Warner Bros. Discovery has suspended all external marketing spend for CNN+ and has laid off CNN's longtime chief financial officer as it weighs what to do with the subscription streaming service moving forward, five sources tell Axios.
Inside CNN, executives think the launch has been successful. Discovery executives disagree. CNN+ has roughly 150,000 subscribers so far.
Warner Bros. Discovery wants to eventually build one giant service around HBO Max.
New leadership has replaced CNN CFO Brad Ferrer with Neil Chugani, Discovery's current CFO for streaming and international, as part of a broader finance team restructuring. Other high-level positions at WarnerMedia across different business functions are likely to be eliminated to cut costs and streamline leadership in coming weeks.
Executives are frustrated that new leadership is moving quickly to dismantle what they see as an eventual lifeline for the cable network.
Discovery executives are frustrated that the service launched. If CNN held off launching CNN+ until after the merger, it would have been easier to pivot the company's efforts towards something better aligned with Discovery's goals.
The big picture: Blame bad timing, limited communications and misaligned incentives for how CNN and Discovery got strategically misaligned on such a massive product rollout.
Fearing regulatory scrutiny, former WarnerMedia former parent AT&T and Discovery avoided direct communication about CNN's strategy until the deal officially closed.
While Discovery executives felt they made their priorities publicly clear, CNN executives didn't feel corporate pressure from WarnerMedia to pause the rollout, according to four WarnerMedia sources.
Former CNN head Jeff Zucker's sudden exit in early February didn't help solve for some of those communications issues.
CNN's new leader, Chris Licht, doesn't officially begin until May 2nd, but has joined Zaslav on meetings.
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