When Mark Thompson was employed as CEO of The New York Occasions in 2012, he knew that he was going through skepticism from throughout the storied information group, cautious of the TV govt coming in with a mandate to remodel its enterprise.
“An outsider has many disadvantages, however one benefit is a ‘chilly eye,’ ” Thompson recalled in a case examine for the worldwide consulting agency McKinsey & Co. in August 2020, shortly after his departure from the Occasions was introduced. “On this case, I took the job as a result of, in addition to all the issues and the issue of change in a legacy media group, I assumed there was additionally immense potential.”
Now, Thompson will convey that “chilly eye” to CNN, the place he was named chairman and CEO on Aug. 30. As with the Occasions, Thompson will discover a storied information model grappling with a declining legacy enterprise, and with out an apparent off-ramp to a digital future. “I feel Mark is the uncommon particular person who has journalistic chops, in addition to enterprise chops,” says Jonathan Miller, CEO of Built-in Media, which focuses on digital media investments. “There should not many who’re revered and efficient at each the artistic and enterprise sides of the Hollywood ecosystem. I’d point out Barry Diller, Bob Iger, Peter Chernin in that regard. And I feel Mark is the equal within the information enterprise. I feel he’s of that caliber.”
“What’s so essential about that’s CNN at the moment has each journalistic questions and points in addition to enterprise points to take care of,” provides Miller, who was working as the top of Information Corp.’s digital companies when Thompson was operating the BBC.
Maybe no problem will probably be larger than navigating the escape from the standard pay-TV bundle, a system that drove CNN and its opponents to turn into revenue facilities for his or her respective corporations, however which is now inexorably in decline.
The soiled little secret about cable information is that Fox Information, MSNBC, CNN and all the opposite gamers profit enormously from one another’s existence. The competitors is intense, in each scores and mindshare, however the enterprise that has powered these channels is the pay-TV carriage payment. Fox Information advantages as a result of avid MSNBC or CNN viewers, who both don’t care about Fox or actively detest it, are nonetheless paying north of $2 monthly to the channel. MSNBC and CNN profit as a result of Fox’s giant viewers subsidizes their channels.
It’s an ideal enterprise, and one utterly at odds with the direct-to-consumer mannequin, the place fandom and relationships are key. It’s for that motive (in addition to some company synergy considerations) that CNN, a yr after the shuttered CNN+ effort, will revive its streaming plans by way of Max, Warner Bros. Discovery’s streaming platform. And it’s why NBCUniversal has sought to combine MSNBC into Peacock, its personal company streaming platform. Whether or not Thompson adjusts that technique or pursues a brand new one stays to be seen, although WBD executives stay adamant that information will play a vital position in Max’s future.
Fox Information, in the meantime, has pursued a unique method, leaning into its personal direct-to-consumer “tremendous fan” providing Fox Nation. The corporate has not damaged out what number of subs the service has (it has additionally leaned extra into leisure content material, like Cops, a Yellowstone nationwide park docuseries hosted by Kevin Costner and a Roseanne Barr comedy particular), however it’s a completely different mannequin than CNN or MSNBC’s technique.
CNN has leaned laborious into Max, with its upcoming service to incorporate stay streams of key reveals like The Lead, in addition to unique programming hosted by prime anchors. Peacock livestreams MSNBC’s Morning Joe, with the cable channel additionally producing unique reveals for the service. Fox Information replays its primetime reveals on Fox Nation, and livestreams some occasions just like the presidential main debates.
However the want for some kind of resolution is vital. Wells Fargo analyst Steven Cahall, who downgraded Fox Corp. in a July 10 notice, wrote, “Fox’s earnings are largely Fox Information earnings, and Fox Information is going through viewership and share pressures. With ecosystem dangers additionally elevated, we discover our estimate outlook extra destructive and beneath the Avenue.”
And that’s for essentially the most profitable channel in cable information; the others are all navigating comparable challenges on much less positive footing.
Talking with THR, a former colleague of Thompson’s on the Occasions praises him for what they known as “daring” management choices meant to transition the information outlet from its print roots to a digital future. CNN now finds itself in an identical boat, looking for to flee the legacy pay-TV enterprise searching for calmer waters. The temper inside CNN after his rent was introduced was a mix of hysteria about but extra change and optimism about having an skilled hand on the helm.
Thompson, for his half, advised staffers in a notice Aug. 30 that he supposed to use that Occasions playbook at CNN. “As everybody is aware of, TV journalism is approaching peak disruption. We face stress from each path – structural, political, cultural, you identify it. Like many different media organizations, CNN has lately felt among the uncertainty and heartache that comes with all of that,” he wrote. “There’s no magic wand that I or anybody else can wield to make this disruption go away. However what I can say is that the place others see risk, I see alternative – particularly given CNN’s nice model and the power of its journalism.”
However reworking a enterprise in decline isn’t any simple process. The influence of that lengthy decline has manifested itself within the type of layoffs and cost-cutting. CNN, in fact, had important layoffs underneath former head Chris Licht, however CBS Information, NBC Information, MSNBC and ABC Information have been no completely different. Even Fox Information, which as soon as prided itself on stability, acknowledged in its newest earnings report that it was lowering bills at Fox Information, particularly in digital and “newsgathering prices.”
Transformation requires funding, and it’s not instantly clear how a lot WBD is prepared to spend money on CNN given its cost-cutting ethos over the previous yr and a half. Whereas the cable bundle could also be slowly melting, that doesn’t imply that these channels have a protracted window to remodel. That’s very true for CNN, which finds itself in a scores and relevance funk.
“You’ve received to maneuver fairly rapidly, and I feel on this case, that’s exacerbated by the approaching 2024 political season ramping up,” a prime media govt says of Thompson’s priorities. “What I’d be afraid of, is that if CNN doesn’t obtain actual relevance within the 2024 election, will probably be laborious to get it again. I don’t assume there may be the posh of time.”
The rise of impartial choices, be they podcasters like Joe Rogan, Pod Save America and Megyn Kelly or upstart cable channels like NewsNation and Newsmax, have additionally siphoned away some cable information loyalists.
And whereas the cable bundle could also be slowly melting, that doesn’t imply that these channels have a protracted window to remodel.
In his McKinsey case examine, Thompson opined that “the laborious stuff for this firm is the brand new stuff.” At CNN, the problem will probably be constructing that new stuff, whereas repairing the outdated.