CNN to Lay Off 6% of Workforce, Invest $70M in Digital Transformation
CNN, owned by Warner Bros. Discovery (WBD), will lay off approximately 200 employees, representing 6% of its staff. This move aligns with the company's strategy to transition into a digital-first newsroom.
WBD plans to invest $70 million in CNN's revamp, which includes launching a direct-to-consumer streaming product, enhancing premium digital ad experiences, refreshing the website, pivoting to digital video, and introducing a new lifestyle-oriented digital platform.
Despite the layoffs, CNN CEO Mark Thompson anticipates that the network's overall headcount will not decline significantly in 2023. He emphasized that the company aims to "shift CNN’s gravity towards the platforms and products where the audience themselves are shifting."
CNN's previous attempt at a direct-to-consumer streaming service, CNN+, was short-lived, lasting only a few weeks in 2022. Since then, the network has faced challenges, with prime-time viewership decreasing by 75% compared to its peak in 2020.
The declining performance of linear networks and high debt have prompted media companies to reduce costs, leading to industry-wide restructuring and layoffs. Speculation persists regarding potential future strategic options for WBD, including sales or spin-offs, especially considering the expiration of its post-merger lockup period last year.