When CNN went live in 1980 it was revolutionary. At that time, however, it was only available in a handful of households.
This was a time when cable television was just getting its start. Ted Turner, the company's founder, was a pioneer in that industry. He helped to usher in era on television with the likes of TBS, one of the United States first superstations.
CNN gained a lot of notoriety during the first Gulf War, when it had camera on many vessels that were launching missiles into Iraq. For the first time, war was televised in real time.
This ushered in a long run for cable news. CNN was joined by FoxNews and MSNBC as part of the 24 hour news cycle.
Unfortunately for these entities, the time of their relevance is long passed.
The Upcoming Death of Cable News
The entire media world is undergoing a transition. For many entities, they will survive through their ability to adapt. This does not include cable news.
For this industry, that ship has sailed.
We discuss the fragmentation of the media a great deal. With cable news it is more than that.
The end of cable news is assured. We know this simply because of death. We are not referring to the death of the networks. Instead, it is literal death.
As Los Angeles times reporter Stephen Battaglio recently wrote, the median age of the CNN, Fox and MSNBC audiences is, respectively, 67, 68 and 71. But this isn’t necessarily a bad thing for the industry.
While many try to put a positive spin on it, this is an increase from 61, 63, and 65 respectively in 2017. That means the audience is aging with the passage of time. Another way to frame this is younger audiences are not being captured.
This poses a problem since Baby Boomers are dying off. The Millennials are not going to tune into CNN nor is GenZ. Those people are not really even from the cable era.
Another added issue is the number of cable subscribers are decreasing. According to a search with Groq, here is what those numbers look like.
2007: 104.9 million
2008: 105.4 million
2009: 104.5 million
2010: 103.4 million
2011: 102.3 million
2012: 101.3 million
2013: 98.6 million
2014: 96.4 million
2015: 94.4 million
2016: 92.3 million
2017: 90.3 million
2018: 87.3 million
2019: 84.8 million
2020: 82.3 million
Reports are the cord cutting hasn't stopped meaning these numbers are even lower.
This does not help the cable news channels who depend upon these subscriptions to get their viewers. Attempts at streaming proved futile.
The reality is that the non-Baby Boomers are getting their news from elsewhere. It is something that is reflected in all the numbers.
With the combination of an aging/dying customer base along with cord cutters, the future of cable news is very dark.
Wall Street Taking Notice
The latest earthquake to his the industry is the write taken by Warner Bros Discovery. On the earnings call, it reported a $9.1 billion write down on its television stations.
What this means is the company was carrying the value of these assets on its books at a much higher rate than market value. Obviously, companies will try to put this off as long as they can. However, it got so back that Warner Bros had no choice.
Warner Bros. Discovery Inc., the parent of CNN and TNT, posted a second-quarter charge of $9.1 billion after writing down the value of its traditional TV networks.
The company, created in 2022 when Discovery Inc. acquired WarnerMedia, has concluded that cable channels like CNN and TNT are no longer worth what they were when the $42 billion merger was completed.
This is a major issue for a company that has a market cap of $17 billion. It mean that an acquisition of $42B is now in the hands of a company that has a total worth of $25B less.
The real question here is what has value.
Time Warner has powerful library. According to Wikipedia, the company has the likes of Harry Potter, Lord of the Rings, and DC Comics along with Hanna Barbara.
How much would these assets be worth on the open market if sold individually?
The point being that it appears most of the value remaining for Warner Bros Discovery is in the library they own. It traditional television assets are not worth a great deal.
Unfortunately, this is not a situation which applies only to CNN. It is all the cable news networks as they face the same issues. FoxNews and MSNBC are in the same boat.
When people are getting their news and information from social media such as FB, X, and YouTube, there are few eyeballs left to tune into the cable news channels.
As the cord cutting numbers show, even less people are able to do as compared to before.
The next decade will see a continued decline until the eventually fade away. We might see a few more mergers as companies try to fend off the reality of what is taking place.