Spotify podcast demand is more muted than expected

Spotify’s podcast dreams stall

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The Future. Spotify’s ambition to become a podcasting giant has succeeded… but the empire is smaller than the company hoped. Despite CEO Daniel Ek’s proclamation that the division will be profitable some time next year (and solidify the company’s goal of being an all-audio platform), Spotify may need to recalibrate podcasting’s place in the entertainment ecosystem to make the business truly sustainable.

Tuning out
Spotify’s $1 billion spend to lock down A-list talent and grow its podcast library to over five million shows has scored more listenership than revenue.

  • Although 100 million of its 220 million subscribers listen to its podcasts (10x more than in 2019), most of Spotify’s shows aren’t profitable and have fueled $565 million in losses during the first six months of this year.
  • That’s led to layoffs, a cutback on programming to focus on originals and exclusives, the folding of its Parcast and Gimlet brands, and a change in deal structure (more direct revenue share than pricey buyouts like it’s doing with Trevor Noah).
  • And ad revenue is the golden goose (Spotify makes more from ads than subscriptions), with the company saying podcast ad revenue should grow by 30% this year thanks to the ability to target specific types of listeners instead of specific shows.

Despite podcast revenue in the US expected to hit a record $2.3 billion this year and double by 2025, that’s apparently still too small when considering the overall $200 billion digital ad market. 

In other words, seemingly all the big podcast players — Spotify, Apple, Amazon, Sirius, and iHeart — have all overspent. The ones best positioned for success might be those that make most of their money from something other than podcasts.


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