Current TV Files For IPO With SEC

MediaPost reports:

IN A MOVE SURE TO cause some heads to shake, Current TV--the network
widely identified with founder Al Gore--filed for an IPO with the SEC
on Monday. The move comes despite an overall downturn in media stocks,
an uncertain future for independent cable networks and some $32
million in losses since 2005.

The company, which operates the Current TV network and associated Web
site, said it would be known as Current Media, and plans to continue
building a global media company targeting 18- to-34-year-olds with
news and lifestyle content. The network is in some 51 million homes,
including distribution in the UK and Ireland. It has a deal to launch
in Italy this spring.

Revenue in 2007 was $63.8 million, up from $37.9 million in 2006. Net
losses increased from $7.6 million to $9.9 million. (Expenses,
including an additional $9 million-plus for programming, also went up
considerably.)

The company has lost some $31.8 million since 2005 when the Current
network went live. The IPO filing comes as share prices in media
companies have been dropping precipitously, as fears of a recession
and its ripple effect on the ad market rise. Also, the fate of
independent cable networks appears to be up in the air, with
conglomerates that control a portfolio of networks benefiting from
that heft in negotiations with both affiliates and advertisers. NBC
Universal recently acquired the Oxygen network, while the Hallmark
Channel has sought a buyer for some time.

Last year, some 84% of Current TV's revenues came from affiliate fees,
although the company said in its SEC filing that "over the longer term
the majority of our revenue growth will be derived from advertising."

Ad revenues were some $10 million in 2007, up about 25% over the year
before. The company, which has former Turner and Weather Channel
executive Liz Janneman heading sales, indicated that it will look to
build its sales staff.

Gore and co-founder, former Ohio Democratic Senatorial candidate Joel
Hyatt, will control all the Class B shares of Current Media--which
come with enhanced voting power --once the company goes public on the
NASDAQ, as planned.

In order to build its ad base until now, the company has made what
appears to be a series of category-exclusive deals with certain
marketers--"agreements with some advertisers that effectively prevent
us from selling advertising to their competitors"--according to the
filing. Toyota, Johnson & Johnson and General Electric are prominent
advertisers. The network does not yet subscribe to Nielsen ratings,
though says it plans to.

Since 2006 when Sony launched a campaign, Current has offered
marketers the opportunity to run user-generated ads--what it calls
"VCAMS," for "viewer created ad messages." About a third of Current's
programming comes from viewers, and the network seeks shorter-form
content that runs in two- to 10-minute blocks.

"Leveraging this programming platform, we have pioneered innovative
ways for blue-chip advertisers to reach and engage with our young
adult audience--an audience that is highly sought after and, we
believe, increasingly elusive in traditional media outlets," the
company wrote in the filing.

In retrospect, when it launched in 2005, Current was on the cutting
edge of the user-generated-content wave. But it arguably was soon
overtaken by the likes of YouTube.

Current, which had been in the planning stages since 2002, got its
toehold when it purchased cable network Newsworld International in
2004. That switched over to the Current network the next year in some
19 million homes.

Current's affiliate agreements, which give it distribution in some 51
million homes, are with a range of U.S. distributors, including
Comcast, DirecTV and AT&T. The company said those deals don't begin to
expire until three years down the road.