How Does CNN Make Money? The CNN Business Model In A Nutshell

Cable News Network (CNN) is a news-based pay television channel headquartered in Atlanta, Georgia. As a cable channel, first and foremost, CNN generates income from a few sources: advertising, video affiliate network, cable subscriptions, and repackaged content.

Aspect	Description
Advertising Revenue	CNN generates a substantial portion of its revenue through advertising. The network offers advertisers the opportunity to reach its vast viewership through various advertising formats, including commercials during television broadcasts, digital ads on its website and mobile apps, and sponsored content. Advertisers pay CNN based on factors such as the ad’s placement, reach, and format. Advertising revenue is a primary source of income for CNN.
Cable and Satellite Carriage Fees	CNN earns revenue from cable and satellite carriage fees paid by cable and satellite television providers for the right to include CNN in their channel lineups. These providers negotiate agreements with CNN and pay licensing fees to carry the network. These fees are typically based on the number of subscribers who have access to CNN through the provider’s service.
Digital Subscriptions	CNN offers digital subscriptions to its content through platforms like CNN+ (CNN Plus). Subscribers pay a monthly fee to access premium content, including live streaming of CNN’s television broadcasts, exclusive documentaries, and additional digital features. Digital subscriptions provide CNN with a recurring revenue stream and diversify its income sources.
Syndication and Licensing	CNN syndicates its news content to other media outlets, both domestically and internationally. It also licenses its content for use in various formats, including print publications, websites, and radio broadcasts. These syndication and licensing agreements generate revenue for CNN by allowing other media organizations to use its news content.
Event Hosting and Conferences	CNN hosts events, conferences, and forums on various topics, including politics, business, and culture. These events may feature high-profile speakers and experts. Revenue is generated through ticket sales, sponsorships, and exhibitor fees. Hosting events provides CNN with an opportunity to engage with its audience and monetize its expertise in journalism.
Affiliate Sales and Merchandise	CNN may generate revenue through affiliate sales and the sale of merchandise, such as books, documentaries, and branded products. Affiliate programs involve earning a commission for promoting products or services through affiliate links. CNN may also sell merchandise related to its news coverage and programming. These additional revenue streams contribute to CNN’s overall income.
Challenges and Competition	CNN faces challenges related to competition in the media industry, as there are numerous news outlets and digital platforms vying for audience attention and advertising dollars. Maintaining viewership and relevance, addressing issues related to trust and accuracy in journalism, and adapting to changing media consumption habits are ongoing challenges.
Future Growth Strategies	CNN’s future growth strategies may involve: – Digital Expansion: Continuing to invest in digital platforms and streaming services to reach a broader audience. – International Expansion: Expanding its presence in global markets through localized content and partnerships. – Content Diversification: Expanding its content offerings beyond news into areas like documentaries, lifestyle programming, and entertainment. – Subscriber Engagement: Enhancing subscriber offerings and engagement on digital platforms.

Table of Contents

History of CNN

Cable News Network (CNN) is a news-based pay television channel headquartered in Atlanta, Georgia.

The multinational was founded in 1980 by media proprietor Ted Turner and Reese Schonfeld. Anchored by husband and wife team David Walker and Lois Hart, CNN became the first 24-hour news service.

In the process, it also became the first American channel devoted entirely to news coverage.

In the ensuing decades, the reach of CNN expanded significantly. Content now encompasses multiple cable and satellite television, website content, and specialized closed-circuit channels.

The company now operates no fewer than 42 bureaus, 31 of which are based internationally. A second, dedicated news channel called CNN2 (the precursor to HLN) launched in 1982.

During the 1990-91 Gulf War, CNN was the only news outlet with the ability to communicate from inside Iraq. This bolstered the network’s reputation as a news provider and also made some of its (previously unknown) reporters household names.

Today, the company remains a popular source of news content. With approximately 2.366 million primetime viewers, CNN is second only to Fox News for viewership.

CNN revenue generation

As a cable channel first and foremost, CNN generates income from a few sources.

Let’s now take a look at each.

Advertising

When a brand wants to run advertising on a CNN-owned channel, it must pay an advertising fee. This fee is likely to be significant given the channel is ranked second for prime time viewership in the United States.

Brands can also pay to promote themselves on the CNN website, which is heavy in news article sidebar and footer advertising.

Video Affiliate Network

The CNN Video Affiliate Network (VAN) is a form of hosted revenue sharing. Here, the company provides the technical infrastructure necessary for affiliates to host content on their local news websites.

Once the videos are live, CNN collects advertising revenue which it then shares with the affiliate.

VAN content incorporates:

CNN ad sales – where inventory is bundled and made into a national network suitable for sale to national advertisers.
Content hub – which aggregates, normalizes, and synchronizes CNN content with content provided by local news services.
Local news organizations – who manage their local inventory and can monetize content at their discretion.

Cable subscriptions

CNN also makes money via cable subscriptions. When a viewer purchases a cable subscription, the cable company pays CNN a fee to include its content in the package. This charge – which is sometimes called the fee-for-carriage – is typically around $8 per year per subscriber.

It should be noted that this fee is charged regardless of whether the customer actually watches CNN.

Repackaged content

CNN also repackages news content in limited scenarios. News is provided to airports on a closed channel and a similar service is also offered in some hotels.

Lastly, foreign networks may also pay CNN to repurpose content for their news bulletins.

Key takeaways:

CNN is an American multinational news-based pay television channel. Founded by Ted Turner and Reese Schonfeld, it became the channel to offer dedicated, 24-hour news coverage.
With high prime-time ratings, CNN likely makes a significant amount of money from TV advertising. Digital advertising is also prevalent on the CNN website.
CNN also collects a fee-for-carriage, or a fee cable providers must pay for hosting its content. In limited circumstances, the company also sells repurposed content to hotels, airports, and foreign affiliated networks.

Key Highlights

Introduction:
- Cable News Network (CNN): A news-based pay television channel headquartered in Atlanta, Georgia.
- Founded in 1980 by Ted Turner and Reese Schonfeld.
History:
- CNN became the first 24-hour news service, dedicated entirely to news coverage.
- Expanded reach to multiple cable and satellite TV, website content, and specialized channels.
- Operates 42 bureaus, including 31 internationally.
Revenue Generation:
- Advertising:
  - Brands pay advertising fee to run ads on CNN-owned channels.
  - CNN website features news article sidebar and footer advertising.
- Video Affiliate Network (VAN):
  - Provides technical infrastructure for affiliates to host CNN content on their local news websites.
  - CNN collects ad revenue and shares with affiliates.
- Cable Subscriptions:
  - Cable companies pay CNN a fee to include content in cable packages.
  - Fee-for-carriage, around $8/year/subscriber, regardless of actual viewership.
- Repackaged Content:
  - Provides news content to closed channels in airports and some hotels.
  - Foreign networks pay to repurpose CNN content for their news bulletins.
Key Points:
- CNN generates income from advertising on TV and website.
- Cable subscriptions contribute revenue through inclusion in cable packages.
- CNN Video Affiliate Network shares ad revenue with local affiliates.
- Repackaged content is sold to airports, hotels, and foreign networks.