By Benjamin Mullin, Joe Flint and Drew FitzGerald
CNN president Jeff Zucker survived plenty of corporate intrigue
since telecom giant AT&T swallowed up the cable network's
parent company two years ago.
Now that is changing, leaving Mr. Zucker frustrated and his
future at the cable news network in doubt.
Mr. Zucker, who has overseen CNN for seven years, felt
blindsided by a recent restructuring carried out by parent
WarnerMedia, and has had friction with its chief executive, Jason
Kilar, according to people familiar with the situation.
The 55-year-old's contract expires next year and he hasn't
committed to extending his deal in meetings with WarnerMedia brass
and communications with CNN employees, the people say.
Asked about his future in a town hall video chat on Wednesday,
Mr. Zucker said he loves his job, but added, "The industry is
changing, our company is changing, so I have a lot to think about,"
according to a recording of his remarks. He added, "I'll do that at
the right time."
Mr. Zucker said he won't make a decision on whether to stay at
CNN until after the election.
If this election is Mr. Zucker's last ride, he would leave CNN
after transforming its role in the cable news landscape and
becoming one of the most polarizing figures in media in the
process. On his watch, the network, once accused of giving Donald
Trump too much airtime during his first presidential run, has
become a critic of the administration.
CNN, like its rivals in cable news, has enjoyed a major ratings
lift during the controversies of the Trump years, especially in
election season. The network's ratings have increased about
threefold compared with where they were at the start of 2015,
reflecting similar gains at Fox News and MSNBC. CNN has been second
in the ratings for most of the year among viewers 25 to 54, the key
news demographic for advertisers, but trails rival MSNBC in total
viewers and is well behind ratings leader Fox News.
Mr. Zucker also placed big bets on digital growth, some of which
blossomed -- the network's main website expanded its audience --
and some that fell flat.
AT&T doesn't break out CNN's results separately. A person
familiar with the matter said the division has generated more than
$1 billion in annual profit in recent years. This year is proving
more challenging. During the town hall meeting, Mr. Zucker said he
expects CNN to miss its profit target by between $100 million and
$120 million, as digital and international advertising sales suffer
during the pandemic.
Some media and finance executives say CNN could be a spinoff
target for private-equity investors or blank-check companies known
as SPACs. AT&T has fielded interest from potential acquirers of
CNN on multiple occasions, including last year, according to people
familiar with the situation. But despite the headaches of owning a
network the president regularly attacks, AT&T has thus far held
on to it, viewing it as a valuable financial contributor.
Though Mr. Zucker's contract doesn't end until well into 2021,
he could leave before then; initial conversations about whether
he'll extend his employment have happened and are expected to
deepen after the election, the people familiar with the situation
The Information, a subscription news site focused on technology
and media, earlier reported Mr. Zucker was in discussions with the
company about his future. Mr. Zucker could be drawn to pursue his
other passions, which include politics and sports, people who know
him say. A person close to Mr. Zucker said he may just be ready to
move on following the election, after a long tenure at the
The media giant's successive waves of corporate reorganization
over the past two years have replaced executives at all levels from
its Warner Bros. television studios to the leadership at HBO. Mr.
Zucker had been the last man standing, maintaining control of his
news and sports fiefdom.
When Mr. Kilar succeeded John Stankey atop WarnerMedia earlier
this year, he carried out another overhaul in August that took away
from Mr. Zucker oversight of CNN's finances and human resources, as
well as communications -- an area run by one of Mr. Zucker's top
lieutenants, Allison Gollust. The changes annoyed and surprised Mr.
Zucker, the people familiar with the situation said.
Mr. Zucker has had his hand in just about every area of media --
morning TV, prime-time entertainment, sports and cable news -- over
a three-decade-plus career. He joined NBC News in 1986 as a
researcher for the network's coverage of the 1988 Olympic Games in
Seoul, South Korea, and rose through the ranks, becoming executive
producer of "Today" in 1991 at the age of 26. He helped to launch
the program into more than a decade of ratings dominance.
He later managed entertainment for NBC, where his greatest
successes included reality shows "Fear Factor" and "The
Apprentice," starring Mr. Trump.
He helped launch the streaming service Hulu, which Mr. Kilar ran
in its early years -- meaning that Mr. Zucker now reports to
someone who used to work for him. His run at NBCUniversal was
marred by his decision to replace "Tonight Show" host Jay Leno with
Conan O'Brien, only to soon reverse the move after bad ratings. He
left NBCUniversal as its chief executive after Comcast Corp. took
control of the company in 2011.
Mr. Zucker took over at CNN in 2013 and was promoted to oversee
WarnerMedia's sports properties last year. When Mr. Stankey was
tapped this spring to become AT&T CEO, opening up the
WarnerMedia CEO slot, the company considered Mr. Zucker for the
role, among other internal candidates, early in the process, people
familiar with the situation said.
AT&T wanted someone with a background in digital innovation
who could spearhead the company's push into direct-to-consumer
media, and felt Mr. Zucker's experience didn't make him the best
fit, the people said. Eventually AT&T decided to look outside
and hire Mr. Kilar.
In addition to reorganizing Mr. Zucker's executive team, Mr.
Kilar has his own vision for how to expand CNN's business,
including the possibility of creating a subscription streaming
service that would carry CNN programming, people familiar with Mr.
Kilar's thinking said. CNN has explored selling new subscription
products directly to viewers under Mr. Zucker, but so far those
plans haven't come to fruition.
AT&T hasn't yet decided how CNN's 24/7 news programming fits
into HBO Max, the streaming service that is Mr. Kilar's primary
focus at WarnerMedia. Mr. Kilar wants to give HBO Max subscribers
some version of CNN, according to a person familiar with the
matter, but the news network's existing contracts with cable and
satellite providers make that a tricky proposition.
Belt-tightening across WarnerMedia carried out by Mr. Kilar also
prompted Mr. Zucker to close Great Big Story, a short-form video
streaming channel that Mr. Zucker championed.
Mr. Zucker has taken heat from both sides of the political
aisle. Critics on the right say he has steered the network toward
opinion. Some CNN personalities, including prime-time anchor Don
Lemon, are openly critical of the president, and the network has
increasingly questioned the president's policies, handling of the
coronavirus pandemic and false claims -- sometimes putting
fact-checking into the "chyron" banners at the bottom of the
Critics on the left are frustrated he has signed up political
analysts such as former Republican senator Rick Santorum who are
often sympathetic to Mr. Trump.
Some critics on the right, including Fox News host Tucker
Carlson, say Mr. Zucker's attitude toward the president is
hypocritical. Earlier this year, Fox News aired recordings of
conversations from 2016 between Mr. Zucker and Mr. Trump's former
lawyer, Michael Cohen, in which Mr. Zucker could be heard fawning
over the then-candidate and proposing a weekly show for Mr.
The intrigue about Mr. Zucker's future comes as CNN is preparing
to cover its biggest story in years -- the 2020 election. Mr.
Zucker, the de facto executive producer of CNN, is planning for a
variety of scenarios, including a so-called "red mirage" -- an
early Republican lead caused by people voting on the day that
disappears once mail-in votes are tallied. The network is
scattering on-air talent across one-person studios in its offices
in Washington, D.C., Atlanta and New York, to limit the risk of
Mr. Zucker is known throughout CNN as an in-the-weeds manager
who delves into the minutiae of story selection, hangs around the
studio, tweaks production details and scrutinizes company finances.
He sends emails on weekends and late into the evenings,
recommending edits and suggesting stories for CNN.com. Editors and
producers on the receiving end of Mr. Zucker's emails call the
suggested articles "JZ stories," using their boss's preferred
Some CNN reporters and editors complain that Mr. Zucker is a
micromanager, annoyed that a business executive would inject
himself into news coverage. Others describe him as an intimidating
presence who doesn't work well with indecisive people and prefers
leaders with strong opinions. Some CNN employees grudgingly
acknowledge that although Mr. Zucker's late-night emails can be
onerous, they are rarely off-target.
AT&T is trying to trim a large debt load fueled by takeovers
such as its 2018 acquisition of then-CNN parent Time Warner. The
company has about $30 billion of debt that comes due through 2025.
Mr. Stankey has said he is looking across AT&T's operations,
including WarnerMedia, and will shed assets that aren't considered
core to the company's mission.
He is already preparing part of its Xandr advertising business
for potential sale and has shopped other assets including its
Crunchyroll animation service, according to people familiar with
AT&T has held on to CNN for more than just its profit
stream. Executives suspected that President Trump's well-known feud
with CNN influenced his Justice Department's decision to challenge
the Time Warner takeover, people familiar with the matter say.
AT&T eventually beat that antitrust lawsuit, but the litigation
cost it valuable time and money. The Justice Department has denied
that political motives played any role in the suit
The company's top brass considered holding on to the hard-won
prize a competitive necessity, the people said: The fear among
AT&T executives was that any perception the company had folded
under political pressure would weaken its hand in other policy
battles and could scare away creative talent at other parts of
AT&T's latest results drove home how much its telecom
services dwarf the rest of its media empire, including the cable
news channel. Revenue in the wireless division alone reached $17.9
billion last quarter, putting the cellphone carrier on track to
take in more than $71 billion this year.
CNN insiders see few candidates poised to succeed Mr. Zucker
within WarnerMedia. Among the candidates mentioned internally as
possible successors or at least placeholders are senior programming
executive Mike Bass, talent and acquisition head Amy Entelis and
newsgathering chief Virginia Moseley.
Mr. Zucker's replacement would need the programming acumen and
gravitas to manage the network's high-profile anchors, which
include Jake Tapper and Chris Cuomo, and the financial experience
to lead a large media company.
Mr. Zucker is aware of the increased scrutiny CNN faces as the
election looms, one of the people said.
During CNN's morning editorial call earlier this week, Mr.
Zucker told employees that the network needs to play "error-free
ball" over the next few weeks.
--Shalini Ramachandran contributed to this article.
Write to Benjamin Mullin at Benjamin.Mullin@wsj.com, Joe Flint
at firstname.lastname@example.org and Drew FitzGerald at
(END) Dow Jones Newswires
October 23, 2020 17:31 ET (21:31 GMT)
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