All-Business News Station Faltering; Half of Staff Fired : Radio: Real estate mogul Fred Sands ends most local programming on KBLA-AM.

Fred Sands, the Santa Monica real estate mogul who last year bought KBLA-AM and introduced an all-business news format, has fired half the radio station’s staff of 30 and is shutting down most of its local programming this week.

Sands bought KDAY-AM early last year for $7.2 million, renamed the former rap station and instituted the business format to fill what he believed was a niche in the market. Sands said he invested another $2 million upgrading technical equipment and hiring a news staff.

But all-business news radio has had difficulty establishing itself as a viable format. Many stations across the country that introduced the format in the 1980s have dropped it as interest in business news sagged along with the economy.

In an interview, Sands said he would stick by the format--but by carrying programming from Colorado Springs-based Business Radio Network. KBLA has been running the network feed during the late night and early morning hours.

Cutting out the local programming and carrying the BRN network “will save (KBLA) a tremendous amount of money,” Sands said. He said the station will also carry syndicated radio news from ABC Radio Networks and Dow Jones. There was confusion at the station about the status of Chuck Ashman’s afternoon drive-time interview show.

“The whole advertising community is suffering. This has been a very difficult time to launch a new station,” Sands explained.

The format changes at KBLA were so ill received by listeners that the radio station could not even attract a large enough audience to register in the local ratings books, analysts said.

Los Angeles is the most competitive radio market in the country, with more than 70 stations competing for slivers of the audience. The AM market is dominated by a handful of stations, such as all-news KFWB and KNX and talk-radio station KABC.

Sands acknowledged that the station is losing money; both an analyst and a former KBLA employee said that the real-estate broker had lost several hundred thousand dollars since introducing the all-business format last April.

Another blow, the ex-employee said, came when real estate developer and KBLA investor Paul Amir refused to put more money into the station. Sands, however, denied there had been a disagreement between himself and Amir. “This was a mutual decision,” he said.

Allen Klein, president of Graphic Media Research, an Encino-based radio consultancy, said KBLA has been hampered by an image problem.

“The old rap format had a unique identity with kids,” he said. “When they went to business news, it didn’t give what was expected. They said it was all business, but it was more of a poor man’s KFWB. The problem was reality did not meet the perception.”

KBLA has been letting staff members go since December and is now down to about 14 employees. Most are technicians to handle the network feeds; the others are a few local ad salesmen. Sands, who also owns hard-rock station KNAC-FM, said he has no plans to sell KBLA.