New CNN CEO Mark Thompson Tasked With Securing Long Term Sustainability of the Network
Key Takeaways
- New CNN CEO Mark Thompson will be taking the reins from sacked predecessor Chris Licht
- Thompson is a highly experienced media executive, previously having held positions as Director-General of the BBC and former president and CEO of the New York Times Company
- He’ll be tasked with growing the company’s profits with the aim of long term sustainability — focusing on CNN’s subscription news service and younger audiences via their CNN Max service
It’s been a bit of a turbulent time for CNN in recent years. Like many news networks, they’ve come under fire for their editorial decisions, and faced challenges to profits as advertisers spread their marketing spend across a much wider range of media.
Under the tenure of recently sacked CEO Chris Licht, it’s that first issue that was top of the agenda. Licht had been tasked with fixing the editorial tone of the network and becoming more focused on facts centered news reporting.
That’s in comparison to the majority of the cable news network industry, which CNN parent company Warner Bros. Discovery CEO David Zaslav has referred to as ‘advocacy networks’.
There have been widespread changes to CNN’s programming under this mandate, but now Licht is out and Thompson is in. He’s got a different set of tasks ahead of him. Here’s the plan for CNN, and what it might mean for investors.
Thompson’s new objectives
So while Licht was focused heavily on the editorial future of CNN, Thompson key objectives relate to the other side of the modern media company coin. Namely, growing the business. Specifically, it’s expected that he’ll be pushing to grow the networks subscription business on CNN.com, and to widen the customer base through targeted programming for a younger demographic.
That plan will be focused on CNN Max, which is a live news service provided through Warner Bros. Discovery Max streaming service. Honestly, he should probably work on the naming conventions for all these offerings while he’s at it.
What this means for Warner Bros. Discovery shareholders
Warner Bros. Discovery is a behemoth, hence the confusing and overly long names for everything. The overall parent company now owns a huge number of big media properties, including Discovery, CNN (obviously), Warner Bros. Film and Warner Bros. TV, DC Comics, HBO and Warner Bros. Sports (which includes TNT, TBS and AT&T Sportsnet).
When it comes to media power, it doesn’t come much bigger than Warner Bros. But even with such a vast number of valuable media properties, CNN is the most important news network in the portfolio and one of the most valuable news properties in the world.
That means that for Mark Thompson, the success or failure of his time at CNN has the potential to add (or detract) major shareholder value. Despite the underlying fundamental profit drivers of the company, CNN is very much a face of the broader Warner Bros. Discovery parent company.
That means that investors will want to watch the strategic decisions carefully to gauge how the stock price of Warner Bros. might be impacted. Thompsons aim over the next five years is to turn CNN into a more sustainable business. If he achieves that, it will obviously be a positive result for shareholders.
The bottom line
Change is coming for CNN as new CEO Mark Thompson looks to find the company’s place in the always-changing media landscape. Unlike previous CEO Chris Licht, success or failure will be far easier to measure for Thompson, with the aim to improve CNN’s net profit in a sustainable way for the long term.
For investors, media remains a high risk, high reward space to play in, with a huge amount of competition concentrated amongst a small number of players with deep pockets.
