Podstruck #7:  May 2021 in Podcasting

By Dan Hart

Welcome to Podstruck’s May 2021 month in review where Podstruck curates and analyzes podcast industry events and trends. 

This May review includes:

  • News from Big Media

  • News and Notes on the major podcast industry players

  • Additional Podcast and Podcast Adjacent News

  • Final Ramblings


News from Broader Media

Several May 2021 big media stories had relevance to podcasting:

  • WarnerMedia’s HBO Max adds a cheaper subscription plan ($9.99 vs. $14.99) augmented with advertising;  The “with ads” plan fits in as a competitor to various other AVOD products like Hulu with ads, or NBC’s Peacock Premium with Ads.  Its also a path to customer acquisition and upgrade, and a downgrade option to reduce churn. WarnerMedia contends that the margins on the ad supported tier will match the margins on full premium. 

    Assuming a $20 cpm, an average ad supported sub would have to view 250 ads per month to make up the $5.  Margins then remain constant assuming other operational costs cancel eachother out.

  • This Map of the 2021 Media Universe via Evan Shapiro - @eshap - has been making the rounds.  Well done with key data and perspective on size/influence. Some of the audio universe is included - the map shows it in bright orange.


News and Notes on the Big Podcast Players

A group of Podcast Industry frontrunners has emerged through growth/ consolidation.  The top dogs according to Podstruck are: 

*Spotify*  *Apple*  *iHeart*  *Audacy*  *SiriusXM*  *Amazon*

Here is an Airtable showing “Who Owns Who in Podcasting” by @evoterra

You can find the frontrunners among their public company peers in Podstruck’s Public Audio Market Tracker.  

Facebook may join the list pending the success of its recently announced audio initiatives including Clubhouse-like Facebook Live Audio, and Facebook’s podcast distribution plans both with Spotify’s in-app player, and on its own.

Industry momentum heading into May was dominated by Spotify and Apple announcing their podcast subscription plans in late April:

In truth, Podcast subscriptions have been around for a long time, and podcasters don’t need Apple or Spotify to offer subscriptions. PatreonSupporting Cast, Supercast and others have enabled podcasters to easily offer paywalled podcasts with private RSS feeds.  Wondery, Slate, and Cafe, for example, have had subscription plans for years.   

The promise is that Apple and Spotify can make podcast subscriptions mainstream by removing friction from current user upgrade flows, granting legitimacy to the subscription model with their brands, and marketing premium podcasts front and center to the bulk of podcast listeners.  This could create a rising tide that finally makes consumer payments a legitimate second revenue stream for podcasters of all sizes. 

May 2021 News by Company:

Spotify

  • Spotify rolled out some features:  

Apple

iHeart

  • iHeart reports that iHeart Radio has surpassed 150M registered users (cumulative # -- not monthly active users). IHeart converted these registrations from 3 Billion app downloads.  Following the math, that’s one registered user per 20 downloads.  Many of those downloads are the result of user phone upgrades as the iHeart radio app has been in the App store for over a decade.  iHeart also claimed a total social audience of 234 million without going into specifics of how/where.

SiriusXM

Audacy (formerly Entercom)

Amazon

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Additional Podcast and Podcast Adjacent News

Companies/Deals

  • “Social Voice” maverick Clubhouse launched in Android but continues to lose momentum as iPhone downloads dropped precipitously from over 9 million in February to under 1 million in April (according to Business Insider). Clubhouse recently raised more capital at a $4 Billion valuation. The company is now in a race to keep and grow users. 

    Clubhouse must offer something unique - either content/features or function to stem the attrition as it quickly competes with:  Twitter (Spaces), Facebook (Live Audio), Discord (Stage Discovery), audio chat, Reddit, Slack, LinkedIn, and others large and small.

Advertising/Marketing

  • BetterHelp continued its dominance of the top Podcast Advertiser slot in April 2021’s top spenders from Magellan AI.The biggest mover was Samsung which went from zero to $1.42M in monthly spend.    Click here for the full top 15 lists.

  • Around the Upfronts, the IAB released confirmation of 2020’s podcast advertising growth from (iab.com).  There was $842M in 2020 Industry Ad Spending vs. $708M in 2019.  Podcasts ads are headed to well over $1B in 2021.  

    • While steady, double digit growth, it is linear vs. exponential.  At some point innovation, volume and marketer acceptance will accelerate spend.  The IAB report forecasts a jump to $2B in 2023 which would start to justify the investment and enthusiasm the big players have been showing.

Podcasts/Content News

  • Podchaser released an API that lets developers pull Podchaser content and metadata into their applications.  

    • Podchaser raised $4M in January 2021 to build a third party discovery platform for podcasts. It offers a directory with metadata that aims to be as complete for podcasts as IMDB is for films.  

    • In addition Podchaser offers a profile based social sharing network so people can see what others recommend. 

    • The syndicated data includes “ratings & reviews, over 11 million creator & guest credits, user-curated playlists created for every niche, top podcast charts*, audience size & demographics*, and so much more!” according to Podchaser.

    • You can see my “top 8” and who I’m following here.

Final Ramblings - Podcasting within a Media Perspective

We break down the Podcast ecosystem along the following lines:

  1. Context within the overall Tech and Entertainment Industry Economics.

  2. Context within the overall audio, voice, and artificial intelligence industries.  

  3. The leadership and influence of the Big Players on the ecosystem.

  4. The innovation and leadership of companies of all sizes below the top layer.

Podcasting sits broadly within the context of the overall media industry, and more narrowly within audio. 

In general, big companies focus on scaled growth, feature matching, and activities that exploit their leverage, while smaller companies focus on innovation and all manner of growth. Big companies that can execute successfully in both ways become true market leaders.

So what is the best analog for podcasting in big media ecosystem?

For now, the best analogy for development of the podcasting ecosystem is OTT streamed video.  The comparison carries along these lines:

  • The podcasting and internet video streaming ecosystems have enabled anyone to create, aggregate, and broadcast content globally at a minimal cost. 

  • Just as the OTT video business is an evolution of traditional broadcast & cable, and movies; podcasting and on-demand audio is an evolution of broadcast radio, recorded music and audiobooks;

  • While repurposing of content is valuable, technology and consumption patterns created by streaming/on demand media have deeply influenced and changed creative formats for both video and audio.  

    • Podcasting is a prime example of this, and, clearly there is a lot of connective tissue between OTT video streaming and podcasting when looking at YouTube.

  • Streaming and On-demand has expanded funding for a much broader variety of creative projects taking bigger risks and serving smaller niche audiences.

  • Video and audio business models center on both advertising/sponsorship and consumer payment  models.

There are lessons to be learned by comparing and contrasting audio and video business models and following consumer behavior in the more economically mature market. At some point we may even see premium audio and video products converge. 

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About Podstruck

Podstruck aims to inform decision making for media executives, independent podcasters and everyone in between as we all grow the industry.  Podstruck provides consulting and advisory services to audio and media industry clients.  More information at www.podstruck.com.