Current TV Sold To Al Jazeera; $500 Million Deal For Al Gore and Co. [UPDATED]
This article is more than 8 years old.
It looks as if Current TV will soon be a thing of the past. Al Jazeera, the Doha, Qatar
-based news broadcaster, has agreed to acquire the seven-year-old cable channel from its co-founders, Al Gore and Joel Hyatt.
“When considering the several suitors who were interested in acquiring Current, it became clear to us that Al Jazeera was founded with the same goals we had for Current,” Hyatt wrote. “Al Jazeera, like Current, believes that facts and truth lead to a better understanding of the world around us.”
Al Jazeera plans to scrap Current’s programming lineup and brand, which never caught on with a critical mass of viewers, and use the channel’s subscriber base of 60 million households as the basis for a new network. A Current spokeswoman had no immediate comment on the reports.
Details of the sale price haven’t leaked out yet. An estimate provided by the research firm SNL Kagan to my colleagues Dorothy Pomerantz
and Ryan Mac
last year pegged Current’s valuation at approximately $500 million based on its annual revenues of around $100 million, more than 80% of which derive from its monthly subscription fee of 12 cents per household.
But the sale will diminish the network’s value considerably. According to Hyatt’s memo, Time Warner Cable
did not consent to the deal and will drop Current from its menu going forward. TWC’s 12 million
9 million households represent 20%
15% of Current’s total reach.
Still, even a $400 million price tag might mean a windfall of as much as $100 million for Current co-founder Al Gore, who owned about 25% of the company’s shares at the time of its founding in 2005, according to financial documents filed in 2008 during the run-up to an initial public offering. [Update: As my colleague Ryan Mac reports
, the sale price was indeed around $500 million, meaning Gore's stake of 20% (not 25%) was worth $100 million.] (The IPO was aborted in 2009.) Gore’s partner, Current vice chairman Joel Hyatt, held a similar initial stake, although it’s likely both men’s holdings have been diluted somewhat since then.
While 60 million households is respectable distribution for a second-tier cable network, Current has long suffered from poor channel placement, low visibility and a diffuse brand identity. In a bid to boost its ratings and ad revenues, Gore and Hyatt hired veteran newscaster Keith Olbermann to be Current’s tentpole anchor and chief news officer in 2011, shortly after he left MSNBC. That didn’t work out
Olbermann’s history of clashing with employers repeated itself yet again, with the star and the network fighting over editorial control and resources. Olbermann, who was drawing a reported $10 million salary at Current, is now pursuing a lawsuit against the company while actively looking for a new job
[Note: The original version of this post was published minutes before Hyatt's announcement. I've updated it throughout to reflect the new information. I also corrected the number of Time Warner Cable households that were receiving Current. While TWC has more than 12 million homes, not all of them were getting Current. Thanks to Ryan Mac for help putting this together.]
Here’s Hyatt’s full memo.
Al and I are thrilled and proud to announce that a few moments ago Current was acquired by Al Jazeera, the award winning international news organization.
When considering the several suitors who were interested in acquiring Current, it became clear to us that Al Jazeera was founded with the same goals we had for Current: To give voice to those whose voices are not typically heard; to speak truth to power; to provide independent and diverse points of view; and to tell the important stories that no one else is telling. Al Jazeera, like Current, believes that facts and truth lead to a better understanding of the world around us.Al and I did significant due diligence as part of our evaluation process. We were impressed with all that we learned about Al Jazeera and its journalistic integrity, global reach, award-winning programming, and growing influence around the world. That influence has recently been demonstrated by Al Jazeera’s important and impactful coverage of the Arab Spring, which was widely credited as being the most thorough and informative coverage from any media company. Colin Powell told Al that Al Jazeera is the only cable news network he watches (which he is able to do because Comcast carries it in the Washington, DC market).
As you may know, Al Jazeera is funded by the government of Qatar, which is the United States’ closest ally in the Gulf Region, and is where the United States bases its Middle East Air Force operations. I have had first-hand knowledge of Qatar’s policies as a result of my tenure on the Board of The Brookings Institution. The Saban Center for Middle East Policy is a joint venture of The Brookings Institution and Qatar, and it has offices in Washington, DC and Doha, Qatar. Its purpose is to propose practical public policies that can contribute to peace in the Middle East, and its founding Director is my friend, Martin Indyk, the former U.S. Ambassador to Israel.
While considering this decision, I spent a week in Doha, Qatar, where Al Jazeera is headquartered, and I am pleased to tell you that I could not have been more impressed with their operation. First of all, they are bringing large-scale resources to journalism – something which we have not been able to do. Al Jazeera has more than 80 bureaus around the world, and is seen in more than 260 million homes in 130 countries. Al Jazeera has a staff of over 4000 people, including 400 journalists. Its journalists hail from more than 50 countries, with every conceivable nationality and religion represented on its professional team. Al Jazeera is a major global media player.
The rest of the world thinks so too. Al Jazeera English has won many, many awards including an Alfred I DuPont Award for Best Documentary, the Franklin Delano Roosevelt Four Freedoms Awards for freedom of speech and expression, an Amnesty International Award for International TV and Radio, the prestigious Peabody Award, and the Huffington Post Ultimate Media Gamechanger award.All of this is compelling, but what really convinced Al and me that Al Jazeera would be a great home for the people of Current was their publicly stated Values and Core Capabilities. Their mission includes the following: Diversity (“bringing stories from the underreported communities, societies and cultures from across the globe), Journalistic Integrity (“committed to the uncompromising pursuit of truth and the ideals of journalism”), and A Voice for the Voiceless (“promoting the basic human right of the freedom of expression for people everywhere”).
Al Jazeera is planning to invest significantly in building “Al Jazeera America,” a network focused on international news for the American audience. Al and I will both serve on the Advisory Board of Al Jazeera America, and we look forward to helping build an important news network.
Obviously there will be a lot of transition work in the coming weeks. Al Jazeera does not have a management team in place in the U.S to run this new venture. They are extremely impressed with our people and our accomplishments. I will be holding staff meetings in the next few days and will introduce the senior folks from Al Jazeera who have led the planning for this entry into the United States. (I will separately communicate as to the day and time for those staff meetings.) We will communicate more of the details of this acquisition during those meetings.
Getting this transaction done was very difficult. One of Current’s distributors, Time Warner Cable, did not consent to the sale to Al Jazeera. Consequently, Current will no longer be carried on TWC. This is unfortunate, but I am confident that Al Jazeera America will earn significant additional carriage in the months and years ahead. In the United Kingdom, it has become the number three news network (behind the BBC and Sky News). It did that by investing in great programming – as it intends to do in the United States.Al and I are incredibly proud of what all of us have been able to accomplish together. Throughout our short history, Current has been a thought leader for the media industry, innovating many exciting features that became standard after we introduced them. (Tweets on television anyone?!) Just this past year, we’ve been able to provide our viewers with fantastic interactive and social TV 2.0 coverage of the Presidential Election, including a peek inside the Obama Campaign headquarters, in depth analysis of the Libor Scandal, the breaking and relentless coverage of the Trayvon Martin scandal, and the list goes on and on. We have won most of the important awards in the journalism profession. We have stayed true to our independence and courage. And in our choice of new corporate parent, we are continuing to strive to make a difference – to provide the American people with information and analysis they need to live better, more secure, happier lives. I am confident this will continue into the future.
As I reflected deeply about this decision – both to sell the company and to whom – I kept coming back to one basic notion: The purpose of journalism is to provide those who don’t know with information and knowledge so that they can become those who do know. Bias and hatred are fueled by ignorance. Information and knowledge are the only antidotes to that ignorance. That is the role journalism must play – to provide the knowledge that sweeps away the bias and hatred caused by ignorance. It is a noble pursuit. I am proud of each and every one of you for your dedication to pursuing that noble goal. And it is a privilege to have worked with all of you these past few years.
Please accept my best wishes for a happy, healthy, exciting and fulfilling New Year!
All the best,
I've been covering the business of news, information and entertainment in one form or another for more than 10 years. In February 2014, I moved to San Francisco to cover…Read More
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