Discovery. The team led by chief executive officer David Zaslav has promised to find $3 billion in savings from the combination.
As a result, CNN+, which spent about $500 million on its app, including marketing and talent, became an early target, Bloomberg reported.
This has also raised fresh questions about the growth of subscription-based online video as the decision to shut down CNN+ comes in the same week that Netflix Inc reported its first major subscriber drop in 10 years.
Netflix Inc saw its shares plunge 35 percent, erasing $54 billion of market value in its biggest drop since 2004, after the firm reported a shocking loss of 200,000 subscribers in the first quarter of 2022, the first time it has shed subscribers since 2011.
HBO Flagship
Zaslav has talked about making HBO Max the flagship of the new company’s effort to compete with Netflix.
As a standalone app, CNN+ didn’t fit into that vision. Another service, Discovery+, is expected to be folded into HBO Max at a later date, Bloomberg reported. The company is also considering whether to rebrand HBO Max.
CNN+ offered a mix of lifestyle shows and traditional news, including a daily interview programme from Chris Wallace and a food and travel series hosted by actress Eva Longoria. Its programmes will move to CNN’s cable channel and website while longer-form productions will go on HBO Max.
None of the high-profile hosts who were hired for CNN+ are expected to leave the company. Wallace will likely take his show to the CNN cable channel, but the network’s leadership is still trying to decide what is the best platform for each CNN+ program.
Shares Fall
Shares of Warner Bros Discovery fell 6.8% percent to $21.45 in New York, in part over continuing skepticism about the future of online TV following Netflix’s surprise subscriber decline.
Zaslav and his team are taking over Warner Bros. Discovery almost a year after AT&T Inc. agreed to merge its media operations, including CNN, with Discovery.
For much of the past year, while the deal was under regulatory review, Discovery executives were sidelined from making decisions affecting the former WarnerMedia or influencing CNN’s decision to press ahead with its streaming strategy.
The service suffered a big blow just weeks before its launch when Jeff Zucker, who had supported the creation of app, left the company and was replaced by Chris Licht, a longtime television executive.
CNN+ charged $5.99 a month. Executives described it as CNN’s most ambitious new venture since the founding of the network more than 40 years ago.
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