1-Man’s Opinion on Sports–Friday “Death of Mighty 1090–Blood on Their Hands”

Posted by on May 3rd, 2019  •  0 Comments  • 

-0-

“Death of Mighty 1090-Blood On Their Hands”

-0-

I punched up the two all sports stations I worked at, helped pioneer, helped build, had great success at.

690 was programming Chinese Mandarin shows on that 77,000-blowtorch signal yesterday.

1090 was into Mexican music and Spanish talkshows on their 50,000-watt big stick on Thursday.

It made me sick to my stomach. I wanted to vomit. I felt so bad, personally, and professionally, for all I had given to the sports-talk format in San Diego, and for all the employees who have come, gone, been hired-fired, and now laid off.

It’s a complex story of why two legendary sports-talk stations, iconic in history, with tremendous ratings and revenue success in the past, are now programming Chinese Mandarin and Spanish Talk.

Here’s an insiders view of what has happened:

HISTORY..John Lynch founded the original sports-talk station, XTRA-690 in 1988, under the Noble Broadcast banner, operating it into the late 1990s, when the station was taken over by Jacor, and then sold to Clear Channel Radio, then on its nationwide spending spree to buy stations everywhere. It went out of business in 2002, when Clear Channel dissolved it, moving the format to Los Angeles.

Lynch resurfaced to create the Mighty 1090, putting it on the air in 2003, running it until 2012, when he was forcibly removed. His investors over that run included real estate magnate Doug Manchester, Viejas Casino, and then JMI-John Moores Incorporated.

690 had big ratings-revenue success, till corporate radio made some strange decisions. 1090 struggled financially for years, till its demise, impacted by bad decisions almost from the start.

OWNERSHIP…XTRA-690 and the Mighty 1090’s signals and program licenses were held by Mexican groups, who then leased the towers and program licenses to Lynch to program initially solid Gold music (69-XTRA Gold), which evolved into News-Talk, then launched sports talk. The 1090 signal became Sports-Talk for its long run. Ownership poured enormous amounts of money into the Mexican coffers to operate one of the most expensive formats in radio, Sports-Talk, and play-by-play. XTRA 690 was the longtime home of the San Diego Chargers. 1090 was the flagship station for the Padres.

THE ENDING…It happened suddenly for 690. Clear Channel decided to exit Mexican radio ownership in 2002, not because of money problems, but to reach the FCC mandated quota of how many stations you could own in a market. But in doing so, it decided to get rid of the big signal that 690 had, while retaining two smaller ‘AM’ signals, KSDO-1130 and KPOP-1360. Years later, Clear Channel execs admitted they made a terrible mistake giving up the highly rated 690 stick, that was billing upwards of 9M a year as a regional station, to move the format to Los Angeles. The Mighty 1090 sank under the weight of huge debt, the fees paid to the two Mexican ownerships, enormous financial losses incurred in Padres rights fees, a changing advertising market. It ended quickly when the two Mexican owners took over the three stations, for lack of payments. BCA lost its FM and ESPN 1700, then lost 1090. In their final staff meeting, ownership told what employees that were left, there was no more money to do business. Employees were given 20-days to accept whatever severance packages were offered, or they to would be taken off the table. Some form of bankruptcy is likely on the horizon. an awful finish for two big signals that had been successful in the past.

FINANCIALS…XTRA 690 made money, though they spent money. They were paying 3M a year for the Chargers-NFL rights fees, when the Spanos family elected to leave the station, to try to do a bigger money deal at KFMB AM-FM-TV. The Chargers wound up going to 4-different stations over their final years, never getting what they were paid at 690, then moved the franchise to Los Angeles. 1090 lost an estimated 20M with the high rights fees paid to the Padres, complicated by a decade worth of bad baseball, which became less and less saleable. Sources say in the 13-years 1090 operated, it lost 30M total. When it shutdown this week, 1090 still owed more than 300,000 in back fees to the two Mexican owners it rented the stations from Jaime Bonilla-Tijuana and Andre Bichara-Monterrey. Neither wanted to do business with BCA-1090, until the past debts were repaid. No incoming investors wanted to take on the old debt.

THE DEALS…JMI walked away from 1090 funding three months ago. This despite a reduced lease agreement with both Mexican owners for one year. The stations fees to the two Mexican owners totalled 4M per year to Bonilla and Bichara. That was before you ever turned the lights on, and that was in addition to the rights fees that had to be paid to the pro teams they carried, and the money paid to talkshow hosts, plus operating expenses. Sources say at the end, the stations were billing 300,000 per month in ad revenues, bringing in some 3.5M annually for the three station cluster. Expenses were in excess of 5M, with cost of operation and payroll. Financial losses yearly amounted to 2-to-4M. It was not sustainable. Despite a 1-year reduction in fees, that expired in 2018, the station was still bleeding money. Sources say the 1090 owners were hit with an additional bill, from one of the Mexican owners, who wanted an additional 250,000 payment for Mexican FCC charges. JMI, funding the stations, said no. It was the end of the relationship at JMI, who had replaced Viejas, who had walked away years prior because of massive financial losses.

INSIDE THE BUILDING….At the end you could throw a hand grenade down the hallways, and not hit anyone. BCA had gone thru 3-rounds of staff layoffs. They were operating a major market station with a skeleton crew. The top executives were all mandated to take paycuts from the 6-figure contracts they were making. The station walked away from the Padres contract, and yet the financial losses continued. Morale died, and then falling behind in payments, Bonilla seized his two stations, the Max FM and ESPN 1700. And then Bichara seized 1090 shutting it down.

BLAME GAME…It would be easy to point fingers at the players in this tragic play, but it was a deeply flawed business model, exasperated by mistake after mistake. A look at the players in all this.

JOHN LYNCH…A brilliant entrepreneur, with all types of ideas about the future of the format. He put together XTRA-690, launching it at the same time as WFAN-New York and WIP-Philadelphia. But he bears the responsibility of all the bad deals that led to the demise of 690, and then the painful death of 1090. Grossly overpaying for the Chargers-Padres rights hurt the station. The financial deals he made to lease 1090, the Max and ESPN 1700, both who had bad signals, were excessive, and led to the stations death. The cost was 4M-annually. As brilliant as he was as an idea man, using other peoples money, history will write he lost 690-1090, and left the Union Tribune after his creative 7M-TV investment (UTTV) failed.

MIKE GLICKENHAUS…One of a series of GMs, and the latest, who tried to stop the bleeding. His idea of doing a ton more digital, as a way to create revenue streams, could not generate enough revenue, as the bills mounted. He spent 400,000 of JMI money to try and improve the signal of the Max FM, only to see it fail, and then have the owner seize the station. A Lynch protege, he was also removed at 690, then as GM of Finest City Broadcasting, a 3-station FM block he helped create, the UT, and now 1090. He inherited a mess, and eventually drowned in the red-ink.

MIKE SHEPARD…A long time program director in music, he came in to oversee the operation of all three stations. A music programming guy doing sports, was open to debate, but he lived and worked long hours, then was let go in the cutbacks with the end just on the horizon. An innocent victim.

GABE HOBBS….A longtime consultant, brought in to try and rally the station. How someone in Tampa Bay is supposed to program a San Diego station boggles the mind. His hirings of JD Hayworth, Dan Sileo, and his decision to jettison, Lee Hamilton, force out John Kentera, and watch the Padres-Aztecs leave the station played a part in the station demise. 1090 was 8th in the ratings at one point, in a 31-station market. When Hobbs contract ended, the station had plunged to 25th in the market. I asked the question when I was bought out, after they did everything Hobbs wanted, “are you a better station without Hacksaw-Coach-Padres-Aztecs?” Never got an answer. The ratings scoreboard does not lie.

DOUG MANCHESTER…One of Lynch’s initial investors, he cashed his chips in early, forcing a mad scramble to find new investors. His attention span to the radio project was short, and he wanted out. He eventually bought the Union Tribune, then sold the paper, and kept that building, now converting it into another one of his many hotels. He is an entrepreneur.

VIEJAS….Lynch used his personality and sales skills to convince the Indian nation to be an investor. It was not an easy relationship, for Viejas did not get rich by losing 4M a year in radio. They opted out after years of red-ink.

JMI….Ex Padres owner John Moore group took over from Viejas. Few knew or realized the real owner was the philanthropic Becky Moores, who took over that segment of the JMI empire in divorce proceedings. She funded the station as the lead-silent investor for years, until the losses and the Mexican owner conflicts, drove her out. Give her credit for benevolence.

MEXICO…When the radio economy was healthy, a station might have been able to survive with the rental fees the Mexican owners charged Lynch’s group, Nobel Broadcast, then BCA. The same with what 1090’s owners wanted JMI to pay. But the collapse of the advertising economy, the collapse of the ratings, the loss of the NFL team, and the defection of the Padres, became catastrophic. There are other groups in San Diego that own Mexican stations (LMA-Local Media) and the Univision stations, and they have done well with better leases with Mexican owners. BCA never had that luxury. When BCA tried to actually purchase 1090-the Max-1700, they were told it would take some 20M to buy the FM-1700 combo and 11M to outright purchase the 1090 signal. That’s a 31M outlay, when US brokers say the stations are probably worth no more than 5M apiece. For Mexico, it was, and always has been about taking US money. They turned out to be bad partners.

CHARGERS-PADRES…Both franchises have always been out for paydays. The Chargers left 690, right after their Super Bowl run, and they never got close to the rights fees they had as they moved from station to station. The Padres left a legendary relationship at KFMB for years, went to Clear Channel-KOGO and have bounced around since then. They took 1090’s big money offer, and then left to go Entercom, in strictly a ‘give me a check’ deal, now on an FM station you cannot hear across the entire county or up the inland empire. The word ‘partnership’ hasn’t really been part of the Chargers-Padres language, but they are in business for themselves, no one else..

ARBITRON….Radio stations live and die off the Neilsen-Arbitron ratings, an imperfect science, whereby listeners are paid to wear a meter that registers what stations you listen to electronically. The inequity is there is no way to tell who gets meters, what part of the market they live in, what their habits are. KPBS, with 1-hour local programming is the top rated station in the market, because their listeners, turn the station on, and listen to PBS programming all day skewing the ratings. What if a preponderance of meters wind up in the Hispanic community, is that a fair and impartial allocation to get a balanced listening group. What if there are few meters in places like LaJolla, or the North County or East Bay? Advertising agencies crunch numbers, and they control probably 75% of the ad revenue in the market. If you don’t have ratings, you don’t have a chance.

DIGITAL WORLD…In this new age of so many ways to deliver information, news, sports, talk, music, video, the clout of stations, even with big time signals is lessened. Radio wants in on all this, but in promoting its websites and digital apps, it’s inviting listeners to go away from their shows, to become ‘select listeners’. In doing so, they have forgotten that Neilsen does not rate digital, just the stations themselves, who is listening and for how long. On top of that, station websites still don’t create huge addendum billing for the stations.

SAN DIEGO MARKET…It may have a population base of 3.3M now, but it does not have the advertising economy you would normally have. Few Fortune 500-companies, not a lot of huge industries, and a plethora of media companies clawing at the advertising pie. The big broadcast companies, I-Heart and Entercom have select stations doing well in the economy. The rest have to fight for table crumbs of advertising nickels left out there. The advertising market has never really come back, nor grown with the population base.

THE FUTURE….There are two all sports stations left in the market, the Fan 97-3, the Padres flagship, owned by Entercom, and XTRA-1360-owned by I-Heart Radio. Neither is a big time player in the market. There is at least one broadcast business group interested in finding a way to take over the 1090 facilities, and talent roster, but it will not pay off the old debt. A newly formed company may still yet surface, but it has to be on a big signal. Dealing with the Mexican X-stations, may not be the solution, maybe buying the KFMB-AM-FM Stations may be the road to go. But that would take an investment of some 30M, the asking price the new KFMB owners, Tegna, are asking. Doing business at a “K” station rather than an “X” signal out of Mexico may be the only way to survive.

THE RATINGS…The ratings issued for March comparing the 3-all sports stations in San Diego. 1090 owned the format.

———-

Day-Parts….Men 25-54

…………….1090…97-3….1360
6-9am……4.0…..1.3……0.9…

9-noon…..3.0…..1.5……2.2…

12-3pm…..6.3…..2.4…..1.1..

3-6pm……6.5……2.1……1.2..

6-9pm……1.0……3.2……1.3..

————

THE AUTOPSY…. There are two sets of lines on the street right now. On the line to your left, all the talent that was victimized by all the decisions leadership made that impacted and ended careers. Hacksaw, Coach, Dave & Jeff, Darrin Smith, Marty Caswell, Scott & BR, and a huge roster of dedicated young support people, producers, board ops, production people, sales people etc.

On the line on the right-hand side are all the people in management, the decision-makers, the money people, who did all these deals, that led to the demise of two iconic sports stations.

You can identify them, they are the ones standing in line to wash their hands in the restroom, hoping to get rid of the ‘blood on their hands’ for what happened to two pretty good all sports signals.

There are a pretty good cross section of talkshow talents out of work right now in San Diego. All because of other people’s decision. Maybe they will resurface in the coming months, if the two financial groups can find a way to put the station on the air with new leadership.

No one wants to listen to Chinese Mandarin talk on 690 or Spanish talk on 1090.

A lot of reasons why this happened. A lot of blame to go around too.

Instead we wait and hope. We also wait and watch the guys in the line on the right. You know, the ones with ‘blood on their hands’.

RIP….Mighty 1090…..XTRA-Sports-690.

======================

Leave a Comment:

Your email address will not be published. Required fields are marked *