Hey podheads, as I was thinking about the title of this issues, this legendary line from Jerry Maguire came to mind. Kinda makes sense doesn’t it? Issue#24 is all about the money after all. Go forth and read on!
Spotify is getting serious
Of late, not a week goes by without me mentioning Spotify. Anyway, Recode’s Peter Kafka broke the news last week that the company was in talks to acquire Gimlet – the Brooklyn based podcast network. The deal size is estimated to be anywhere between $200 to $220 million, making it the biggest deal in
Before we go any further, it is important to note that deal is not yet done and there is a possibility that it may not happen. Now, let break this down.
Music is a tough business to make money. How tough you ask? Here’s an excerpt from a previous issue of
But the music business is a tough place to survive and it is even tougher to make money. According to Financial Times, Spotify paid ¢79 cents on every dollar to music labels in 2017, an improvement from ¢88 cents it paid in 2015. Given the fact that top 4 labels and groups control about 90% of all music streamed on Spotify, it cannot afford to piss them off.
So, Spotify wants to diversify and it is looking towards to podcasting. Even by share of global music revenues, the top 3 music labels account for over 80% of it. Podcasting still doesn’t have a king of the jungle yet and by Spotify’s estimation – ripe for the taking.
It took a while but Spotify does seem to be getting it podcasting act straight. It is relying on an exclusives driven strategy paired with open distribution. It is a building a slate of originals by signing deals with the likes of Amy Schumer, Joe Budden, and most recently Jemele Hill. With over 200 million users, it has the biggest distribution platform on the planet and now to complete the puzzle – original content creation.
Although this might not be an exact parallel, this does kinda remind me of the movie studios of yore. These hollywood studios were vertically integrated giants that controlled everything from the talent, production, and the distribution. Up until they were broken up, creatives – including actors and directors were like the employees of the studios. If you are interested, this does make for a fascinating study.
Interestingly, in a bid to diversify its revenues Spotify started testing a new direct upload for artists feature, which is in beta. This feature allows independent artists to directly upload their music onto Spotify, thereby bypassing music labels and other middlemen. This move is Spotify encroaching on the turf of music labels.
Founded by Alex Blumberg and Matthew Lieber, Gimlet Media had declared that it wanted to be the “HBO of Audio”. The company had raised $26 million from a clutch of investors including Betaworks and WPP. According to Peter Kafka, it was valued at $70 million during its last round.
Whenever a VC backed company is being acquired, it always begs the inevitable question – were the investors looking for an exit factor into the decision? Your guess is as good as mine.
Oh and loved this thread by Daniel Levine on the topic
Anyway, there is no clarity yet on the business side of the equation and you bet your bottom dollar, that I’ll keep by ear to the ground to bring you any developments.
Ben Mullin and Joe Flint published a piece in the WSJ on The Ringer’s podcasting fortunes. Although the piece is behind a paywall, his Tweet contained some headline numbers:
Not a bad sum of money eh? With 35 million monthly downloads in Q4 2018, The Ringer’s CPMs range between $25 and $50. What’s more? Bill Simmons,
Lucinda Southern wrote a piece in Digiday on the increasing focus of publishers on making money from podcasts. Here are some stand out numbers of The Economist’s podcasting operation in the piece.
Monthly revenue from podcast ads served by platform Acast has increased 50 percent in 2018; that’s across the publisher’s five podcasts that collectively fetched 7 million average monthly listens or downloads.
According to The Economist, its podcast CPMs are higher than YouTube’s network average CPM rates of between $2 (£1.52) and $3 (£2.28), said Tom Standage, head of digital strategy and deputy editor at The Economist.
Making podcasts more accessible
The New York Times last week announced that it would be publishing audio transcripts of its flagship podcast The Daily.
Over the past few months, we’ve been experimenting with ways to make our audio content more accessible to readers. We’re releasing audio transcripts for each new episode of “The Daily,” with transcripts rolling out for other Times podcasts in the future. It’s important to us that all of our readers can engage with our report, whether they choose to listen, share or read, and audio transcripts are a big step forward in our commitment to make Times content accessible to all users.Times Open
Hunter Walk wrote a piece on why podcasters should publish transcripts:
Why do I believe every major podcast should be taking the trouble and cost of creating transcripts for their creations, even if it’s just text without timestamps?
1. Makes sharing key passages/quotes so much easier on social
2. Gives additional SEO data to the pod URL, which hopefully turns into evergreen search traffic, especially for mid/longtail queries
3. Is an additional piece of content to provide related links, show notes, promotional material – a newsletter sign-up. Especially if these promotional links can be dynamically updated across all your episodes’ transcripts, you might have
a interestingmarketing tool to slot into any current campaigns.
Makes sense doesn’t it? If you didn’t read last week’s issue, Google Podcasts also seems to be testing a closed captions features. This essentially allows you read the transcript of the show while you listen to it.
If you are still having difficulty in explaining what a podcast is to your people’s check out this beginner’s guide by The New York Times.
Here’s an interesting piece of news from Panoply.
Panoply Media announced today that its podcasting platform, Megaphone, has officially integrated with Google Campaign Manager. Part of Google Marketing Platform, Campaign Manager helps advertisers and agencies manage digital campaigns across websites and mobile. This includes a robust set of features for ad serving, targeting, verification, and reporting. With this integration, Panoply partners can now validate delivery of podcast ad campaigns in real time through Campaign Manager.
Remember, the company recently made a bold pivot away from content and is completely betting on Megaphone.
Jeff Israely penned an enlightening and timely post titled “2009: The internet is killing (print) journalism. 2019: The internet is killing (internet) journalism.” In the post, he tries to answer the question “Is there really no sustainable form for digital news other than B2B vertical media?”
This comes amidst the steadily increasing drumbeat of shut downs, acquisitions, and layoffs in digital
This at a pivotal moment when radical forces are reshaping the world we know it. At the time when good journalism is most needed, we are instead seeing a mounting death toll of publishers around the world, most importantly local news outlets.
Here’s some brutal truth from Dan Primack of Axios:
2/ Media isn’t software. Doesn’t scale the same, even in best case scenario. So it shouldn’t be treated like software. Same goes for mattress startups and food startups, etc, etc.— Dan Primack (@danprimack) February 1, 2019
Losing a job never feels good. I can’t say that I empathise with the reporters who’ve lost their jobs. The craziest thing I’ve ever done is to quit my job twice to pursue my dreams which predictably ended like a plane crash. If you are wondering what it must feel like, Emily Tamkin who was laid-off from Buzzfeed last month published a diary.