Al Jazeera buys Gore’s Current TV
Purchase allows access to major pay-tv carriers
• Current TV, the network co-founded by former U.S. vice-president Al Gore, was sold for about $500 million to Al Jazeera, the Qatar-based cable-news channel, according to two people with knowledge of the deal.
The price tag represents an eightfold increase from the $60 million Gore and his partners paid in 2004 for the channel that became Current TV, said one of the people, who asked not to be named because the terms are private. Gore, chairman, and Joel Hyatt, co-founder and CEO, announced the sale without providing financial terms.
While the purchase gives Al Jazeera access to the biggest U.S. pay-TV carriers for the first time, it will have to improve on Current TV’s viewership to have staying power. Time Warner Cable Inc., the second-biggest U.S. cable carrier, is already dropping Current TV as part of a strategy to eliminate low-rated channels.
The network averaged about 42,000 prime-time viewers last quarter, according to Horizon Media Inc.
“It’s a pretty risky deal for them,” said Derek Baine, an SNL Kagan cable analyst in Monterey, California. The $500-million price “sounds high.”
While al Jazeera’s English network, started in 2006, reaches 250 million households in 130 countries, the U.S. represents only a small fraction of that audience. Al Jazeera said it will replace Current TV’s shows with its own this year, doubling its U.S. staff to 300, with headquarters in New York.
“Current Media was built based on a few key goals: to give voice to those who are not typically heard; to speak truth to power; to provide independent and diverse points of view; and to tell the stories that no one else is telling,” Gore and Hyatt said in the statement. “Al Jazeera, like Current, believes that facts and truth lead to a better understanding of the world around us.”
In the U.S., al Jazeera’s Englishlanguage network is carried on seven pay-TV providers, including small carriers such as Ohio’s Buckeye CableSystem and Vermont’s Burlington Telecom, according to its website. It reaches 4.7 million households, said Stan Collender, a spokesman for Al Jazeera with Qorvis Communications LLC.
Current TV will be available to about 40 million U.S. homes after Time Warner Cable stops airing the channel, Al Jazeera said.
It continues to be carried by Comcast Corp., DirecTV and Dish Network Corp., the three largest U.S. pay-TV operators.
That audience could be at risk for Al Jazeera if other carriers follow Time Warner Cable’s decision to stop carrying Current TV with the ownership change. A selection of Al Jazeera English programming is already available to New York residents on Time Warner Cable on the Rise network through a deal with Regional News Network.
“Our agreement with Current has been terminated and we will no longer be carrying the service,” Time Warner Cable, based in New York, said in an emailed statement. “We are removing the service as quickly as possible.”
Current TV’s average primetime audience in the fourth quarter of 2012 of 42,000 viewers compares with 896,000 for Time Warner Inc.’s CNN and 2.48 million for News Corp.’s Fox News, according to Brad Adgate, senior vice president of research at Horizon Media Inc.
Time Warner Cable, which provides 12.3 million households with cable TV, pays about 12 cents a month for each Current TV subscriber, or $17.7 million a year, according to the media research firm SNL Kagan.