Storer Communications
Storer Communications, known from 1927 to 1952 as the Fort Industry Company and from 1952 to 1983 as Storer Broadcasting, was an American media company that owned television and radio stations and cable television systems.
Founded by George Butler Storer and John Harold Ryan as the Fort Industry Oil Company in Toledo, Ohio, the company's focus quickly shifted to radio ownership, particularly in Ohio, Michigan and West Virginia. Fort Industry added television stations to their portfolio, adopted the Storer name in 1952, and eventually owned multiple key affiliates of the CBS television network. Storer also acquired a reputation for selling smaller stations in order to purchase larger ones, particularly after the company reached then-existent ownership limits. The company also owned Northeast Airlines from 1965 to 1972, and the Boston Bruins from 1973 to 1975. A reorientation towards cable television led Storer to divest their radio holdings between 1979 and 1981. While this expansion led to Storer becoming the fourth-largest cable operator in the country, the systems built were expensive and unprofitable in the short-term, and the company suffered substantial losses in the mid-1980s.
In April 1985, a group of activist investors attempted to take over Storer's board of directors and initiate a liquidation. To thwart this, the company agreed to be taken private by Kohlberg Kravis Roberts in a leveraged buyout valued at $1.6 billion. Storer was dismantled in the following years under KKR: the cable division was spun off and gradually dissolved into both TCI and Comcast, while the television stations were sold to George N. Gillett Jr. in 1987 and folded into New World Communications in 1993.
History
Origins
George B. Storer was born on November 10, 1899, in Toledo, Ohio. His interest in radio dated back to 1912, when—inspired by the sinking of the Titanic that increased awareness of wireless radio—he listened to activity over a ham radio and experimented with a transmitter, both home-built. Originally planning to attend Yale University for engineering, the outbreak of World War I prompted Storer to travel to Canada at age 17 and register with the Royal Canadian Air Force; having one deaf ear, Storer instead registered with the Student Army Training Corps and was assigned to Cornell University.Following the war, Storer studied journalism at Cornell and was editor of the student newspaper, The Cornell Daily Sun; he took over the family's Standard Steel Tube in Toledo in 1920 after the death of his father. Standard Steel Tube merged into the Elyria Iron and Steel Company in 1925, with Storer as vice-president of manufacturing; it became part of Republic Steel, where Storer became vice president. Between 1925 and 1928, Storer and brother-in-law J. Harold Ryan built thirteen service stations for Speedene brand gasoline in the Toledo and Cleveland areas. Unlike most service stations in operation, these were built next to railroad siding and had large adjacent fuel tanks filled directly from tank cars, an idea that Storer thought of when looking outside the window of his Toledo office. This move bypassed the cost of trucking gasoline and the resulting savings were passed down to the customer. In 1927, Storer and Ryan founded the Fort Industry Oil Company to manage these stations, so named for an 1790s Army fort of unknown location reckoned to be where downtown Toledo sits today.
Storer decided to buy advertising on Toledo radio station WTAL for the service stations, which were shut out of newspaper advertising by the influential petroleum industry. Learning about WTAL's existing financial issues, Storer decided to buy the station for $3,500, thinking it would be more cost-effective than merely advertising. WTAL was renamed WSPD on February 20, 1928, derived from Speedene, and became the eighth affiliate for the Columbia Broadcasting System. WSPD's studios were moved to the Hotel Commodore Perry, which also housed the corporate offices for Fort Industry. Storer took an executive role with Detroit–based American Metal Products in 1928, which contracted with Ford Motor Company, and within a year turned a $650,000 profit; renamed Standard Tube, Storer oversaw this company and Ryan oversaw Fort Industry.
Detroit CBS affiliate WGHP was purchased in 1928 at the recommendation of network executive J. Andrew White. Acting on advice given to Storer by his physician, Fort Industry sold the station in 1930 to theater owners John H. Kunsky and George W. Trendle, who relaunched it as WXYZ. The Wall Street crash of 1929, coupled with price wars at the Speedene gas stations due to stiffened competition, resulted in radio becoming a standout for Fort Industry.
Focusing on radio
Recognizing the newfound enthusiasm in broadcasting, Fort Industry sold its oil interests in May 1931 to Standard Oil of Ohio, deleting "oil" from the company name. That same year, Fort Industry bought WWVA in Wheeling, West Virginia: referred by Storer as "our one-station network", WWVA joined CBS and became renowned for the Wheeling Jamboree. By 1941, WWVA was upgraded to 50,000 watts. Storer and Ryan were involved with the June 1932 establishment of Windsor, Ontario, station CKOK, serving at the CBS affiliate for both it and Detroit, but Canadian Radio League chairman Graham Spry protested CKOK's license renewal and requested an inquiry into the station's foreign ownership. CKOK was consolidated with London, Ontario, station CJGC in April 1933 to form CKLW, without Storer and Ryan's direct involvement. Storer retained a minority stake in CKLW until selling it in 1936 under pressure from Canadian regulators; by then, Fort Industry had also become a nominal investor in Seattle station KIRO. WMMN in Fairmont, West Virginia, was acquired in 1935 and also became a CBS affiliate. WBLY in Lima, Ohio, was purchased in 1937 and renamed WLOK in 1939; the "OK" was derived from the former CKOK calls.Storer was involved in the operations of the American Broadcasting System, one of several attempts in the early 1930s for a third commercial radio network to compete against CBS and the "Red" and "Blue" networks of NBC. Launched in October 1934, WMCA in New York City was the initial flagship of a chain of twenty-four stations largely concentrated on the East Coast. After Storer and WMCA failed to reach a long-term arrangement, WNEW became the new flagship and the network was reorganized as the American Broadcasting Company, with Arde Bulova as an investor. Despite well-received programming and news coverage, this network lost considerable sums of money heightened by the Great Depression, dropped all but ten affiliates on March 5, 1935, and ceased operations entirely by March 26.
Fort Industry became part of a complicated 1934 relocation request for WALR in Zanesville, Ohio, to Toledo. While the proposal had the new Toledo station running under nominally separate ownership, Fort Industry was revealed to be a stockholder and was thought could exercise control over the station. Denied the request in 1937, Fort Industry became a majority investor in WALR through West Virginia Broadcasting—the licensee for WWVA and WMMN—and renamed it WHIZ in 1939, concurrent with the station joining NBC Radio.
After the United States entered World War II in December 1941, Ryan took a leave of absence as Fort Industry's vice president/general manager to serve as the Office of Censorship radio censor under Byron Price; Storer's Standard Tube plant was also converted to manufacture shell casings. Storer was appointed assistant chairman for the Broadcasters Victory Council, then joined the United States Navy in 1943 as a lieutenant commander, first in Chicago as a procurement officer and then stationed both at the West Coast and in Washington, D.C.
Atlanta radio station WAGA was purchased in April 1940 through an all-stock transaction; Storer intended to establish a secondary residence in the city. WFTL, licensed to Fort Lauderdale, Florida, was acquired in 1944 as Fort Industry's seventh radio station and moved to Miami outright; the call sign was changed in 1945 to WGBS, bearing Storer's initials. Storer resided in nearby Surfside and had a presence in the Miami area since 1934. By 1947, WGBS, WWVA and WAGA entered into a group affiliation deal with CBS. WJBK in Detroit was purchased in August 1946; Fort Industry owned a minority stake in the station since 1933. Regulatory approval took nearly one year and required the sale of WHIZ to the Littick family. A bidding war took place in late 1948 between Fort Industry and Crosley Broadcasting Corporation for WHAS in Louisville, Kentucky, with Storer saying the company would "dispose of certain radio facilities" to get approval; the Federal Communications Commission was considering setting an ownership limit of seven AM stations, six FM stations and five TV stations. Both bids were rejected.
Fort Industry also sold off their minority stake in KIRO to Washington governor Monrad Wallgren in 1947 and bought majority control of the Miami Beach Sun and Star newspapers in 1948. The newspaper acquisition drew comparisons to broadcaster-turned-publisher Eugene S. Pulliam, who took over The Indianapolis Star four year earlier. The Sun, along with three other community weekly papers, were later sold to a group led by Miami Herald publisher John S. Knight in May 1963.
Expansion into television
In 1948, Fort Industry entered the television market, launching WSPD-TV in Toledo on July 21, 1948. This was followed by WJBK-TV in Detroit on October 24, 1948, and WAGA-TV in Atlanta on March 8, 1949. Fort Industry also sought a television station in Wheeling, first filing for the channel 7 allocation, then pursued channel 9 in nearby Steubenville, Ohio, after the FCC instituted "a freeze" on new license permits. WLOK and WLOK-FM were sold to Lloyd Pixley in 1951 so Fort Industry could purchase WSAI and WSAI-FM in Cincinnati, which also included a construction permit for a UHF station. The WSAI stations were sold off in 1953 to complete the purchase of WBRC and WBRC-TV in Birmingham, Alabama. KABC in San Antonio was also purchased in 1953, pairing it with KEYL, which Fort Industry purchased two years earlier; WMMN was sold off to People's Broadcasting. KABC and KEYL were then renamed KGBS and KGBS-TV. The corporate name changed from Fort Industry to the Storer Broadcasting Company in May 1952, reflecting a complete break from the company's industrial origins. By 1953, the company announced the moving of their corporate offices to Miami.The company acquired the Empire Coil Company, a manufacturer of coils and transformers for radios and the owner of WXEL in Cleveland and KPTV in Portland, Oregon, for $8.5 million in January 1954; the purchase came days after Empire's dispersal of KCTY, a failed UHF station in Kansas City, Missouri. KGBS and KGBS-TV were spun off to accommodate the purchase. Empire's factory in New Rochelle, New York, remained active until Storer closed it in 1955, having failed to turn a profit. WJW radio was subsequently purchased and paired with WXEL, which was renamed WJW-TV in 1956. KPTV only had 38 percent of the market's television viewers able to receive the station clearly despite substantial capital improvements, characteristic of UHF's struggles prior to the All-Channel Receiver Act. KPTV was sold off in 1957, allowing that station to "move" to VHF as a consolidation with KOLR.
WJW's studios in Playhouse Square were remodeled into a colonial revival design that evoked 1770-era Georgian architecture; this design was also implemented at WGBS and WJBK-TV's studio building. Other stations had studios built to resemble Southern antebellum mansions, beginning with WBRC-TV in September 1954 and copied at WAGA-TV in 1966.
WBRC radio and television were sold to Taft Broadcasting in 1957; this was to facilitate the purchase of WIBG in Philadelphia and WVUE in Wilmington, Delaware, and followed an aborted sale of WAGA radio and TV to The Washington Post. WVUE was shut down in 1958 so Storer could purchase WITI in Whitefish Bay, Wisconsin, which moved to Milwaukee the following year. To complete Storer's purchase of KPOP in Los Angeles WAGA and WAGA-FM were spun off to Plough, Inc. in April 1959, and renamed WPLO and WPLO-FM. WWVA and WWVA-FM were sold off in 1962 as a condition of Storer's $10.9 million purchase of WMGM in New York City, then an industry record, which reverted to the WHN call sign. WIHS-TV in Boston was purchased in 1966, and renamed WSBK-TV; like WBRC and WAGA, WSBK received a new studio building in 1969 with an Antebellum design.
Storer sought to upgrade KGBS, which was a daytime-only station, including a power increase to 50,000 watts that saw billing increase by 100 percent year-over-year. In 1966, FM outlet KFMU was acquired and simulcast with KGBS as KGBS-FM, providing 24-hour service to the market. The two stations instituted a country music format upon the combination. The "countrypolitan" format was expanded to Cleveland in January 1968 as WJW-FM became WCJW; Detroit followed in December 1969 with WJBK and WJBK-FM relaunched as WDEE and WDEE-FM. WGBS-FM was renamed WJHR in 1969, in tribute to Ryan, but continued featuring automated music formats.
By 1965, Storer was the nation's largest broadcaster not connected to the "Big Three" television networks and regarded as "the first independent group broadcaster". It had a reputation of constantly selling stations in smaller markets in order to buy stations in larger markets, but made capital investments to improve and increase power for every station it owned. The gamble on television in 1948—made when other broadcast chains disparaged the medium—paid off with WAGA-TV, WSPD-TV and WJBK-TV turning a profit by 1951, surpassing all internal expectations. In 1958, Storer had a profit of $65 million and an annual income of $16 million. The company's expansion practices were emulated and copied by Corinthian Broadcasting, Cox Media Group, Capital Cities and Metromedia.
Three of George Storer's sons all held roles within Storer Broadcasting in what was referred to as the company's "informal organization". George B. Storer, Jr. began working at WAGA-TV; by 1957, he became vice president of the television division, and by 1961 was president. James Storer, who was legally blind, started work at WGBS, was general manager of WJW radio by 1962 and eventually elevated to vice president of Storer's radio division. Peter Storer also began at WGBS as an engineer; aside from a brief time at CBS Radio spot sales, Peter moved up in managerial roles to lead Storer's television sales division, and by 1967 was vice president. All three ascended to vice-presidency roles in relatively quick timeframes, accentuating the family ties. Their promotions came alongside the death of J. Harold Ryan in June 1961 at age 75, who was still actively in the role of senior vice president.