WASHINGTON, DC, January 3, 2013 — Al Gore – Nobel-prize winning eco-warrior, cable television entrepreneur, and enemy of fossil fuels – just took home an estimated $100 million from the sale of Current TV.
Gore, whose eco-friendly mansion can be seen from orbit and who atones for his enormous travel carbon footprint by planting trees, was concerned that his cable channel be sold to interests that reflect his own political views. He therefor rejected an offer last year from conservative media personality Glenn Beck and sold his channel to Al Jazeera.
Al Jazeera is the state-funded Arab news network headquartered in Qatar. It is thus an arm of the biggest of big oil, and famously provided the platform for Al Qaeda to broadcast its explanations for its 9-11 attacks on the Pentagon and the World Trade Center.
In addition to wanting a buyer who would reflect his political philosophy, Gore was anxious to fulfill his fiduciary responsibility to himself and keep his taxes low. A critic of the tax structure that allows the very wealthy, like former Massachusetts Governor Mitt Romney and billionaire tax activist Warren Buffet, to escape the high income tax rates paid by their secretaries, Gore attempted to complete the deal by December 31. Because the deal wasn’t signed until today, he and his partners will pay the new 23.8 percent capital gains tax rather than 15 percent, or an extra $8.8 million.
In his eagerness to create a news outlet more unrelentingly and purely liberal than MSNBC, Gore hired former MSNBC host Keith Olbermann at a salary widely believed to be in the neighborhood of $1,000 per viewer. Unwilling to share his set or help sell the programs of Current TV’s lesser talent, Olbermann tested the patience of even his biggest fan, and the relationship ended rancorously. The impact on Current TV viewership was indeterminate, the channel’s prime-time audience settling at about 42,000.
The interesting question, then, is why would Al Jazeera want to pay $500 million for a cable channel that no one watches?
In the odd economics of cable television, Current TV still earned an operating cash flow of over $16 million last year on gross revenues of about $108 million. Peter Kafka writes, “Congratulations, cable guys! You’re in a business that’s so valuable that even a failed network with partial distribution and no audience is worth some $500 million.”
Current audience and a modest cash flow aren’t what Al Jazeera bought, but rather the market penetration. While hardly any of them watch it, Current TV is carried to 60 million homes. It’s the potential to be viewed in those homes that makes Current TV a valuable property. Al Jazeera is currently restricted to viewers in the New York and Washington areas, and has been unable to find carriers willing to carry it to the rest of the United States. Al Gore has sold it that access, though cable operators may yet decide to exit their carriage deals and drop it.
Al Jazeera has no interest in keeping Eliot Spitzer’s show, or even of hiring back Keith Olbermann. It intends to rebrand the network, with a tentative name of “Al Jazeera America.” Sixty percent of its programming will be produced by Al Jazeera in the United States, while 40 percent will come from its global English-language unit, Al Jazeera English.
In his statement about the sale, Gore emphasized the shared philosophy of Al Jazeera and Current TV. He said that their joint mission is “to give voice to those who are not typically heard; to speak truth to power; to provide independent and diverse points of view; and to tell the stories that no one else is telling.”
They have yet to learn whether anyone will be listening.
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