Spotify is catching up with broadcast companies in investing big on podcasts

Spotify has a plan and doesn’t just go by the music. Instead, focus on the new podcast season . It is curious that today we are talking about a communication channel already so rooted: just think that “podcasting” was elected word of the year by the American dictionary New Oxford back in 2005. Almost 15 years ago. And there is no doubt that with this term we were referring to the same fever that we are experiencing in these months, that is to a “digital recording of a radio broadcast or similar, made available on the internet with the purpose of allowing the download on audio players personal. ” Today we do everything with the smartphone, at the time there were (also) mp3 players and PC software, but the substance does not change. What has changed is the ecosystem that revolves around it.

This is why Spotify, which currently has 96 million paid subscribers and 207 million active users per month, wants to develop a more effective strategy with the aim of making podcasts a new (serious) income. Last year an analysis by IAB and PwCestimated that the turnover around this liquid formula of ubiquitous radio would reach 659 million dollars by 2020 only in the United States. But order must be made: today podcast listening is fragmented on several fronts, from TuneIn Radio to Apple’s Podcast app, through Spotify, Audible and other applications like Stitcher, Spreaker, Podbean and Overcast. Not to mention the applications set up by the individual radio-TV networks, like our RaiPlayRadio.

In truth, the group of Daniel Ek has already taken the first steps by acquiring two companies, which will remain independent, but will have to bring water to the mother platform. It is Gimlet Media , specialized in the production of original content, and Anchor , a simple-to-use app to make a podcast in just a few taps. The bill is 300 million dollars and both companies tell their respective strategies for the coming months: original content with which to attract the Netflix-style audience , and at the same time open to content from below by enthusiasts and creators. In short, a pincer action to understand which approach will pull more in a mix between professionalism and amateurism.

The preparatory step, however, will be the development of more effective algorithms to allow users to easily discover the podcasts and authors that might interest them. This is exactly what happens with music with Discover Weekly- style playlists , tailored to the user’s previous tastes and ratings. The same will happen soon with podcasts: “The music that we offer through our discovery engine and which we select through machine learning is damn good, and you know what? The group is working on the same thing for podcasts, “explained Courtney Holt, Spotify studio and video manager, at a recent Festival in Brooklyn.

But if I do not know what to listen to and the hunt for the podcast becomes too complex or boring, I will tend to always hear only a few, limiting the attitude of discovery typical of streaming platforms. Ek has also returned to this point; the goal is to focus on the user experience to become the reference platform for anyone who wants to listen to their favorite creators. “We believe there is enormous potential for improving the user experience – explained the CEO – and if we do we will have the opportunity to increase our market share for podcasts”.

This is why Spotify “will double its investments on original and exclusive content”, as the head of finance, Barry McCarthy, assured and confirmed Gimlet co-founder Alex Blumberg. According to Holt, among other things, Gimlet and other possible acquisitions will be at Spotify a bit like Pixar and Marvel are at Disney. Expectations, therefore, are not lacking. The contents, however, will not only come from professionals. The acquisition of Anchor, a very fun application to churn out their podcasts in just a few steps, paves the way for individual creation, an aspect to which Spotify has never looked carefully.

Difficult to understand which content will work the most: whether the shows produced from below or the Spotify Original. The decision, by McCarthy’s own admission, seems to be to focus on both fronts. It remains to understand the business model to apply to those who will sign these contents. That is how much and how they will gain.


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