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Al Jazeera Plans U.S. Invasion, With Currency

PURCHASE OF CURRENT TV OFFERS A 41M-SUBSCRIBER HEAD START 1/06/2013 7:00 PM Eastern

After years of failing to gain signifi cant traction with its service here, Al Jazeera made a bold play last week to gain major distribution footing in the U.S. by purchasing Current TV.

The pan-Arab news organization will offer a new channel, tentatively dubbed Al Jazeera America, from the 40 million subscribers it is gaining through the transaction for Current TV, the lowrated news and commentary service co-founded by former Vice President Al Gore and Joel Hyatt. Published reports place the deal’s value at some $500 million, with Gore slated to receive $100 million via the sale.

Al Jazeera, funded by the government of Qatar, will shut Current after a transition period and launch an English-language channel.

Upon news of the deal on Jan. 2, Time Warner Cable announced that it would drop Current, which was available to 9 million of its subscribers on the digital-basic tier. When a cable network is sold or changes its programming direction, distributors can revisit their deals.

A source confirmed that TWC, which previously indicated it had been considering dropping the ratingschallenged Current (see related story, page 7), made the move because of the change in ownership.

Although he would not discuss the purchase price, Al Jazeera spokesman Stan Collender said the deal was struck for 41 million subscribers.

“The presumption is that all the other providers will continue to carry the channel,” he said. “The Time Warner Cable situation was understood to be part of the deal.

” TWC, though, retains a long-term hunting license for Al Jazeera English.

“We are keeping an open mind and as the service develops, we will evaluate whether it makes sense for our customers to launch the network,” a TWC spokeswoman said, noting that Al Jazeera English is available for free online. She added that in New York and Los Angeles, the network is on the channel lineup as part of separate agreements between Al Jazeera and local broadcasters.

Despite awards and accolades for its coverage of the Arab Spring in 2011, Al Jazeera English has been unable to make much affiliate headway stateside, securing just 4.7 million subscribers thus far. As such, the new channel — provided no other defections occur — would count nearly 46 million subscribers.

Comcast and Verizon Communications declined to comment on whether they would carry the new service on channel slots that housed Current.

Current TV — founded in 2005 from the base of the 17 million-subscriber global news network Newsworld International — began as a programmer of content submitted by viewers via the Internet. It was rebranded as a left-leaning political news channel in 2011 with the hire of Keith Olbermann. His show, Countdown, imported from MSNBC, failed to generate big ratings, and Olbermann was fi red from the network last spring, following disputes with management.

Subsequent shows hosted by Jennifer Granholm, Cenk Uygur and others have also failed to break out, as Current TV drew just 42,000 viewers on an average night in 2012, according to Nielsen.

Collender said Current TV programming would remain on air for three months. Al Jazeera English then will be substituted for an indefinite amount of time as the new channel develops its programming lineup with an expected launch sometime in 2013.

TAKEAWAY

Al Jazeera’s purchase of Current TV could boost the news network’s thus far unsuccessful bid to crack the English-speaking U.S. market

September