Victor J. Canales & John Caracciolo
July 22, 2014
For years, Victor Canales was a popular air personality, known as Vic Latino, on stations such as WKTU/New York, WPYO/Orlando and WPTY/Long Island. When the owner of WPTY and sister WBON offered to sell the stations to Vic and partner John Caracciolo - they were both managing the properties at the time - they jumped into station ownership head first. The duo added two more stations to their Long Island cluster, then in 2013, acquired five stations in Florida. On top of that, they own a live venue on the Island and manage another. Here, the two discuss their fledgling radio group - and how they program their stations to succeed.
Vic, when you were on-air, first with Ed Lover and Dr. Dre, then on WKTU and WPTY, did you ever dream of being in ownership?
VIC: Absolutely not. It never crossed my mind. I was more into it being in front of crowd, being more of a talent. John was always more involved in a management and engineering role. Buying the Long Island stations was a unique opportunity. The timing was just right. The economy really tanked in 2008; we were already managing the stations and we had to run a very local sales staff on the street level, pretty lean and mean.
So did you approach the owner to buy the first two stations, or did he approach you?
JOHN: He actually approached us. We were managing the stations for him. He was an absentee owner who found a buyer for the stations, so Vic and I were looking to do something else. But when his deal fell through, he came to us. That's when Vic and I made the decision to make the investment to do it ourselves.
How did you get enough money to afford the stations?
JOHN: Vic went under his mattress to get the money he made from all the DJ gigs he did.
VIC: Actually, we were very lucky to find private equity and have a great relationship with TD Bank to help put a deal together for the first two stations. We don't want to jinx ourselves, but it was easier to do that than signing mortgages on our homes. The private equity company believes in radio; they like the business and helped us put together a deal that not only enabled us to survive, but to prosper even in this economy. TD Bank has been the same way with every deal we've done - and they want us to do more deals. They just happen to like the business and the returns.
Once you officially became owners, did your perspective on the radio business change?
VIC: It didn't change much at all. Both of us had been so involved with the business operations of the stations, we already knew what the priorities were. The thing that was shocking - at least to people on the outside -- is that they don't appreciate the workload involved in operations. It's grueling. We work a lot and we earn hard victories. The days of three-martini lunches and weekday golf dates are no longer.
Do you consider the New York City stations as direct rivals, or do you solely concentrate on Long Island competition?
VIC: We definitely are a local-oriented company that really caters to local clients. Everything we do in Long Island is focused locally; we service local business owners with our four radio stations, and we own an amphitheater in our listening area to bring concerts in for our listeners - and that's another avenue to super-serve our clients.
JOHN: That's said, Vic has it much harder than sales because when you punch up a NYC station or one of our Long Island stations, the average listener isn't able to tell that one station is located in New York City and the other is from Suffolk County. Vic has acquired some of the nation's best programmers who make sure our imaging and programming sounds as good as anything from New York. That's why he has it harder than me. Our sales staff only goes to local clients. They don't compete with New York stations for business in New Jersey or Westchester, but on a listener basis we've got to sound just as sharp.
You're operating a Country station, WJVC, which is now competing against NASH in New York. Has that made your job harder?
VIC: Actually we work in partnership, whether they know it or not. Where their signal ends, our picks up perfectly. Having them helps us because it justifies the format to advertisers. In fact, NASH clients need to advertise on WJVC if they want to reach all the Country fans on the Island. The limits of their frequency help us tremendously.
As you mentioned, JVC has invested in venues. How does that fit in the mix?
VIC: We own one outdoor venue, the Pennysaver Amphitheater , and manage an indoor one as well. To us, it's equal to our stations, but the difference is that we're not doing shows every day of the week. Strategically, we do shows three to four times a month over a four-month period when it's warm out. That's 12-16 shows for our outdoor venue, shows that cater toward our specific radio stations. On July 26th, we're bringing in Darius Rucker to the Amphitheater to perform for My Country WJVC - and the show sold out in 20 minutes. It's the same thing with WPTY; we're doing an EDM dance event on Aug 15th - and that quickly sold out. The stations makes money with sponsorship; and the venue makes money on concessions and merchandise.
JOHN: From a management standpoint, it makes our small East End radio stations look like monsters by bringing 8,000 people to the venue. That's ammo for our sales department. These stations might not have the ratings of the New York City signals or the 50,000-watt power that our Long Island rivals have, but advertisers look at the results when we hold events for our Country, Dance and Spanish properties, and they see the power of our brands.
What made you decide to expand with the purchase of the Florida stations?
VIC: We both spent some time in Florida; I had worked at WPYO/Orlando and John worked for SBS. We're in a great market that's very local, but we're also able to get a good amount of national business. We have a lot of friends in the market who we feel comfortable with. We handed off the helm of the stations to Shane Reeve as our Market Manager for Florida. He previously worked with us for a long time and also locally in Florida for Cumulus, Clear Channel and Cox, so he knows the markets inside and out.
Is there any difference between programming the Florida stations and the Long Island stations?
VIC: We had this same conversation just recently and the bottom line is whether you work in market #1 or #250, the business of radio is still the business of radio. In both markets, we still have DJs on-air, broadcasting essentially the same formats, playing the same artists, and both sales departments do the same job. The only real difference is the cost of everything. Outside of that, the biggest difference is when we do outdoor concerts in the summer on Long Island, the residents of Florida are staying inside, and when we do inside concerts in New York in the fall and winter, we're doing outdoor concerts in Florida. Just reverse the seasons.
You do Dance Top 40 in both markets. How much of that sound consists of EDM artists - or do you think EDM should be a niche format onto itself?
VIC: A misconception started about three to four years ago when Dance music began to reemerge. When it became popular, people started labeling it EDM and our radio stations were on the forefront of it. But it's just popular Dance music now. Today you can turn on almost any Top 40 station and you'll hear EDM records that sound right at home on that format. They're playing hits by Calvin Harris, Aviicii and Zedd-- and even Katy Perry is adding EDM into her sound. The reality is that EDM is the summer's Top 40 - and "EDM" as a label has run its course. What it really is now is simply Top 40 Dance music.
But can the harder-core EDM acts - the House and drum & bass stuff - fit in with mainstream Dance Top 40?
VIC: Absolutely. Look, if I would've taken the latest Martin Garrix record, "Animals," and played it four years ago, people would go, "Oh my God, this record only belongs in the Space Nightclub on South Beach." You'd never hear that on the radio back then. Now you turn on a Top 40 station and odds are that record has been played in power rotation. There is an absolute possibility that today's fringe artists eventually become mainstream; it's more a matter of when, not if.
Does EDM and hip-hop hits mesh well or is there an art to programming them together?
VIC: When you look at a Dance Top 40 station's playlist, it may look a train wreck on a sheet of paper, but keep in mind the versions we are playing are mostly within the same bpm range. So on-air it is a consistent flow between a hip-hop remix and a dance song (ie. Jason Derulo 'Wiggle' into Avicci 'Hey Brother).
Do you see EDM becoming this millennium's disco?
VIC: EDM is very popular right now, but once it reaches a point where it gets so homogenized, you'll see it go back into the underground until the next evolution. You're already seeing EDM going back into rock music; groups like Kings of Leon and Coldplay are adding that rhythm to their music.
Are your stations pushing the envelope in Dance music or are you more into reflecting what's currently popular to your listeners?
VIC: I really feel our Dance properties have been ahead of the curve. As this music becomes more mainstream, I've noticed our stations playing more House music with an intimate feel rather than big room, fat sound you'll hear at an Electric Daisy Carnival. We're playing more feel-good, soulful House music now that I believe will become the core of Dance stations around the country. Once the popularity of the "big room festival" sound starts to taper off, you'll start to hear more sounds like Mr. Probz "Waves" and Route 94 "My Love." Even a big EDM DJ such as deadmau5 has put out new music that doesn't have the big sound with the big synthesizer - which is what made EDM popular over the last few years. He's doing a more soulful 123bpm House music sound (i.e. "Seeya")
Finally, what do you see in your future when it comes to JVC? Could you see it becoming a Townsquare or Alpha with stations across the country, or more like an Emmis, with a handful of stations in selected markets?
JOHN: Our intent is to always be very hands-on operators. We've been successful monetizing our stations while still having operational hands-on control, which means a lot to us. We're not going to get too big, too fast, but we would like to grow more and develop as a radio group.
VIC: We believe that formats featuring good local radio will work anywhere. Our industry really has to get back to the basics and just do radio well - and it always comes down to good content. People ask me all the time if radio is dead, or is the Net taking over, and I say the same thing over and over: Content is king. If you have good content, you're going to have a good radio station. The analogy really is if you want to watch House Of Cards, you've got to have Netflix. If a company just offered good content with interesting programming, it doesn't matter to a listener if they hear it on FM, the Net or satellite. If you do it right, they will listen. We believe the way we program and format our stations will work regardless of where the listeners hear it.