Al Jazeera America, the cable television news outlet controlled by Qatar's royal family, is shutting down less than three years after its high-profile launch, the network said on Wednesday.
The U.S. cable network will cease operations by April 30, the network said, citing economic challenges in the American media market.
As of last summer, the network had about 800 employees, according to one former employee who asked to remain anonymous. The company declined to comment on how many employees would lose their jobs.
Al Jazeera, which is owned by Qatar-based Al Jazeera Media Network, had been trying for years to break into the U.S. cable market when it bought Current TV, a U.S.-based television network owned by former U.S. Vice President Al Gore and his business partner Joel Hyatt, for $500 million in 2013.
The network hired some well-known television journalists, including Soledad O'Brien and Ali Velshi from CNN, and generally has been given high marks from journalism experts for its coverage. Yet, with its Arabic name and Qatari pedigree, the network continued to struggle to find a place in the U.S. media landscape.
"Al Jazeera America entered a crowded marketplace with a brand that had a lot of baggage," said Merrill Brown, director of the School of Communications and Media at Montclair State University. "I don't know that they could have done anything programatically to overcome those challenges."
While Qatar has been hit hard by declining oil prices, a spokeswoman for Al Jazeera America said the move to shut down the network was unrelated to oil.
"The Al Jazeera America Board made this decision based on the fact that the Al Jazeera America business model is simply not sustainable in light of the economic challenges in the U.S. media marketplace," the spokeswoman wrote in an email.
The company said it will expand its existing international digital services in the United States, as consumers ditch traditional media and move to mobile devices such as smartphones and tablets for news.
Al Jazeera did not get the instant access to U.S. homes it was hoping for when it bought Current TV. Time Warner Cable Inc (TWC.N) and AT&T Inc (T.N) argued that they had contracted with Current TV, not Al Jazeera, and therefore were not obligated to carry the network.
DirecTV, which AT&T acquired last year, sued Al Jazeera America over its carriage agreement and ended up settling in the fall. Time Warner also ended up carrying the network after initial pushback.
Other major cable providers, including Charter Communications Inc (CHTR.O), Cablevision Systems Corp (CVC.N) and Cox Communications Inc, do not carry the network.
Al Jazeera America also struggled with morale problems and high turnover as well as a wrongful termination lawsuit from a former employee, Matthew Luke, accusing news editor Osman Mahmud as being anti-Semitic and sexist.
In May, the network announced it was replacing Chief Executive Officer Ehab Al Shihabi with Al Anstey, who was previously managing director of Al Jazeera English.
Ultimately, Al Jazeera America reached some 60 million American households, according to Nielsen data. But only 28,000 viewers watched the network daily in prime-time last year.
(Additional reporting by Anya George Tharakan in Bengaluru; Editing by Eric Effron, Jonathan Oatis and Lisa Shumaker)
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Published Date: Jan 14, 2016 05:15 AM | Updated Date: Jan 14, 2016 05:15 AM