NEW YORK — The scapegoating at CNN has begun in earnest, and the first casualty of the cabler’s declining fortunes is Rick Kaplan.
Kaplan will announce his resignation as president of CNN U.S. at a noon staff meeting today, the victim of CNN’s diminishing ratings and its failure to create programming attractive to mass audiences.
CNN declined to comment Tuesday on Kaplan’s resignation.
The main beneficiaries of Kaplan’s ouster are likely to be Jim Walton, president of CNN/SI, who is slated to become president of CNN U.S.; Chris Cramer, president of CNN Intl., who becomes president of international networks and global news gathering; and Phil Kent, who shifts from president of Turner Intl. Broadcasting to chief operating officer of CNN.
Cramer succeeds Eason Jordan, who, in effect, gets demoted to chief news executive. CNN will be in flux over the next few months and more exec changes are in store.
As part of the new personnel structure, Tom Johnson is expected to retire as chairman of the CNN News Group early next year.
The ankling of Kaplan and the wholesale reshuffling of CNN’s top executive positions could also signal the diminution in power of Ted Turner, who hired Kaplan with great fanfare in August 1997.
Instead of reporting to Turner, CNN now reports to Bob Pittman, who took over shortly after CNN’s parent Time Warner announced its merger with AOL, where Pittman is a top exec.
Kaplan had spent the previous 17 years at ABC, producing everything from “World News Tonight” and “20/20” to “Nightline” and many primetime specials.
Kaplan’s mandate was to pull in viewers during the many times of the year when no major news stories are breaking, periods during which CNN’s ratings tumble precipitously.
The news cabler’s ad revenues have grown each year, but much more slowly than those of most of the widely circulated cable nets with which it competes.
CNN’s ramped-up spending on news coverage and low-rated programs like the nightly 10 p.m. magazine “NewsStand” has cut drastically into the network’s profits, leaving Kaplan open to sniping from within the company’s corridors for importing a lavish broadcast-network mentality to the corner-cutting tradition of cable news.
“NewsStand” was CNN’s attempt at developing appointment viewing. But in a primetime landscape already saturated with newsmags, “NewsStand” never caught on with audiences.
The series, launched in June 1998, has also suffered bad publicity as a result of its report on “Operation Tailwind” alleging that U.S. soldiers used nerve gas in Laos during the Vietnam War. CNN had to retract the story.
Another strike against Kaplan was his role in edging former CNN Financial News prexy and CNNfn CEO Lou Dobbs out of his post in June 1999. Dobbs reportedly got into a nasty spat with Kaplan over the latter’s order that “Moneyline” be preempted for breaking news.
Dobbs’ exit was a big loss for CNN because the web’s nightly “Moneyline Newshour With Lou Dobbs” was its most profitable program.
Since Dobbs’ exit, “Moneyline,” now hosted by Stuart Varney and Willow Bay, has faced stiffer competition from CNBC’s “Business Center.” With Dobbs on board, “Moneyline” averaged 366,000 households during the second quarter of 1999. Over the same period in 2000, that number was down to 228,000.
Kaplan arrived at CNN just when its two national 24-hour-news competitors, MSNBC and Fox News Channel, began increasing their subscriber count and adding to their viewership, often at the expense of CNN.
Without a White House scandal or another tragedy on the scale of the massacre at Columbine High School, CNN has had a tough year. The cable-news giant, which is celebrating its 20th anniversary this year, saw its primetime household delivery plummet 35% during the second quarter compared with the same period last year, according to Nielsen figures.
Fourth consecutive decline
CNN also dipped 36% in total day delivery (from 394,000 homes to 253,000) during the same time period, marking the fourth consecutive quarter that it has decreased year-to-year in both primetime and total day. In fact, the last quarter marks CNN’s lowest in primetime household delivery since the fourth quarter of 1987.
While CNN won the recent political convention ratings race among the cable nets, it lost about a quarter of its total audience from the 1996 conventions.
Particularly troubling to CNN execs is the fact that Fox News Channel, which didn’t exist four years ago, finished a nerve-racking second behind CNN at the GOP confab even though CNN reaches a third more homes than Fox News.