Thursday, July 31, 2008

The Station Vanishes

Hard to believe it's already been nine months since KLSD (1360AM) in San Diego ditched its successful liberal talk format to jump into the overcrowded sports radio shark tank. So far, the new format is a flop.

The San Diego Union-Tribune is the latest to take note of the woes of the new "XTRA Sports 1360." At least somebody is, since the station, since its format flip in November, has virtually dropped off the ratings map. They are almost a non-entity in the San Diego radio market.

And the biggest irony is that another Clear Channel-owned sports station, KLAC (570AM), located approximately 100 miles north in Los Angeles, does show up in the San Diego book. In other words, an out-of-market signal gets listeners, while the hometown station with the same format does not.

Let's crunch some numbers. In the Winter 2008 Arbitron book, the first full survey since KLSD ditched liberal talk, the station, which averaged a 1.5 share of the overall listening audience over the past year, has dropped off the charts. Essentially, that's a 75-80 percent listener drop. KLAC, which carried the Los Angeles Lakers and their deep playoff run, got enough listeners to account for a half share of the overall listening audience. Still, when local listeners would rather tune in an out-of-town sister station, that's got to be a sign of something bad.

In addition, at a time when Clear Channel is wiping out as much overhead as they possibly can, the new XTRA Sports 1360 is a more expensive operation than KLSD's liberal talk lineup was. The daytime roster currently consists of live and local talent - a much more expensive proposition than merely slotting in bartered syndicated programming like Air America or Ed Schultz (with a couple local talkers like Stacy Taylor and Jon Elliott). Therefore, Clear Channel is paying more money for fewer listeners. Is that something new they teach in business school?
The Union-Tribune column quotes one radio veteran, who calls the results of the bungled format flip unprecedented. He says people in the industry will be doing case studies for a long time:

“I don't care what the format is, I have never seen a station disappear that fast. Never,” said Ron Bain, a radio producer and former radio/TV executive who lives in North County. “And the few times that I've seen a station go down (like this), it will tend to go down slowly. . . . This is precedent-setting, that it just ended. It's like it went off the air – and one could say they have.”

Meanwhile, Clear Channel is looking for the silver lining:

Bob Bolinger, vice president and market manager for Clear Channel Radio-San Diego, was on vacation the past two days. Brian Wilson, XTRA's program director, admitted frustration but said the station had its best month thus far in June. Of course, that came immediately after its worst month. “We made some progress in some day parts,” Wilson said. “ . . . I feel we do pretty good radio, and with football season coming up and some more marketing, I feel we're ready to turn the corner.”

The top sports talker in the market, XEPRS (1190AM), a.k.a. XX Sports, doesn't seem too concerned about its upstart rival, even though Clear Channel carried out a talent raid of the station, more recently snatching program director Bill Pugh. XX Sports did lose half a share, but that could be attributed to the recent split of the FM simulcast signal to launch an oldies format, which experienced a modestly successful debut in its first partial book.

Now, playing the devil's advocate here, I should be fair and offer a few points in defense of Clear Channel and the new KLSD. First, any kind of talk format, whether it be sports, 'hot talk,' liberal or even conservative, is a long-term proposition. Most stations like these are often slow-starters, and take a long time to generate an audience. In some cases, it may take years to see any kind of ratings success. It's the argument that I've often used for liberal talkers, but it is entirely true for most any kind of format, especially talk.

Second, KLSD's current moniker, XTRA Sports 1360, has been used by a number of Clear Channel stations in Southern California over the years. Originally, it was simulcast on Tijuana-based XETRA (690AM) and KXTA (1150AM) in Los Angeles. In January 2005, the original XTRA Sports simulcast was broken up, with the American programming rights of XETRA spun off to another group (which later changed the call letters) and the format moved to the stronger 570AM frequency in Los Angeles, with 1150AM becoming the current progressive talker KTLK. The XTRA name was eventually dropped by KLAC, but picked up by KLSD. Now, in its longtime but flawed methods of collecting data, Arbitron does keep track of station nicknames, in addition to call letters and frequencies. So, in Los Angeles, for example, a diary response that merely cites "KISS-FM" is actually read as KIIS (102.7FM), since that station has registered the nickname with Arbitron. In the case of KLAC, Arbitron considers it part of the San Diego market, since the station's signal does reach there. Even though they no longer use the XTRA moniker, a diary entry that says "XTRA" could still possibly be credited to KLAC. The fact that the moniker has been used on four Southern California signals over the past four years further complicates the issue. Now, I'm not sure how Arbitron compiled all of their information, but with all the confusion here, it is a slight possibility. Still, that would realistically only account for a small portion of the ratings share, so either way, the new KLSD is still a dog.

Finally, most programmers of sports formats claim that ratings mean virtually nothing. Sports talk targets a very specific segment of the audience, namely male sports junkies. With such a narrow demographic, it is an easy sell to advertisers who wish to target this audience alone (mostly sports bars, strip clubs, car dealerships, online gambling, ticket dealers, etc.). Therefore, the conventional wisdom goes, sponsors will pay more to hawk their wares directly to the consumers they want. Whether this is entirely correct, or whether most of the sports radio market will collapse once advertisers come to their senses in regard to advertising on stations with no listeners, remains to be seen.

But let's be real here. The new KLSD is closer to the ill-fated New Coke than an outright success. The tinkered with a successful formula and pissed off more listeners and advertisers than they satisfied. With liberal talk, the station got the best ratings (in more desirable demographics) it had received in years. Not many 1,000 watt AM stations in large markets can boast over a two share with a healthy portfolio of happy advertisers and ridiculously low overhead. Now that's all out the window, as KLSD currently scrapes the bottom of the also-ran sports stations in Southern California.

This seems to be a continuing pattern. Clear Channel stations in Cincinnati, Columbus, Akron and other places have fizzled since dropping progressive talk. And stations owned by other groups in other markets have had similar outcomes since ditching the format.

Add to that list San Diego, where the new KLSD has been a miserable failure.


FSL said...

Very thorough analysis.

Bottom line: No former progressive talk station has done better. Most have done worse (some much worse).

The people who run broadcasting are short-sighted, small-minded, usually nasty babbits. They accept as gospel that progressive talk can not work, and they won't let any factual evidence to the contrary cloud their "expertise."

NYLefty said...

Of course the 12+ ratings are virtually meaningless. I suspect that at least some of the former progressive talk stations that are now running sports are billing better, and that's the all-important bottom line factor.

Bob Kincaid said...

A very solid analysis of an underreported phenomeonon.

If I may, I'd like to offer an addendum: while it may seem a restatement of the obvious, this is a direct result of the outsourcing of local licensure to corporate media ownership.

What do I mean? Consider: a locally owned station has to be programmed in such a way as to maximize its profitability. If one owns, say, four stations in a market, one needs all four to remain viable. If however, one is a Clear Channel, one may balance the overall corporate profit and loss sheet by using stations that lose money in one market to balance against big profits for a blowtorch in another city hundreds of miles away.

This is why Clear Channel actually reaps a reward from deliberately harming its own revenue and listener bases in some cities.

In turn, this phenomenon is also bad for the local economy, since distantly-owned stations tend to employee fewer people. Radio talent is made, not born. Before there can be a major market "star," that star usually has to pay his/her dues in small market radio, perhaps even starting out as a pimply-faced teenager opting for a minimum wage radio job over a minimum wage McD's job. It's happened more than once, I'd wager.

Again, though, nice analysis. You point toward the necessity of media license divestiture and do it cogently and thoroughly.

On an entirely separate topic, you might enjoy our parody of Savage's autism rant. It's here:

FSL said...


I do understand that group owners see their stations in a given market as part of a cluster. They sell the cluster as a package to advertisers. If the package is light on males in the money demos, they might consider sports talk on one station to beef up the package. Liberal talk and right wing talk deliver similar audience demos so a liberal talk station might be seen as not adding to the audience mix.

You seem to be saying though that a mega owner would want to lose money in one market because they are raking it in another market. That doesn't make sense. No "tax write-off" can make up for losing money (just like, as Dave Ramsey keeps telling us, a tax deduction does not make up for paying mortgage interest). On top of that, market managers rise and fall on their ability to deliver revenue and profits in their own markets. Are you saying a mega owner will ask the market manager in East Armpit (or where ever) to "take one for the team?"

Managers may act on their own programming preferences (like the Grim Reaper). They may make dumb decisions. Some individual owners may run "hobby stations." But corporate managers setting out to lose money is unheard of and makes no sense.

Bob Kincaid said...


It makes an abundance of sense in an economy of scale, at least to the bean-counting types I've talked to.

The corporate game is to reduce the effective rate of taxation. That only happens through manipulation of profit and loss. If one has a handful of HUGELY successful 50KW blowtorches raking it in hand-over-fist, the surest way to reduce the effective overall tax liability is to have losses to balance against the gains. Thus, Clear Channel's revenues for, say, WLW Cincy are balanced against an aggregated handful of losses from a variety of other markets, especially if the signal's not so great in those other stations.

I've seen it happen on a smaller scale, watching a couple of small market stations be used as a money-suck against the owner's larger, far more successful retail business.

Given the utter incomprehensible nature of the San Diego situation as evinced in the OP and the degree of amazement it occasioned, one is tempted to apply the old Sherlock Holmes dictum that, once one has elminated the impossible, whatever is left, however improbable, is the answer.

In this case, is it impossible that Clear Channel would seek to reduce its tax liability for highly profitable stations by tanking the earning potential of less profitable, lower-powered ones?

Finally, liberal vs. con talk delivers a similar raw demographic, but not an identical one. The same crowd isn't listening to Limbaugh as might listen to say, Randi or Ed. As such, having the progressive talk going in a cluster makes more sense than entering a glutted market for another format.

FSL said...

Bean counters must use a different kind of logic. What doth it profit a man to lose $1.00 in revenue and save 30 cents in taxes? Well maybe not so different from people who don't want to pay off a mortgage so they can keep the tax deduction.

Excepting a few advertisers who refuse to allow their spots to be placed on liberal talk stations, liberal and wing-nut talkers seem to be running spots for mostly the same bottom-feeder advertisers.

Bob Kincaid said...

It is true that there are the same ubiquitous "BUY GOLD NOW" spots on liberal as on conservative talk. The question, however, is which group is more likely to fall for the dodge.

It would be interesting to see a breakdown of the per-inquiry ad revenue generations between two similarly performing talk stations, one liberal and one conservative. My hypothesis? More conservatives are willing to shell out the bucks for herbal baldness cures, vaccuum cleaners that pick up bowling balls and swedish foam mattresses than are liberal listeners. The conservative mindset is predicated that one can, indeed, get something for nothing. If true, the per-inquiry ads would be more valuable on conservative radio.

FSL said...


You have a point. When I hear some of the spots running on progressive talk radio my first thought is I hate to think that progressives would fall for that line of ___.

Then again, I am reminded that "left wing world" (paraphrasing Steph) is a big tent and includes (as we were reminded during the recent primary season) brie and chablis elite progressives, beer truck - union Democrats, and various ethnic/racial activist groups. I haven't seen any audience research on this (and I'd love to) but I suspect lib-talk listeners are more likely beer truck Democrats than elite progressives. And beer truck Democrats might really buy the line of ___ being dished out in those PI spots.

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