WPHT is doing what any smart owner with a 50KW AM signal would do: air the top hosts in their time slots. Most listened to national hosts, with the exception of morning drive, give you the best shot of good ratings and good revenue.
From the very start of network radio, that is what stations have done. Networks searched out the best talents to put on the most powerful stations, to make the most money for all involved, while giving listeners the entertainment and news they wanted. It's worked almost non-stop since the 1930's. Much of radio content was national network programming then, as it is now.
The only reason for more local content in the 50's and 60's was due to television taking the soap operas and comedians from radio. Network radio was dead. Radio had to find something to remain profitable (or in business at all!). Enter the local disc jockeys. Live and local was because they could think of nothing else to do to survive.
Then along came FM and a more than 100% increase in the number of station options listeners had. Music went to FM and AM was left to again wonder what to do. The answer came again from disc jockeys. People like Rush, Imus and Stern stopped playing music and started doing talk in a basic Top 40 Radio style. Imus went for humor, interviews and guy talk. Rush went to political talk. Stern went to a cutting edge humor on AM (remember his PM Drive show on WNNNNNNNBC?) and AM radio was saved. Or at least the big stations were.
Basically, AM radio was left to go back to the business plan of the 1930's and 40's. Only now, they could choose from many networks instead of just one, whether it be Mutual, NBC, CBS or ABC. Stations compete for the best network shows, hoping to put together a winning line-up.
The reduction in regulation takes into account the modern day number of stations and demographics. Before, all stations had to carry religion, farm reports, sports, news, etc. Now we have enough stations so that some can specialize in sports, religion, news, and in farm country, farm reports. I worked for a city station in the days when they had to carry "X" number minutes of agricultural news a week! The only crop our listeners could raise was a few weeds in their front yard (if they had one). Now stations are freed from those nonsense rules and can concentrate on whatever their main product is.
We do not need to return to radio as it was in the 50's and 60's. Today, WFIL and WVCH can concentrate on religion, WIP and WPEN can go for sports, 990 can do whatever it is doing, KYW gives us news and WPHT gives us sports.
What we no longer need are the hundreds of small suburban AM stations which can no longer find anything of merit to air. The revenue is not there to support them, they can no longer afford to be the minor league system of radio, and who is listening anyway!
Radio is a business. And it is a business that somehow has survived despite many good reasons to fail.