Coverage: Al Jazeera America shuts down

Al Jazeera America announced Wednesday that it will close by the end of April, saying its business model was “no longer sustainable.”

Josh Koblin of The New York Times had the day’s surprising news:

The cable news channel Al Jazeera America, which debuted in 2013 to great fanfare when it promised to cover American news soberly and seriously, will be shutting down by the end of April. The move was announced at a companywide meeting on Wednesday.

In a memo to the staff, Al Jazeera America’s chief executive, Al Anstey, said the “decision by Al Jazeera America’s board is driven by the fact that our business model is simply not sustainable in light of the economic challenges in the U.S. media marketplace.”

“I know the closure of AJAM will be a massive disappointment for everyone here who has worked tirelessly for our long-term future,” he continued, using the company acronym. “The decision that has been made is in no way because AJAM has done anything but a great job. Our commitment to great journalism is unrivaled.”

At the companywide meeting, Al Jazeera America staff members, some in tears, were told that the decision to shutter the network had not been unanimous. Some of the channel’s leadership argued that the network provided an important service, and continued to win awards for its coverage. But in the end, the decision was an economic one. The channel, it was felt, had fallen victim to the lack of a business model beyond continuous support from Qatar, the energy-rich country that owns Al Jazeera.

Some staffers saw that as a tacit admission that falling oil prices were behind the closure, though a spokeswoman for the company denied that on Wednesday.

David Schepp of Moneywatch described how oil prices played a role in the agencies untimely American demise:

Back in July 2013, a barrel of oil was selling for around $98 in the U.S. when the Qatar-backed Al Jazeera announced with huge ambitions the launch of a cable channel in America that would rival CNN and Fox News.

Less than three years later, with oil selling for $30 a barrel on U.S. markets, the owners pulled the plug on Al Jazeera America, citing a business model that was “simply not sustainable.” One knowledgeable observer estimated the total loss at nearly $2 billion.

In a memo to employees Wednesday, the network said it was shutting down by the end of April.

Al Jazeera America debuted in August 2013 to much fanfare, promising to deliver quality, in-depth content as an alternative to the shouting heads featured prominently on other cable news channels.

Backed by the riches of the Qatar government, Al Jazeera America gained its foothold in the competitive U.S. media market through the $500 million purchase of Current TV, the struggling cable news network founded by Al Gore.

Tom Lludt and Brian Stelter of CNN Money explained how the station faced legal troubles in recent months:

But from the beginning, Al Jazeera America has been beset by lousy ratings and internal strife. Two former employees filed lawsuits last year against the company with charges of anti-Semitism and sexism in the newsroom.

Al Shihabi, who was named as a defendant in one of the lawsuits, was ousted in May and replaced by Anstey, who had previously served as managing director of Al Jazeera English.

Wednesday’s announcement comes just weeks after Al Jazeera America broadcast a provocative documentary about sports doping that linked Peyton Manning’s wife to shipments of human growth hormone. Manning denied some of the claims and two other athletes named in the documentary filed lawsuits against the channel.

There is no link between the controversy and the channel’s closure, however. The investigative unit that produced the doping documentary will remain in operation.