Jim Walton is stepping down as president of CNN Worldwide. (Stuart Ramson, Associated…)
Unable to reverse a dramatic ratings decline, CNN Worldwide President Jim Walton announced Friday that he is resigning at the end of the year.
"CNN needs new thinking," Walton said in an email to the CNN staff. "That starts with a new leader who brings a different perspective, different experiences and a new plan, one who will build on our great foundation and will commit to seeing it through."
No successor was named for Walton, who has been with Time Warner's CNN for over 30 years and has run it for close to a decade.
Pressure has been growing on Walton to improve CNN's sagging performance for the past several years. Though CNN Worldwide is very profitable — Time Warner Chief Executive Jeff Bewkes told shareholders in May that it should make more than $600 million in 2012 — CNN has lost ground in the United States to News Corp.'s Fox News and Comcast's MSNBC.
"CNN doesn't have an identity anymore," said Christopher Harper, a former ABC News correspondent and journalism professor at Temple University.
Launched in 1980 as the nation's first 24/7 news channel, CNN has prospered in times of crisis but has been challenged during slower news cycles.
"CNN's strength is also its albatross," said Frank Sesno, a former CNN correspondent who is now the director of George Washington University's School of Media & Public Affairs.
That has become more the case in the digital age as more viewers obtain information online and turn to cable for perspective and commentary. That has made CNN's digital platforms a "multi-platform news behemoth," according to Sesno.
But at the same time it has hurt the network. "People don't need CNN for the news anymore," Sesno said.
CNN's efforts to become more personality driven in prime time have also fallen short. Piers Morgan, who was hired with great fanfare as Larry King's replacement at 9 p.m., has not performed as well as the channel had hoped. Anderson Cooper has a solid reputation as a globe-trotting correspondent but that has not translated into a big audience for his 8 p.m. program. At 7 p.m., former CNBC reporter Erin Burnett is still trying to establish herself.
So far this year, CNN is averaging 586,000 viewers in prime time. In 2008, also an election year, CNN's average prime-time audience was 1.3 million. Its total day audience for the same period has fallen to 373,000 viewers, compared with about 700,000 in 2008.
The woes at the domestic channel have — unfortunately for Walton — overshadowed the unit's performance overall under his leadership. CNN International, its global channel, is a force around the world. CNN's website CNN.com is also very successful both in attracting users and revenue.
"When Jim Walton assumed the presidency of CNN in 2003, it was underperforming and earnings were in serious decline," said Time Warner's Bewkes in a statement. "Since then, he and CNN have tripled earnings, doubled margin and delivered annual growth of 15%."
Despite Bewkes' praise for Walton's tenure at CNN, he too had expressed frustration both internally and to Wall Street analysts lately at the inability to turn around CNN. That has led many inside and outside CNN to speculate that he was eager to see a change in leadership.
Just two months ago, Walton told the Wall Street Journal that he had no plans to leave CNN despite the problems. "I enjoy what I do ... and I plan to keep doing it for a while," Walton said.
But in his email to staff, Walton said he had been discussing "for some time" leaving his post with his direct boss Phil Kent, the chief executive of Turner Broadcasting. Kent is known to have been very close to Walton and protective of him in the wake of the criticisms. In a note to staff, Kent said Walton is "the leader we all aspire to be."
A spokesman for Time Warner denied that Bewkes had pushed for Walton to step aside. "The decision and timing are Jim's alone," said spokesman Jeff Matteson.
Whoever succeeds Walton will need to decide what CNN's priorities will be going forward. The big question is whether the network should continue to search for personalities that can compete better with Fox News and MSNBC or get back to its hard news roots.