Al Jazeera buys Current TV

 JournalismPakistan.com |  Published: 3 January 2013

Al Jazeera is set to acquire Current TV, boosting its presence in the U.S. market. The deal could be valued at $500 million, significantly increasing access to the broadcaster.

Summary

LOS ANGELES/NEW YORK: Al Jazeera said on Wednesday it will buy 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 United States.

Terms were undisclosed, but analysts estimated the deal could be worth as much as $500 million.

Al Jazeera said it would start a new US-based news channel with the acquisition, which will make it available in more than 40 million US households, up from 4.7 million prior to the deal.

The deal brings Al Jazeera, which operates under the patronage of the emir of Qatar and his family, into closer competition with American news channels like CNN, MSNBC and Fox.

But the award-winning channel that is seen in more than 260 million 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 60 million of the 100 million homes in the United States with cable or satellite service.

One of its distributors, Time Warner Cable, which accounted for about 12 million 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. - Reuters

KEY POINTS:

• Al Jazeera to acquire Current TV for an estimated $500 million.
• The move expands Al Jazeera's reach from 4.7 million to over 40 million households.
• Time Warner Cable terminates its agreement with Current TV amid low viewership.
• Current TV, founded by Al Gore, struggled with ratings prior to the deal.
• Al Jazeera faces challenges in competing with major U.S. news channels.