The phenomenon podcasts in the United States, despite maintaining aaudience still very high and growing continuously, it does not get the same results in terms of monetization. Thus, it seems that the production houses no longer want to invest due to the lack of adequate revenues.
In the sector, the case of Spotifywhich proceeded to reduce the budget and the partnerships with i VIP intended for this business.
If in Italy the podcasts is still trying to connote itself as a form of entertainment of the newspaper, in America, after becoming one, is probably suffering a setback. But not from the point of view of appreciation, but of investments.
The data relating to theaudience, in fact, remain high; however they don’t get the monetization they hoped for. This has led to a consequent reduction in advertising investments.
… monetization going downhill
The decline of the latter, as the only source of income of the podcastshad negative consequences on the production of the contents of audio entertainment.
Moves Ostroff sui podcasts
An example is Spotifywhich with the resignation of Dawn Ostroff – hired in 2018 to launch the platform podcasts of theOCT – saw the closure of as many as 12 original show and staff cuts.
Project podcasts at a loss?
THE manager Of Spotify declared, in meetings with industry analysts, that “podcasting was a big drag on our business in 2022”. In fact, the music platform had invested billions of dollars in the conception of the project podcastswhich, however, only generated large losses.
Budget under consideration…
This wave of unprofitable investments – if they can be called that – has not only invested Spotifybut also interested Vox Media, Pushkin Industries, Amazon, SiriusXM, No And Religion of sports.
… and cut
In fact, these companies too have found themselves having to make large cuts in both personnel and budget dedicated to the sector.
Spotify And podcasts
Returning to the phenomenon of Spotifyit is necessary to retrace the evolution of one’s sector podcasts. L’OCT began to believe in the phenomenon in 2016, which it then structured and strengthened more in the two-year period 2017/18.
The master investment
The key investment – equal to 230 million dollars – was made in 2019, the year in which Spotify bought the production house Gimlet medium. In 2020, he paid about $200 million to buy the sportsmedia company by Bill Simons The Ringer.
but theOCT Swedish, in the years when the podcasts seemed to promise huge monetization prospects, he didn’t limit himself to expanding the network by buying exclusively production companies, but he often hired program producers such as Joe Rogan with “The Joe Rogan Experience” (for $200 million) and Alex Cooper with his podcasts “Call her daddy” for about 60 million dollars.
As with motion pictures, the business of the podcasts it should have been based on a multi-channel strategy based on three pillars: advertising, subscriptions and rights to sell licenses in Hollywood.
For this reason the Ostroff (former content and advertising manager of Spotify), to make this grow as much as possible businesshad engaged numerous VIP such as Gigi Hadid, Kerry Washinton, the royal couple Harry and Megan and the Obamas, although these were completely decontextualized from the world ofaudio-entertainment.
Highlight not achieved
Therefore, despite all the techniques of business that the Swedish platform has tried to adopt over the years, the world podcasts he never enjoyed an actual standout moment.
Partly due to the fact that users often opt to listen podcasts usable for free, a bit because it wasn’t yet a mode of entertainment affirmed.
Podcasts did not emerge
Furthermore, Spotify it has not managed, despite all the commercial moves, to make a single one take root and emerge hits among their own originals, making the situation even more difficult. L’OCT it therefore opted for a reduction in advertising sales.
Business plans of the podcasts: revised
All of this escalation of events (not always fruitful) have brought i manager Of Spotify having to review the business of the podcasts already in the spring of 2022, by not renewing the collaboration contracts with the star called – at the time – by Ostroff.
But all this is not a symptom that the world of podcasts is dying, also because both the appreciation of users and the frequent use of theaudio-entertainment.
“the era of dumb money is over”
Even the New York Times tackles this hot topic in the words of the production company’s co-founder podcasts and creative consultancy Magnificent noiseErik Nuzum, who argues that “the era of dumb money is simply over, in which people throw money just to test, to understand if those businesses would quickly scale the audiences. Now everyone is much more cautious and conservative”.
The future of podcasts
Hence, the downsides of the monetization shortage are unburdened by aaudience ever-growing, it’s probably just a matter of re-parameterizing the entire universe podcasts.
Towards a sustainable model
The effective possibilities of producing income, very different from the forecasts formulated five years ago, will have to be re-measured. The sustainability of podcasts it might be the only way forward in order to get the most out of a business “difficult” (GL for NL).