- Warner Bros. Discovery has decided to shut down CNN+ just weeks after it launched.
- CNBC reported last week fewer than 10,000 people were watching CNN+ each day.
- CNN+ head Andrew Morse is leaving the company.
- Warner Bros. Discovery leaders spoke to hundreds of CNN+ staffers Thursday to explain the decision to shut down the service.
Warner Bros. Discovery is shutting down CNN+ on April 30, just weeks after the stand-alone streaming service launched.
"This is not a decision about quality; we appreciate all of the work, ambition and creativity that went into building CNN+, an organization with terrific talent and compelling programming," Chris Licht, chairman and CEO of CNN Worldwide, said in a statement Thursday. "But our customers and CNN will be best served with a simpler streaming choice."
related investing news
The company also announced CNN+ head Andrew Morse is leaving Warner Bros. Discovery after a transition period. Alex MacCallum, currently CNN+'s general manager and head of product, will lead CNN Digital after Morse departs.
WarnerMedia launched the stand-alone news service less than a month ago on March 29. It garnered fewer than 10,000 daily active viewers in the two weeks after its launch, CNBC reported last week. The company said customers will receive prorated refunds on subscription fees.
New CNN head Licht has been working behind the scenes with other executives at Warner Bros. Discovery for several weeks to analyze a streaming strategy for CNN, according to a person familiar with the matter. The decision to shut down CNN+ is based on his recommendation, said the person, who asked not to be identified because the discussions were private. Licht's official start date isn't until May 1.
Warner Bros. Discovery hasn't officially outlined its streaming plans and ambitions, but as CNBC has previously reported, the goal is to combine HBO Max and Discovery+ with other programming from WarnerMedia — including potentially live news and sports — and offer all of the content together as a Netflix-competitor.
If the goal is to maximize the number of subscribers for the big bundle, dedicating resources to CNN+, rather than folding that programming into the larger bundle, could be antithetical to the company's strategy.
Licht and Warner Bros. Discovery's head of global streaming JB Perrette, were among the executives who addressed CNN staffers during an all-hands meeting Thursday, according to people familiar with the meeting.
Licht spoke first, empathizing with staffers that shutting down CNN+ so quickly was "a uniquely s---ty situation," the people said.
Perrette told employees that once new leadership made the decision that CNN+ didn't fit strategically into the company's plans, the most logical move was to shut it down as soon as possible "and not a second longer," two of the people said.
He also cited previous Discovery launches of niche streaming networks, such as Food Network Kitchen and GolfTV, and said the company has arrived at the conclusion consumers don't want to pay more money for small services. While Warner Bros. Discovery will take streaming risks, it won't undertake efforts where it already knows the end result, he said, according to the people familiar with the meeting.
Perrette fielded several questions from staffers about who should be held accountable for the botched launch, they said. Perrette blamed the prior WarnerMedia leadership, who continued to push forward on the product even while knowing Discovery leadership was suspicious of the product's viability.
The mood among staffers was largely anger and disbelief, two of the people said. CNN+ has more than 600 employees working on shows, the people said. Many of those employees will receive a formal severance notice Friday and will have a chance to reapply for jobs within CNN, according to the people.
In an internal memo, Licht told CNN+ employees they will "continue to be paid and receive benefits for the next 90 days to explore opportunities at CNN, CNN Digital and elsewhere in the Warner Bros. Discovery family. At the end of that period, any departing CNN+ employee will receive a minimum of six-month severance (depending on length of service at CNN)."
CNN has already invested hundreds of millions of dollars on new talent and programming for CNN+. Some of that programming will move to HBO Max and other series may live on CNN.com and the free CNN app, according to one person familiar with the changes. Some new talent may assume roles on CNN's linear station, they said, but Licht will make those determinations in the coming weeks.
On March 29, outgoing WarnerMedia Chief Executive Officer Jason Kilar said in a series of tweets that CNN+ was "as important to the mission of CNN as the linear channel service has been these past 42 years. It would be hard to overstate how important this moment is for CNN."
One month later, nearly to the day, CNN+ will cease to exist.