Agencies/Los Angeles/New York


Al Jazeera said late Wednesday it has bought Current TV, the struggling cable channel founded by Al Gore and partners, in a move that will boost the Qatar-based broadcaster’s footprint in the US.
Terms were undisclosed, but analysts estimated the deal could be worth as much as $500mn.
Al Jazeera said it would start a new US-based news channel with the acquisition, which will make it available in more than 40mn US households, up from 4.7mn prior to the deal.
The deal brings Al Jazeera into closer competition with American news channels like CNN, MSNBC and Fox.
But the award-winning channel that is seen in more than 260mn homes in 130 countries faces hurdles with US distributors and viewers, television industry analysts said.
Current, a liberal channel which has battled low viewership, had been distributed in about 60mn of the 100mn homes in the US with cable or satellite service.
One of its distributors, Time Warner Cable, which accounted for about 12mn of those homes, announced late Wednesday it was terminating its carriage deal.
“Our agreement with Current has been terminated and we will no longer be carrying the service. We are removing the service as quickly as possible,” Time Warner Cable said in a statement.
Reuters reported in April Time Warner Cable was considering dropping Current if it did not reach certain ratings thresholds.
A spokesperson would not elaborate. Current is also distributed by Comcast Corp and DirecTV, with 22.4mn and 19.8mn subscribers, respectively.
Comcast or DirecTV were either unavailable or declined comment. Dish Network Corp also declined comment.
Both Comcast and DirecTV also hold equity stakes of more than 5% in Current, according to public filings.
Current said Gore, its chairman, and co-founder Joel Hyatt, the chief executive officer, will remain on the advisory board.
Al Jazeera has only been shown in a handful of cities. It said its new US-based news channel would be separate from Al Jazeera English, and would provide both domestic and international news for American audiences.
The new channel would air in 2013 and would be headquartered in New York City. In addition to existing bureaus in New York, Washington DC, Los Angeles, Miami and Chicago, Al Jazeera would open more bureaus and would double its US-based staff to more than 300 employees.
“We are proud and pleased that Al Jazeera, the award-winning international news organisation, has bought Current TV,” said Gore and Hyatt in a statement.
Al Jazeera, in a separate statement, said its new channel would be based in New York and will provide both domestic and foreign news for American viewers when it is launched this year, and increase its existing US staffing levels to more than 300.
“By acquiring Current TV, Al Jazeera will significantly expand our existing distribution footprint in the US, as well as increase our newsgathering and reporting,” said Al Jazeera Director General Ahmed bin Jassim al-Thani.
Al Jazeera’s decision to create a US-based news channel was based in part on the fact that Americans have already shown a great demand for its news and programmes, the company said.
“Almost 40% of all online viewing of Al Jazeera English comes from the US,” it added in the statement.
The New York Times reported that Al Jazeera was expected to name the new channel “Al-Jazeera America,” instead of using its existing English-language vehicle Al Jazeera English, capitalising on Current’s US audience reach.
Current Media, founded in 2005, operates Current TV, and reaches households in Britain, as well as the US. It also operates a youth-focused website Current.com, where users can submit their own
content.
The channel has won two Emmy Awards and other honours. It reaches 71mn households worldwide.
But The Times said a sale was considered because of low ratings, with an average of just 42,000 people watching Current TV last year.
In late October, Current confirmed it was considering selling itself and had hired JP Morgan and the Raine Group to assess options.
Thompson said the deal came at a challenging time for the cable industry.
“Launching a cable network in the US in the second decade of the 21st century is not an easy thing to do. Even Oprah Winfrey has struggled in significant ways,” he said.
Disputes between pay TV distributors and cable networks have risen lately. Time Warner Cable also dropped arts-focused cable channel Ovation over its low ratings and the high costs of carrying the network.