Discovery CEO David Zaslav dropped his usual quota of names during the company’s quarterly earnings call — John Malone, Jack Welch, Oprah — but one name didn’t come up: Jeff Zucker.
This month’s ouster of the former CNN boss, a personal friend of Zaslav’s, is an 11th-hour headache at the news network as Discovery nears the close of its $43 billion merger with WarnerMedia. The transaction is expected to take effect in April, around the same time streaming service CNN+ hits the market.
Zaslav was asked during the call about the overlap between CNN+ and Discovery’s streaming operations, which include news. The exec said that because the merger hasn’t closed, no firm plans have been made. He then went on to offer a full-throated endorsement of CNN.
As the Discovery conference call was happening, viewers were tracking Russia’s hours-old invasion of Ukraine, which Zaslav called “a proud moment” for the news network.
“I’ve been watching a lot of CNN,” he said. “This is where you see the difference between a news service that has real, meaningful resources globally, news-gathering resources — the biggest and largest group of global journalists of any media company, maybe with the exception of the BBC.
“Here we are waking up this morning with a war. CNN is going to multiple correspondents and journalists risking their lives in Ukraine, in Poland, in Russia, on the ground. And there’s no news organization in the world that looks like CNN, that can do what CNN does. It becomes very clear as you go around the world and you look at other news channels, where people are sitting behind desks and giving their opinion about what’s going on, there’s a news network with people on the ground with journalists in bulletproof vests and helmets that are doing what journalists do best, which is fight to tell the truth in dangerous places so that we all can be safe and assess what’s going on in the world.”
In terms of how CNN+ would be reconciled with other operations at Warner Bros. Discovery, Zaslav said that would be figured out in the coming weeks. “We will in the near term sit down and have a real business plan discussion with the people at CNN and CNN+,” he said. “We haven’t had that yet.”
As WarnerMedia ramped up HBO Max, which launched in May 2020, it folded targeted services like FilmStruck and DC Universe, which had launched as AT&T was in the process of taking control of the company. Despite subsequent efforts to consolidate streaming under the HBO Max tent, and promises by AT&T leadership that live news would be one of its features, CEO Jason Kilar has been a vocal supporter of CNN’s stand-alone streaming potential. As with ESPN at Disney and other traditional assets being reconceived in the streaming era, the question for CNN and Warner Bros. Discovery will be how to balance the two worlds. At launch, CNN+ is planning to have several live shows, but not the main linear feed available to pay-TV subscribers. It will also offer an array of on-demand shows from a roster of recognizable talent.
The military conflict in Ukraine is a clear-cut demonstration of CNN’s breaking-news capabilities, but the task for Zaslav and the combined company’s leadership will be to figure out its day-to-day approach. Political orientation and opinion will be key considerations. CNN has matched the strategy of Fox News and MSNBC to a large extent in primetime but has not had the same consistent ratings performance. Malone, a major Discovery shareholder and a key architect with Zaslav of the WarnerMedia deal, has expressed his hope that CNN will “actually have journalists.”
That comment by the media billionaire last year to CNBC was interpreted as a shot at Zucker, who presided over ratings growth and won widespread favor in the newsroom but also made questionable decisions. His call to let prime-time anchor Chris Cuomo interview his brother, former New York Gov. Andrew Cuomo, numerous times in 2020 boosted viewership but ultimately paved the way for Zucker’s exit. WarnerMedia said an investigation found ethical lapses by Zucker and CNN marketing and communications exec Allison Gollust, who had a romantic relationship. Chris Cuomo, who continued to advise his brother during a wave of sexual misconduct allegations that led to his resignation last year, has pursued legal action against CNN for firing him. That case led to the revelations about Zucker, though his relationship with Gollust had been widely known since their days at NBCUniversal.
While some analysts and industry observers have wondered if Warner Bros. Discovery would consider spinning off CNN given the strategic conundrum, Malone has said that would be the “coward’s way out.”
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