CNN is about to enter an era of “noticeable change,” the head of the news outlet cautioned staffers in a new memo, hinting that layoffs and a reorganization could be in store as the unit’s corporate parent navigates a more uncertain economic climate.
“There is widespread concern over the global economic outlook, and we must factor that risk into our long-term planning,” said Chris Licht, the chairman and CEO of the Warner Bros. Discovery-owned outlet, in a memo. “All this together will mean noticeable change to this organization. That, by definition, is unsettling. These changes will not be easy because they will affect people, budgets, and projects.”
The executive did not specify how many positions might be eliminated or in what areas of the company. Under Licht, CNN has already pared some of its workforce devoted to audio, and eliminated the streaming hub CNN+ just weeks after its launch. He indicated the work of recalibrating CNN’s business operations would be completed before the start of 2023. CNN typically operates with a staff of between 4,000 and 4,500, according to a person familiar with the matter.
“We will be strategic in this process and will minimize the impact on our core newsgathering operation and Digital, both of which have already executed smart changes,” Licht said. “Let me be clear: I will not allow these changes to affect our position as the world’s leading news source, and we will continue to invest in growth areas. When we conclude this process, CNN will still be the largest, most-respected newsgathering organization in the world. We will continue to cover any story, anywhere, any time — with more resources than anyone else. Full stop.”
Licht has for several months been analyzing CNN’s business operations as part of a review. His tenure began in May, and he has been nudging the network toward keeping a more centrist philosophy, in the belief that CNN grew so passionate during its coverage of the Trump administration under previous chief Jeff Zucker that it is now viewed as having partisan leanings.
CNN’s search to cut costs comes as its corporate parent is grappling with some onerous business conditions. Warner Bros. Discovery CEO David Zaslav made a commitment to investors that the company would cut $3 billion in costs after acquiring the assets of the company formerly known as WarnerMedia from AT&T. On Monday, the company indicated in a filing with the U.S. Securities and Exchange Commission that it would have to spend between $1 billion and $1.5 billion to scrap programming already commissioned and pay out severance packages. Warner Bros. Discovery also said it expected to take write-downs of potentially more than $4 billion in pre-tax charges through 202. More than $2 billion of that would be related to charges for scaling back development and jettisoning older TV shows and movies.
The warning also surfaces as many media companies are preparing for a potential recession and possible pull-backs in ad spending. Such terrain has been tricky for some time, as big marketers move some portion of their dollars to new streaming hubs. Both Netflix and Disney, for example, are in the market to sell commercials on ad-supported versions of their namesake streaming services.
The cuts — and the internal tension likely to be associated with them — won’t alleviate stress at CNN. The network is in the midst of retooling large parts of its schedule, and is set to launch a new morning program on Tuesday. It has already launched a new interview show led by Chris Wallace on Sunday evenings and has debuted two new hours of programming — led by Jake Tapper at 9 p.m. and Laura Coates and Alisyn Camerota at 10. None of the new shows have proven to be a solid ratings hit as of yet.
Most of the nation’s news operations are betting that the 2022 midterm elections will help to boost their fortunes. Viewership tends to fall off after a presidential election and gain new traction as another one draws near. In the third quarter, CNN’s average primetime audience among people between 25 and 54 — the demographic most coveted by advertisers in news programming, was off 21%, to 150,000, according to Nielsen. In comparison, MSNBC’s was down 22%,t o an average of 127,000, while Fox News Channel’s was off 23%, to an average of 294,000.
