CNN Tried to Create a Streaming Service, It Died in 30 Days.

[00:00:00]On March 29th, 2022, CNN launched a streaming service called CNN Plus. They bet everything that it would succeed, investing $300 million, a roster of talent poached from rival networks, and the full confidence that one of the most recognized names in news could sell a monthly subscription.

[00:00:20]Just 32 days later, the service was dead and hundreds of employees were laid off.

[00:00:24]>> Tonight, it is Goodbye CNN Plus, less than a month after its launching day.

[00:00:29]Today, CNN says its streaming service will shut down at the end of the month.

[00:00:33]>> CNN Plus became the fastest major platform collapse in streaming history.

[00:00:38]So, how did one of the most powerful brands in news burn $300 million that fast? And what does that say about where streaming is headed next?

[00:00:46]>> Years of development possibly down the drain. Some of the shows may never be seen. Hundreds of staffers may be laid off.

[00:00:53]>> Streaming is dead.

[00:00:56]By early 2022, the streaming land grab was already over. Netflix had 222 million subscribers. Disney Plus, HBO Max, Amazon Prime, Hulu, Paramount Plus, Apple TV Plus, Peacock, and Discovery Plus had all carved out their audiences.

[00:01:14]CNN was the only major media brand without a seat at the table, and its own parent company, Warner Media, was building HBO Max without them. Disney Plus was the success story CNN kept pointing to. It hit 10 million subscribers in its first 24 hours and crossed 100 million in under 16 months.

[00:01:32]A milestone that took Netflix 10 years to reach. Those numbers made streaming look like a guaranteed bet.

[00:01:39]>> Oh my gosh, I'm just so excited about Disney Plus right now. I mean, this is crazy. So, >> but Disney had Marvel, Star Wars, Pixar, and decades of content that entire generations grew up with. People were subscribing to their childhoods and Disney had a lifetime of that ready to stream. While CNN had Eva Longoria making tacos, inside CNN, executives were watching cable subscriptions drop quarter after quarter. Their core audience had a median baby boomer age of 67 to 68 by late 2024, making it one of the oldest demographics in all of cable news. So, they were stuck. Young people didn't want to have anything to do with mainstream media outlets like CNN.

[00:02:22]>> Benzy doesn't like anything to be overproduced. I mean, the reality is that our generation has been taught from the moment that we got these devices that you can't trust anything that you see online. And if everything is online, you're not going to trust anything because you've been taught not to. So, I think that has been a core part. You know, Nelly was talking about the decline in trust in news. And I think that's a part of why our generation is so distrusting is because and they're very discerning and they want to know like you like you asked, you know, what is the motive behind for for them they'll they'll take a fact as a fact but they want to know the motive behind it.

[00:02:55]>> Gen Z was getting their news from Twitter, YouTube, or basically any source with independent news coverage, not mainstream media. The cable audience CNN depended on was shrinking, and the younger audience they needed had never watched cable in the first place. CNN's president, Jeff Zucker, saw streaming as the only path forward. According to internal accounts from CNBC, Zucker and his team envisioned CNN Plus as something like the New York Times, a subscription news product that would eventually replace the cable network entirely. They even believed CNN had a global branding advantage strong enough to capture younger generations worldwide. The plan was simple. Launch CNN Plus early in 2022, then bundle it with HBO Max by September. Warner Media executives called this their would you like fries with that bundle?

[00:03:45]Piggybacking on HBO Max's millions of subscribers to funnel them towards CNN Plus. On paper, it looked simple.

[00:03:52]>> Lots of questions about Netflix and whether it might actually be a takeover target. Wow. Netflix stock plummets, bringing uncertainty to the streaming world. But the market they were walking into had already started to crack. 62% of streaming users were reporting subscription fatigue by 2022. And 150 million people were expected to cancel a paid streaming subscription that year alone. Netflix, the company that started the entire streaming revolution, lost 200,000 subscribers in the first quarter of 2022 and nearly a million more in Q2.

[00:04:26]Both quarters fell inside the exact window CNN Plus launched, and people had already started cycling through services, subscribing for a month or two and canceling before the next bill. CNN Plus even had its own internal research warning them. A May 2021 study showed that audiences didn't want a new streaming service talkless from legacy media personas. But CNN had the backing from men in suits, so they went allin with $300 million and a bet that the CNN brand was strong enough to cut against every trend in the industry. Spoiler, it wasn't. CNN didn't just launch a streaming app. They recruited talents like they were assembling the Avengers whose mission was to build a rival network from scratch. Chris Wallace, famously known for his Putin interview, walked away from Fox News in December 2021 after 18 years, reportedly for an $8 million contract to anchor a CNN plus interview show.

[00:05:22]>> After 18 years, this is my final Fox News Sunday. I'm ready for a new adventure, and I hope you'll check it out.

[00:05:29]>> Other popular journalists like Casey Hunt and Audie Cornish left their jobs for a product that hadn't proven a single person would pay for it. Behind the talent wall, CNN was scaling at a pace that matched the confidence. They hired over 500 employees in roughly 6 months. Producers, software engineers, marketing teams, all building toward a launch date. Their parent company, Warner Media, had plans to spend $1 billion on CNN Plus over the next four years, a budget that signaled this was the direction CNN planned to take the entire company. Inside CNN, people talked about CNN Plus, like it was the second coming of Christ.

[00:06:09]>> It's kind of like Netflix and HBO Max.

[00:06:11]You can see it there because you sign up and you get a library of TV shows and films. But it's different because you also get live news and interactive interviews. They projected it would be more profitable than cable, that their big bet was about to pay off. In fact, they had estimated nearly 30 million global subscriptions after launch with 2 million of that coming within the first year. This was supposed to be their Ted Turner moment all over again. Then everything started to go terribly wrong, starting from the company itself. By March 2022, CNN had sunk $300 million into CNN Plus, hired 500 people, and pulled in some of the most recognizable faces in cable news. All while publicly calling the launch one of the most important moments in the network's history. 6 weeks before launch, the person who built the whole thing walked out the door. On February 2nd, 2022, 6 weeks before CNN Plus was supposed to launch, CNN's president, Jeff Zucker, resigned from office. He told staff he had failed to disclose a romantic relationship with his closest colleague.

[00:07:17]CNN's chief marketing officer, Allison Golst, also resigns. CNN claimed she violated company policy. The two most important people needed for the launch had resigned 6 weeks before launch day, but the plan to launch didn't stop.

[00:07:32]About 150,000 people signed up in the first 2 weeks, but only 4,000 of them remained active. For context, Nebula, a creatorowned streaming service, hit 100,000 paying subscribers in its first year with a budget of $100,000.

[00:07:48]CNN spent nearly 3,000 times that amount only to barely outperform it. on CNN Plus. There was no message. It was a business decision, right?

[00:07:57]>> Uh we looked at it and we looked at the data. The number of users, they had spent an enormous amount of money trying to sell an independent product. The subscribers weren't there. The users weren't there. We looked at it together.

[00:08:08]We had a chance to look at all the data.

[00:08:10]And when we looked at the data, >> they saw no hit show coming, no growth trajectory, and daily active users were falling by the day. On April 21st, CNN Plus employees were called into a mandatory meeting with HR. They arrived late to the meeting and instantly felt the energy was off. Shortly after it started, everyone received an email confirming CNN Plus would stop streaming on April 30th. One new hireer who left his stable job for CNN was also called to the room to discuss his future at the company and reportedly texted his roommate, "I'm getting fired." CNN Plus had launched and died before completing a single billing cycle. It burned through $300 million and hundreds of careers in 32 days. But everything CNN Plus did in a single month is what the rest of the streaming industry has been doing for over 5 to 10 years. First came the ads. Streaming sold itself as the escape from commercials. That promise has been quietly dismantled across every major platform. Netflix, Disney Plus, Hulu, Peacock, and Max all introduced adup supported tiers. But Amazon went further. On January 29th, 2024, Prime Video inserted unskippable ads into every existing subscribers account by default. There was no opt-in or even a warning email beforehand. If you wanted the ad-ree experience, you had to pay an extra $2.99 per month. Premium bloody service. I thought the whole point of paying for a video streaming service was so that you didn't need ads.

[00:09:41]>> With only 15% of US Prime Video users opting to pay more, 85% of the subscriber base was converted into an ADUP supported audience overnight. And the community did not take this lightly.

[00:09:53]Like [ __ ] going to be paying Jeff Bezos any more money. I gave up Netflix for price gouging and worsening content. I think I can do the same for Prime. Then there's the content. Remember the same parent company that killed CNN Plus?

[00:10:06]That same company went on a deletion spree across HBO, removing titles that the community were very much still watching to save cost and doing this while raising prices. When CNN Plus shut down, subscribers at least got refunds, but the content, the shows, the interviews, and the original programming ceased to exist. The money came back, but the product didn't. And across the industry, that pattern has accelerated.

[00:10:31]Now people are paying a monthly fee to access a library that the company can change, shrink, or erase whenever it decides to. We literally went in a giant circle just to get ripped off again. CNN Plus compressed that whole cycle into 32 days. The rest of the industry has had years to do the same thing, just gradually enough that each individual change feels minor until you add them all up.