CNN+, the just-launched subscription network, could already be headed for disaster: Report



CNN's new subscription platform, CNN+, could already be headed for disaster.

The video streaming platform, which officially launched on Tuesday, snagged high-level talent from rival networks, most notably Chris Wallace from Fox News and Kasie Hunt from MSNBC. Actress Eva Longoria also joined the platform and will host a travel show focusing on Mexican cuisine. Many of CNN's existing talent will also host shows on CNN+.

But what is happening now?

Fox Business senior correspondent Charles Gasparino reported Wednesday that CNN+ employees could already be headed for the chopping block.

According to Gasparino, hype surrounding CNN+ failed to drive subscriptions, which suggests the expensive new start-up is already bleeding cash.

"@CNNplus employees bracing for layoffs possibly as soon as May amid projections of lackluster sales of new streaming channel," Gasparino reported. "CNN employees say new streaming channel could be merged into larger @discoveryplus as early as May unless subscriptions pick up."

Breaking: @CNNplus employees bracing for layoffs possibly as soon as May amid projections of lackluster sales of new streaming channel; CNN employees say new streaming channel could be merged into larger @discoveryplus as early as May unless subscriptions pick up 130 @FoxBusiness
— Charles Gasparino (@Charles Gasparino) 1648660513

Lackluster subscriptions would, in fact, prove immediately dangerous for CNN because of the massive investment in the new platform.

According to the Washington Post, CNN invested nearly $100 million into CNN+, which included hiring "several hundred employees to build and launch the streaming service."

Not only would poor subscription figures suggest CNN+ is already in catastrophic territory if the report is true, but the second part of Gasparino's report — that CNN+ could be folded into Discovery+ — also has legs.

Earlier this month, Discovery Inc. shareholders agreed to merge with WarnerMedia, the current parent company of CNN, in a $43 billion deal, Reuters reported. As part of the consolidation, HBO Max, a video streaming service under WarnerMedia's umbrella, will be merged with Discovery+.

Thus, if CNN+ does not have enough support to sustain its own platform, it may also find itself under Discovery's flagship streaming platform.

How did CNN respond?

A spokesperson for the network did not directly refute Gasparino's report.

"For the record, we are VERY happy with the launch of CNN+ and are only bracing for a long run of success," said Matt Dornic, CNN's head of strategic communications.

Report: AT&T looking to dump CNN, network may have hit ratings peak 'hating' President Trump



AT&T, the parent company of CNN, is reportedly looking to dump the mainstream media outlet from its business portfolio over predictions that the network's ratings will tank if Donald Trump is no longer president.

AT&T acquired CNN in 2018 when the telecommunications giant bought Time Warner, later rebranding the media holding company as WarnerMedia.

What are the details?

According to Fox Business senior correspondent Charlie Gasparino, AT&T is looking for potential buyers because selling CNN would help AT&T begin paying down its debt, which currently stands at more than $150 billion.

"The balance sheet over there is a real problem and that's what's fueling this. I mean look at it this way: CNN does not have Donald Trump to kick around anymore — their ratings will take a hit," Gasparino told Fox News host Tucker Carlson last Friday.

"They are owned by a company that is financially unstable — $150 billion in debt, AT&T has," he continued. "They need to cut costs."

"On the content part of AT&T, the other part is the wireless part and the distribution through satellite, that content part is not analogous to the other content that they have there — it sticks out like a sore thumb," Gasparino added of CNN.

Of course, AT&T's interest in dumping CNN indicates company executives do not see holding CNN as financially beneficial for their company over the long term.

Gasparino went on to explain that even CNN's journalists believe the media company will be sold. "I am not a CNN hater — there are some really good journalists there — they believe they are for sale," Gasparino said.

Who are potential buyers?

Gasparino reported last month that Amazon CEO Jeff Bezos, the richest man in the world, could buy CNN, adding the news network to a media portfolio that already includes the Washington Post.

From Fox Business:

A person close to Bezos says as of now there is no real interest. "There has been zero talk on this," according to the source. FOX Business has not been able to confirm whether Bezos has had even informal talks on the deal or whether the speculation is simply a product of investment banker chatter which is often a catalyst for deal making even before talks commence.

Gasparino said on Fox News that Bezos buying CNN would make sense because other media organizations would likely be blocked by antitrust laws, and Bezos has the wealth for such a large transaction.

Meanwhile, the Wall Street Journal also reported that there are interested buyers for CNN, despite the news outlet not being officially for sale — yet.

AT&T has been approached by possible buyers for CNN, but it's not for sale (right now).Lots of people in media-bi… https://t.co/q65kM8sF9k
— Ben Mullin (@Ben Mullin)1603488837.0

"This rumor is real," Gasparino said on Fox News. "CNN, like a lot of media companies, it may have hit its peak hating Trump."