Al-Jazeera to end U.S. channel

The cable outlet targeting American viewers will shut down for economic reasons.

When al-Jazeera America was launched to great fanfare in 2013, its then-leader told The Wall Street Journal that it planned to skip tabloid fare in favor “fact-based, indepth, long-format news” in part because it didn’t have to worry too much about profits.

After all, it was backed by the oil-and-gasrich government of Qatar, and oil was trading around $100 a barrel.

On Wednesday, with oil trading near $30, al-Jazeera made an about-face, announcing it was shutting down the American cable channel by April 30 for economic reasons.

“While al-Jazeera America built a loyal audience across the U.S. and increasingly was recognized as an important new voice in television news, the economic landscape of the media environment has driven its strategic decision to wind down its operations and conclude its service,” wrote Al Anstey, a longtime al-Jazeera executive who took over as CEO of the American channel in May after its founding CEO was ousted in the wake of discrimination suits.

The move follows broader announcements from Doha in recent months that there would be significant cutbacks at al-Jazeera, which runs several channels, including its flagship Arabic channel and an international channel in English that isn’t currently distributed in the U.S., according to people familiar with the matter. The government of Qatar, which backs al-Jazeera, gets about 90 percent of its budget from the energy sector, according to the IMF.

But the U.S. channel faced acute financial challenges of its own. After purchasing Al Gore’s Current TV for nearly $500 million, al-Jazeera sank more than $2 billion into al-Jazeera America, according to people familiar with the matter. It hired about 800 journalists at launch and opened 12 bureaus around the country.

The channel steered clear of the traffic chases, celebrity gossip and political shouting matches. Its on-air look was stripped of the graphics that fill the screens of CNN,

Fox News, MSNBC and other outlets. The strategy paid off in the journalism community as the channel won awards for its work.

Getting ratings and distribution proved more challenging.

The channel, in 60 million homes, had to fight so hard to keep distribution that it sometimes ended up paying distributors, according to people familiar with the matter. Competing cable-news networks are in 90 million homes or more. Al Jazeera America’s television audience was very small, often fewer than 25,000 viewers.

Partly as a result of its weak negotiating position, Al Jazeera America was forced to stop streaming Al Jazeera English online in the U.S., which had helped it build influence thanks to its close-up coverage of the Arab Spring.

Al Jazeera said it will now “expand its existing international digital services to broaden its multiplatform presence in the United States.”

In addition, the channel carried baggage from its name and faced challenges of overcoming perceptions of anti-American bias. There is still hostility among many Americans because Al Jazeera’s Arabic channel provided an outlet for Osama bin Laden after the Sept. 11, 2001, terrorist attacks.

That rancor never really left. When the network recently aired a controversial report about athletes doping, which included a suggestion that Denver Broncos quarterback Peyton Manning may have used human growth hormone, ESPN commentator and former Chicago Bears coach Mike Ditka called the channel “garbage” and “not a credible news organization.”

Asked Wednesday about shutdown, Manning said, “I’m sure it’s going to be just devestating to all of their viewers.”