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Emerging Nets Make Case for Filling a Void

As Al Jazeera America exits, new news voices pitch their relevance to viewers 3/28/2016 8:00 AM Eastern
The shuttering of Al Jazeera America in April will leave a hard-to-fill void in independent cable news.
TakeAway

The Al Jazeera America shutdown highlights the difficulties emerging news networks face to get traction in a challenging distribution climate.

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When Al Jazeera America officially closes its doors April 12, it will leave a void among emerging cable news network voices that will be difficult to fill, industry observers said.

 

The three-year-old network, which this past February announced it would close down after unsuccessfully attempting to compete with cable’s upper echelon of news networks in Fox News Channel, CNN and MSNBC, will most likely not be replaced on most cable and satellite lineups with other emerging networks such as TheBlaze, Fusion, Newsmax TV or One America News Network, even as the 2016 political campaign heats up and drives news-network ratings.

 

ELECTION-YEAR RELEVANCE

Those emerging cable-news networks say the loss of Al Jazeera America does not signal a diminishing value for alternative voices beyond the big three cable news networks. Rather, it’s a realization that in a crowded, evolving pay TV marketplace, television news, like politics, is a di_ cult arena in which to rack up wins.

 

“There’s no doubt there’s an opportunity, and the live component of news in general preserves the linear platforms and makes them relevant,” said Charles Herring, president of Herring Networks, which owns conservative-leaning One America News. “MVPDs are always looking for live content, whether it’s news or sports, and a lot of the viewers tune to the linear offering to watch breaking news — that’s where the latest source of information is.”

 

Al Jazeera America, which debuted in 2013 after the Qatar-based Al Jazeera Media purchased the former Current TV network from former Vice President Al Gore and other investors for $500 million, will sign off with more than 60 million subscribers across numerous pay TV affiliates, including Comcast, Time Warner Cable, DirecTV, Dish Network and Verizon Communications’s Fios TV.

 

Several potential suitors, including Herring, have looked at purchasing Al Jazeera America’s assets, as well as its affiliate agreements, but at press time no deals were thought to be imminent.

 

“We’ve taken a very good look at the opportunities around Al Jazeera closing,” Herring said, although he would not provide specifics.

 

With distributors looking to pare down channel lineups amid rising programming costs and a loss of subscribers turning to less-expensive streaming services, industry executives say its unlikely any cable network will replace Al Jazeera America on distributor lineups.

 

“What we have found is the distributors are not saying to themselves, ‘Oh, we lost Al Jazeera and we need to fill that hole,’” Newsmax Media CEO Christopher Ruddy said. “I think there’s a lot of anxiety on the operator side of the business where they are not looking for new channels, and Al Jazeera was pushed on them because of existing deals.”

 

Indeed, Comcast and another major distributor confirmed to Multichannel News that they don’t plan to fill Al Jazeera America’s channel slot with a new or existing programmer.

 

Al Jazeera America’s demise comes as the unpredictable and contentious 2016 presidential campaign is driving big ratings for cable news networks. Fox News has won the lion’s share of weekly cable primetime ratings races so far this year, and is primed to finish the first quarter as the most-watched cable network in primetime.

 

CNN and MSNBC are also posting significant viewership upticks in ratings during the first quarter of 2016.

 

While both Herring and Ruddy lamented the loss of Al Jazeera America’s voice in the cable news landscape, they both said that there remains a need for independent news outlets that provide viewers with alternative voices to the big cable news networks.

 

“I’m always disappointed when a news channel disappears because I believe there is strength in diversity,” said Ruddy. “The other channels are much more polarizing, and the public would like a more informational-based channel.”

 

Added Herring: “We’re having the most interesting election taking place right now, and I do not recall another election that was important, entertaining and thought provoking. … I haven’t come across a single individual that doesn’t have a strong opinion on the candidates. It’s an important part of our democracy to ensure that all this information gets out to the viewers so that they can make an informed decision regardless of where one might fall.”

 

In an effort to assure its voice is heard, Herring earlier this month filed suit against AT&T, saying the company is reneging on a promise to carry its One America News and AWE networks on DirecTV. In a statement AT&T claimed the lawsuit to be “baseless,” adding that it has offered to carry both channels on DirecTV at reasonable, market-based terms.”

 

Herring said the networks would only cost 6 cents per channel, per month, which equates to 72 cents per year. “Although DirecTV will always take the position that the rates being requested are out of line and not fair and not what the market demanded, it’s not a fact,” he said.

 

STILL REACHING OUT

Newsmax’s Ruddy said the network will continue to secure distribution deals with multichannel distributors despite the difficult marketplace. He said Newsmax isn’t banking on benefitting from Al Jazeera’s demise, and said the 46 million-subscriber network actually had greater reach than Al Jazeera America with several distributors, including DirecTV.

 

“We looked at Al Jazeera, and the problem is that there is not a lot of interest by Al Jazeera to transfer agreements, and there’s not a lot of interest among the operators to fill those holes with channels just for the sake of filling them,” he said. “Newsmax has never seen itself as having to depend on one network or another failing — we’ve always been competing with ourselves to build a better product and a bigger audience.”

 

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