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Al Jazeera America closing: Casualty of US news climate or falling oil prices?

The American-offshoot of the Qatari-owned Al Jazeera Media Network will shut down less than three years after entering the US marketplace.

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Brendan McDermid/Reuters
A woman passes by the Al Jazeera America broadcast center in midtown Manhattan in New York City on Wednesday. Al Jazeera America, the cable television news outlet owned by Qatar-based Al Jazeera Media Network, is shutting down less than three years after its high-profile launch, the network said on Wednesday.

Less than three years after its inception, the Al Jazeera America cable news network will sign off for the last time on April 30. 

Some observers have questioned whether the demise of the US-based offshoot of the Qatari royal family's Al Jazeera Media Network could be tied to the declining oil prices, which have taken a toll on Qatar's economy. But a spokeswoman from Al Jazeera told Reuters that the decision stemmed from challenges relating to the US media market, which has struggled to find ways to recoup lost advertising in the new digital economy.

"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 to Reuters.

The network had hoped the $500 million deal to buy Current TV in 2013 would come with the contracts the American network had with cable providers intact, allowing immediate entrance into mainstream American cable news. However, soon after Al Jazeera America acquired Current TV, Time Warner Cable Inc and AT&T declined to carry the network.

Time Warner eventually carried the network, but DirecTV, which is owned by AT&T, sued Al Jazeera America over its agreement and settled out of court.

Other major cable providers likewise declined to carry the network.   

"I'm not sure it was inevitable, but it's certainly not surprising," said Philip Seib, a University of Southern California journalism professor and author of the book "The Al Jazeera Effect," in an interview with Reuters. ''In the news environment today there is so much competition that it is virtually impossible for a new company to get any traction."

As Al Jazeera America shuts down, Al Jazeera will expand international digital news operations, with an eye toward making the service more widely accessible and available in the US, the company told the Associated Press.

"Al Jazeera America entered a crowded marketplace with a brand that had a lot of baggage," Merrill Brown, director of the School of Communications and Media at Montclair State University, told the AP. "I don't know that they could have done anything programmatically to overcome those challenges."

Last month, Al Jazeera America was awarded the Alfred I. DuPont-Columbia University journalism award for a documentary about working class Americans.

This report includes material from the Associated Press and Reuters.

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