July 27 (Bloomberg) -- CNN President Jim Walton, who presided over the once-dominant cable-news business as it lost viewers to Fox News, will resign after almost a decade in the job, saying the network needs “new thinking.”
Phil Kent, chief executive officer of CNN parent Turner Broadcasting, will lead the search for a replacement, according to a statement from the company, which is owned by Time Warner Inc. Walton, who has spent his entire 30-year career at CNN, plans to step down at the end of the year.
“CNN needs new thinking,” Walton said in a memo to 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.”
CNN is suffering through a ratings slump, with prime-time viewership dropping 8 percent to 627,000 on average this season through mid-May, compared with a year earlier, according to Nielsen. CNN ranks behind News Corp.’s Fox News, which drew an average prime-time viewership of 1.85 million in the same period.
Still, CNN has increased profit at a rate of 12 percent to 15 percent every year since 2004, Walton said in a December interview. Even with a decline in ratings, CNN has pulled in additional revenue through affiliate fees as it’s become more widely available on pay-TV systems.
Walton, 54, started at CNN in December 1981, one year after it was founded by billionaire Ted Turner. Walton helped build the nascent network into a dominant news organization, and CNN soon became a staple in many households. It was the only news company that broadcast live video feeds of the first Gulf War from inside Iraq.
In recent years, the network struggled to find a formula that connected with viewers. It also made a major gaffe last month, reporting incorrectly that the U.S. Supreme Court found a central piece of President Barack Obama’s Affordable Care Act to be unconstitutional.
Walton, a native of Bowie, Maryland, graduated from the University of Maryland and started his first job at CNN as a video producer.
“It’s the only place I’ve ever worked,” Walton said in December. “I feel really lucky to have started my career with CNN.”
Shares of New York-based Time Warner, which acquired Turner Broadcasting in 1996, rose 1.6 percent to $38.98 at the close in New York. The stock has climbed 7.9 percent this year.
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