Al Jazeera has struck a deal to purchase Current TV and launch a new U.S.-based news channel.
"For many years, we understood that we could make a positive contribution to the news and information available in and about the United States and what we are announcing today will help us achieve that goal," said Al Jazeera director general Ahmed bin Jassim Al Thani. "By acquiring Current TV, Al Jazeera will significantly expand our existing distribution footprint in the U.S., as well as increase our newsgathering and reporting efforts in America."
"We are proud and pleased that Al Jazeera, the award-winning international news organization, has bought Current TV," said Al Gore, co-founder and chairman, and Joel Hyatt, co-founder and CEO.
Current TV had a distribution footprint of 58 million households, but following news of the acquisition, Time Warner Cable said it would drop the network. TWC has positioned Current on digital basic, making it available to some 9 million homes.
"Our agreement with Current has been terminated and we will no longer be carrying the service," a TWC spokeswoman said. "We are removing the service as quickly as possible."
When a cable network is sold or changes its programming direction, distributors can revisit their deals.
A source confirmed it was because of the change in ownership. The nation's No. 2 cable operator has the right to carry Al Jazeera under another agreement, but it has no plans to do do, according to the source.
The sale, which was first reported Wednesday in the New York Times, will see Al Jazeera rebrand the network as a domestic and international news channel for American audiences in 2013, replacing Current's schedule of political shows after a transition period. The new network will be based in New York, with Al Jazeera looking to open new bureaus to supplement its existing news bureaus in New York, Washington, D.C., Los Angeles, Miami and Chicago. The company expects to its current U.S. based staff to 300 employees.
An acquisition of the low-rated Current TV was expected, with the network acknowledging it was considering a sale in October, saying then, "Current has been approached many times by media companies interested in acquiring our company. This year alone, we have had three inquiries. As a consequence, we thought it might be useful to engage expertise to help us evaluate our strategic options."
Given TWC's quick decision ,the sale could make Al Jazeera's new network available to around 50 million U.S. subscribers. Other providers that carry the low-rated Current could follow suit. SNL Kagan estimates Current TV’s monthly subscriber fee at 12 cents.
Its Al Jazeera English channel is currently only available on cable and satellite in select cities, including New York and Washington, D.C., despite Al Jazeera lobbying for greater carriage after the Arab Spring in 2011.
Founded in 2005, Current TV was rebranded as a political news channel in 2011 with the hire of Keith Olbermann, but his show failed to generate big ratings and he was fired from the network last spring. Subsequent shows hosted by Jennifer Granholm, Cenk Uygur and others have also failed to break out, with Current drawing about 42,000 viewers on an average night in 2012, according to Nielsen.