Origins

     ABC-as a network and an owner of major radio stations­ was created in the 1940s, when the Federal Communications Commission and the Department of Justice forced the National Broadcasting Company's (NBC) owner, the Radio Corporation of America (RCA), to spin off one of NBC's two radio networks. In 1943 Edward J. Noble, who had made his fortune creating, manufacturing, and selling Life Savers candy, bought NBC's Blue network and three owned and operated stations for $8 million. In 1945 Noble renamed Blue the American Broadcasting Company and began to build ABC. In 1946, for example, he acquired WXYZ-AM in Detroit from King­ Trendle Broadcasting for slightly less than $3 million.

     The Blue network carried a number of popular shows­ including Just Plain Bill, Easy Aces, Inner Sanctum Mystery, and Lum 'n' Abner. But generally ABC shows drew last place in ratings in all of Golden Age radio's categories of programming. In the variety category, for example, ABC's The Alan Young Show earned but a seventh of the ratings of NBC's Bob Hope Program, which broadcast later the same night. The Andrews Sisters program drew a third of the ratings of Your Hit Parade on the Columbia Broadcasting System (CBS), and Ted Mack's Original Amateur Hour always finished far behind Arthur Godfrey's Talent Scouts.

     Still, Drew Pearson attracted vast audiences with his reports of the goings-on in the nation's capital, and the dramatic and controversial re-creations of the March of Time were popular as well, helped by the movie newsreel of the same name and by the program's connection with Time magazine. On the prestige side, ABC's regular Saturday matinee broadcasts of the Metropolitan Opera added some class to ABC's image.

     It was not that Edward Noble was not willing to acquire top talent. During the late 1940s, Noble and his managers tried to add new shows, such as Professor Quiz, Break the Bank, This is Your FBI, Lone Ranger, Gillette Fights, and Gangbusters. For example, when ABC bought WXYZ-AM, it acquired Lone Ranger and Green Hornet. A far more temporary triumph came with the hiring of Milton Berle, for this comic appeared on the ABC radio network for only one year before, looking for a showcase better suited to his visual style, he moved to NBC television and became a national sensation.

     There were two notable exceptions. In 1946 Bing Crosby moved to the ABC radio network for reasons of convenience and technical change. Crosby, who was then at the very height of his popularity as a singer and movie star, agreed to move to ABC because NBC was forcing him to broadcast his show live twice, once for the eastern and central time zones and then a second time for stations based in the mountain and pacific time zones. Crosby wanted to use audiotape to record his show at his convenience. ABC executives were more than willing to permit Crosby to use the then new audiotape technology to record his show ahead of time and then hit the links when listeners thought he was in the studio broadcasting to them.

     During summer 1946, Crosby shocked the industry when he announced he was leaving NBC and long-time sponsor Kraft to sign with Philco, maker of radio sets, and appear on ABC. His weekly salary was announced at a staggering $7,500. Because Philco and ABC permitted Crosby to precord his Philco Radio Time, he was nowhere near the studio when his show debuted on Wednesday night, 16 October 1946. The Philco show proved a major ratings triumph. Because of its success, three years later, when CBS chief Will­iam S. Paley was in the midst of his celebrated "talent raids," he lured Crosby away from his three-year run on ABC. Philco Radio Time last ran on ABC on 1 June 1949.

     The other exception to ABC's normal ratings mediocrity started in March 1948 when Stop the Music! premiered. Listeners quickly embraced this giant jackpot quiz show. With master of ceremonies Bert Parks as its host, musical selections were played by the Harry Salter Orchestra or sung by vocalists Kay Armen and Dick Brown. While a song was playing, a telephone call was placed to a home somewhere in the United States, and when the caller answered, Parks called out "stop the music." If the person at home could name the tune, he or she won up to $20,000.

     Listeners flocked to ABC on Sunday nights, and by the summer ABC truly had a hit, doubling the audience reached by Fred Allen at NBC and Sam Spade on CBS. With ratings high from the beginning, sponsors lined up, and ABC selected Old Gold cigarettes and Spiedel jewelry as the main advertisers. During summer 1948, demand for tickets was so high that the producers moved the show to the 4,000-seat Capitol Theater in the heart of Times Square. But ABC could not sustain the hit, and by 1952 the radio version was off the air. The fledgling ABC television network kept it on the tube-originally as just a simulcast-until 1956.

     As the Golden Age in radio was ending, ABC certainly matched Mutual as a radio network, but it was rarely as successful as NBC and CBS. Building ABC as a radio network was always a struggle, yet from a network with 168 owned or affiliated stations as of the October 1943 purchase date, Noble and his managers doubled affiliations within a decade. Indeed, owning and operating radio stations and a network was lucrative enough that Noble-with the help of a $5 million loan from the Prudential Insurance Company of America-was able to launch the ABC television network. By the beginning of the 1950s, ABC not only owned a radio network and the maximum allowable number of AM and FM radio stations, but had also reached the legal limit on television stations as well-five. So successful was ABC that Noble began to attract bidders for his enterprise.

The United Paramount Takeover

     In 1951, in what was up to that point the biggest transaction in broadcasting history, United Paramount (the chain of movie houses formerly owned by Paramount Pictures) paid $25 million to add ABC's five television stations, six FM radio stations, and six AM radio stations to its 644 theaters in nearly 300 cities across the United States. The FCC took two years to finally approve the deal. ABC would never have become a modern radio and television corporate powerhouse had it not been acquired by United Paramount, greatly adding to its financial resources. Leonard H. Goldenson, head of United Paramount, began to sell theaters and real estate to generate the cash necessary to build up ABC television first and ABC radio second.

     On the radio side, Goldenson faced a challenge. Most of ABC's radio affiliates were lower-power stations in smaller cities. When forced to divest RCA of the Blue network a decade earlier, RCA had stacked the deck, making sure that what he transferred with Blue represented the least valuable of NBC's stations. To generate income, ABC radio management, headed by Robert Kintner, allowed advertising for products considered inappropriate by the mighty NBC and CBS, such as deodorants and laxatives. But in 1953 Goldenson felt radio would need to change as television became America's top mass medium. With AM radio now standard equipment on most new cars, and with the innovation of the inexpensive portable radio set, Goldenson reasoned that a radio market would always exist, but in a different form than had worked in the past. The question for ABC-and for all of radio in 1953- was how best to exploit the changing radio medium.

     Goldenson realized that while United Paramount had gained a network with the ABC purchase, more important were the stations located in some of the nation's largest markets. The flagship station in New York City-WJZ-AM-was his most valuable radio asset, worth more than the then struggling ABC radio network. Still, whereas WNBC-AM had studios at Radio City, WJZ-AM broadcast from a modest renovated building at 7 West 66th Street, one block west of Central Park. On 1 May 1953-six and a half years after the rival network's stations were named WNBC-AM and WCBS­ AM in honor of their respective parent companies-Goldenson renamed his New York City outlet WABC-AM and worked to make this 50,000-watt powerhouse a metropolitan fixture at "77" on the AM band.

     Programming proved harder to change, so Goldenson stuck with what was working for the time being. In the mid 1950s that meant shows such as American Safety Razor's Walter Winchell on Sunday nights; Anheuser Busch's Bill Stern's Sports Reports at 6:30 P.M. three times a week; General Mills' Lone Ranger at 7:30 P.M. on Mondays, Wednesdays, and Fridays; and Mutual of Omaha's Breakfast Club in the mornings. Goldenson's innovation was to hire local personalities to develop followings only within the New York City metropolitan market. For WABC-AM, this meant in time Peter Lind Hayes and Mary Healy, Martin Block, Ernie Kovacs, Howard Cosell (and his sports reports), commentators John Daly and Edward P. Morgan, and rock disc jockey sensation Alan Freed.

     The transition of WABC-AM to the highest-rated rock station in the United States began modestly with Martin Block's Make Believe Ballroom, which Goldenson bought in 195 4. But it was the June 1958 hiring of Alan Freed that would signal the future of WABC-AM as a Top 40 profit-generating power­ house. Freed would soon burn out in the payola scandals, but WABC disc jockeys "Cousin Brucie," "Big Dan Ingram," and others replaced him, and by the arrival of the Beatles in early 1964, WABC-AM had become one of the nation's most­ listened-to radio stations.

     Goldenson's management team rebuilt the other owned and operated ABC radio stations: WLS-AM in Chicago, WXYZ­ AM in Detroit, KABC-AM (formerly KECA-AM) in Hollywood, KQV-AM in Pittsburgh, and KGO-AM in San Francisco. Each would soon take its place among the top-rated stations in its metropolitan area. Each also beefed up an FM license that had been underutilized.

     For example, Chicago's clear channel WLS-AM was transformed from a major-market network affiliate to a rock and roll pioneer, beaming Top 40 hits across the Midwestern states. As the 1960s commenced, WLS-AM had joined the Top 40 elite and was being built up by a number of local disc jockey stars-none hotter, or more famous, than· Larry Lu jack. For a generation of listeners in the 1960s and 1970s, Lujack created and defined rock and roll.

     Similar histories could be traced for all of ABC's major radio stations. In Detroit, for example, WXYZ-AM was also transformed into a radio powerhouse, and by Goldenson's own calculations it functioned as ABC's most profitable radio outlet during the 1950s and 1960s. If the selling of United Paramount's theaters and valuable real estate is properly credited with underwriting ABC television network deals with Holly­ wood's Walt Disney and Warner Brothers Companies, one must also credit the revenues generated by profitable radio stations such as WXYZ-AM. Indeed, the rebuilding of AM radio stations was going so well that in 1957 Goldenson separated the television side (which required fashioning alliances with Hollywood) from the radio side (which needed to transform existing properties into local hot spots, station by station) of the business. With this separation, Goldenson emphasized that television and radio management required quite different skills.

Leonard Goldenson's Radio Network Innovations

     Although Leonard H. Goldenson has never been labeled as one of radio's top leaders-in the league with NBC's David Sarnoff or CBS's William S. Paley-many consider that he ought to be. Despite all the hiring and firing of radio talent during the 1950s and 1960s, ABC management at the top varied little as Goldenson and his small set of advisers built ABC radio (and television) into highly profitable media institutions. By 1985, when he stepped down, Goldenson had created a modern media conglomerate. This small-town poor boy from Pennsyl­vania, who managed to graduate from Harvard Law School, learned the mass entertainment business at Paramount Pictures and took over its divested theater division in 1950. He already had some experience in television from Paramount's owned and operated television station in Chicago, WBKB-TV. He had no experience in radio, but he knew of its success as an entertainment medium in cities where Paramount operated theaters.

     Although most kudos for Goldenson go to his development of the ABC television network, media historians also recognize his reinvention of network radio. By refashioning a single all­ things-to-all-audiences network into four-and later more­ specialized radio networks in the late 1960s, Leonard Golden­ son earned his place as a radio pioneer. ABC was transformed from a single radio network into the American Contemporary Network, the American Information Network, the American Entertainment Network, and the American FM Network. This specialization would set the model for network radio for the next three decades.

     However, Goldenson's most significant innovation almost did not come to be. By the early 1960s Goldenson thought he had built up and milked his major-market stations for as much as he could, and he considered abandoning network radio altogether. He seriously entertained bids to sell the ABC radio network-plus all its valuable stations-to Westing­ house for a price reported to be $50 million. But once he got over the shock of the unexpected size of Westinghouse's offer, Goldenson figured that this substantial bid by Westinghouse's experienced executives did not signal the end of the Top 40 radio era; rather, new forms of radio broadcasting did have a future. He turned down Westinghouse and successfully con­tinued to build his own radio empire as part of what was (and is) often incorrectly considered simply a television network business operation.

     At the time, breaking with the mold of a single network was considered a risky proposition. The executives directly responsible for the network radio turnabout were Hal Neal and Ralph Beaudin, who had made their reputations by turning ABC-owned and -operated stations into rock and roll power­ houses. The four networks were patterned from formats of the day. The American Contemporary Network stressed middle of the road music and soft-spoken middle-aged disc jockeys. The American Information Network was all news and talk, patterned after the all-news local stations that CBS and Westinghouse were then pioneering. The American Entertainment Network was a piped-in Top 40 feed, and the FM network was a grab bag, because no one honestly knew the future of FM at that point.

     In planning the four networks, Goldenson, who was already paying American Telephone and Telegraph (AT&T) for transmission by land lines, figured that four would cost only a bit more than one transmission for facilities that were being underutilized. Talent could be drawn from owned and operated stations. By late 1966 the plan for the four networks was in place, and Goldenson gave notice to all advertisers and affiliated stations that the year 1967 would be the final year for ABC as a single radio network. During summer 1967, ABC began heavy promotion of the four-network idea, and quadruple feeds commenced on the first day of 1968 to 500 affiliates.

     In the first year of four-network operation, 1968, Gold­ensen was criticized because ABC lost $8 million. But just four years later the radio division alone was making more than $4 million annually. But by 1972 the network radio division was making $4 million profit per year. As the 1970s ended, ABC's network radio division had 1,500 affiliates and was making $17 million profit per year. In the late 1970s, ABC Contemporary had about 400 affiliates, and the American Information Network had almost 500 affiliates, as did the American Entertainment Network; however, the American FM Network never moved past 200 affiliates. The recasting and specializing of network radio worked for AM stations, but FM gradually found musical niches that would make them the leaders in radio ratings in most markets by 1980.

     Goldenson continued to tinker with the format profile of both ABC's owned and operated stations and its growing number of networks. The advertising community applauded Goldenson's adaptation of focused demographics. In August 1970 ABC separated management of AM from FM owned and operated radio stations, and with the progressive rock format ABC began to remake FM outlets, which had long merely simulcast AM.

Takeovers

     As the 1980s commenced, Goldenson began to slow down. In 1980 his ABC television network ranked number one, and he was able to tout ABC's radio stations as among the most popular in the nation. For example, WABC-AM in New York abandoned Top 40-after 22 years-and soon made even more money with "talk."

     Goldenson needed to find a suitable successor. He wanted to pass "his" company to someone who had the skills to consistently and profitably run a mature multibillion-dollar media empire. After much looking and interviewing, Goldenson met Thomas Murphy, head of Capital Cities Broadcasting, a 30- year-old media company that as the 1980s began owned 7 television stations, 12 radio stations, an assortment of daily and weekly newspapers, and an additional assortment of magazines. Capital Cities was a Wall Street high flyer, known for its efficient management by Murphy and Dan Burke. Goldenson decided that Capital Cities was the logical successor to take over the ABC radio and television networks he had created.

     At the time the deal was announced, in March 1985, it was the largest non-oil merger ever, at $3.5 billion. But although headlines warned of vast changes and ominous negative implications for news and entertainment, none ever really materialized. Murphy, Burke, and their Capital Cities executives simply merged the two media companies, sold off some duplicative properties, and then continued the process of fashioning an even more profitable, even larger media enterprise than Gold­enson had created-one that encompassed forms of mass media from print to television and from film-making to radio network and station operation.

     In radio, Murphy, Burke, and company changed almost nothing. They tinkered on the margins as they tried to follow (not set) trends. They smoothly and efficiently managed format makeovers as Top 40 rock and roll gave way to other formats of pop music. In general, Murphy and Burke transformed ABC's large-city AM powerhouse stations, often to middle of the road talk-format operations. Consider the example of Chi­cago's WLS-AM, symbol of the Top 40 era. When Murphy and Burke took over, its ratings were slipping, and so they worked to reformat WLS-AM again, even as FM was draining away listeners. By the early 1990s, WLS-AM became news-plus-talk radio 890, with no "hot jock," but instead the ramblings of Dr. Laura Schlessinger and Rush Limbaugh. Such transformations took place throughout the matrix of ABC stations, as radio continued to provide core profits to the company now known as Capital Cities/ABC.

     In 1996 Murphy and Burke themselves neared retirement age, and, as Goldenson had done, they sought an alliance with a company to continue ABC. In 1996 the biggest merger in media history was announced when the Walt Disney Company acquired Capital Cities/ABC. Overnight, Disney, far more famous for its movie making and theme parks, became one of the top competitors in the world of radio.

     When Disney announced-its takeover of Capital Cities/ABC at the end of July 1996, the headlines blared about vast potential synergies of a Hollywood studio and a television network. Radio was considered an afterthought. Still, with New York City flagship station WABC-AM leading the list, Disney now had important radio promotional outlets in a half-dozen other top-ten media markets: in media market 2 Los Angeles (three stations), in market 3 Chicago (two stations), in market 4 San Francisco (two stations), in market 6 Detroit (three stations}, in market 7 Dallas (two stations), and in market 8 Washington, D.C. (three stations).

     Disney concentrated on these big cities, but its radio holdings paled in comparison to rival radio powers of the late 20th century such as CBS and Clear Channel. Yet Disney's station reach always remained vast. Disney head Michael Eisner then looked and applied synergies to these urban radio stations. He sold off Capital Cities/ABC's newspapers and other print operations but kept radio-even expanding Disney into more radio with the September 1997 launch of a new network, the ESPN radio network, with its exclusive rights for Major League Baseball for five years. Eisner also rolled out Radio Disney, a live network for families and children under age 12 with a select playlist of special music, much of it from Disney movies and television programs.

     Although radio is a relatively small division at Disney, Dis­ ney management certainly recognizes radio's contribution to Disney profit accumulation. As the 21st century commenced, ABC radio networks programmed ten services, including American Gold, Flashback, Moneytalk, Business Week Report, Rock & Ro/l's Greatest, and Yesterday ... Live!-as well as ABC News Network and ABC Sports radio. Stars included canonical Paul Harvey (by the year 2000 one of the longest-running voices in radio history), the controversial "news commentator" Matt Drudge, and noted sports commentators Tony Kornheiser and Dan Patrick. ESPN offered sports news and talk, based on its companion cable television network, and ABC News expanded its long-running network services with shows spun off from television favorites such as This Week with Sam Donaldson and Cokie Roberts. ABC News also offered on the radio America's Journal, World News This Week, Hal Bruno's Washington Perspective, and Newscall. Disney bragged that its Radio Disney network was reaching r .6 million children and 600,000 moms per week, while American Gold, starring Dick Bartley for four hours per week, offered the most-listened-to nationally syndicated oldies countdown show in the year 2000, in competition with Dick Clark, as a lure for aging baby boomers. Surely, these services-and a multitude of others-will be changed and reinvented as ABC Radio networks continue to refocus vital services.