Putting the Spotify / Rogan Deal Into Context

Welcome to the twentieth Podcast Perspective from the Podglomerate. The podcast industry is thriving, with dozens of news hooks and hot takes coming every day. With Perspectives, we're aiming to shed the podcast ecosystem in a clear, helpful, and hopefully entertaining way by discussing the latest tips, tricks, and trends.

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Heeellllloooooo (read in a Mallory Rubin Binge Mode voice please). I'm back in the LinkedIn Newsletter streets for another installment of the Podcast Perspective.

If you're somehow not sick of me from reading this newsletter, I thought add some links to an interview I did with the Audience Podcast from Castos and to a presentation I gave to the Outlier Podcast Festival on the 5 Tiers of Podcast Audience Development. I'm not a very good presenter, so keep that in mind if you choose to listen to either. Also, if you watch the video, I'm sorry for the mustache.

Enjoy!

Podcasting News & Views:

• Apple News+ is an "immersive magazine and news reading experience" – or what amounts to an aggregator for Apple News to feature hundreds of publishing partners on their reader app behind a paywall. For $9.99 per month (US), users can access more than 300 publications through the service, which has a lot of implications for the publishing partners. As I understand it, publishers are paid based on how much time readers spend on their content. In recent weeks it's come out that Apple News+ is looking to potentially include audio offerings from several of their publishers within the service, which may be a nod to the New York Times purchase of Audm this past March. If you'll recall, Audm had 20,000 paying subscribers at the time of purchase, and the NYT have been implementing the service into their Sunday episodes of The Daily. Personally, I love this feature – especially if there's no additional cost the the subscribers. It dovetails nicely into the growth of the spoken word industry as it applies to audiobooks, audio services, podcasts, and more. We'll see how this affects Apple's publishing partners, though if the revenue share is coming to publishers based on time spent with content, this seems like it will be a beneficial feature. Additionally, there's been talk for a few months of Apple creating original podcast offerings – in part to help promote their Apple TV service. They announced a new executive position on this front right after the Rogan deal was announced, in what may be part of their plan to hold off Spotify's growth.
• Amazon seems to be making some strides into podcasting – Bloomberg published a report about Amazon Music and Amazon's Audible moving into the podcast space. This isn't the first time Audible has dabbled in podcasts, and probably won't be the last. On top of that, Amazon also seems to be looking into more localized content like news and sports. Pair all of this with the distribution of the Amazon Alexa devices, of which there were over 100 million active in January, 2019, and you have a potentially relevant player in the space to join Apple, Spotify, and Google.
• Joe Rogan has been all over the news this week – honestly, just take a moment to think about what it must be like for him right now – but in one of the better pieces of coverage I've seen yet, New York Times opinion writer and two-time Joe Rogan Experience guest (and one time Green Eggs & Dan guest), Bari Weiss interviews Rogan about what it's all been like for him. This is worth the 5 minutes you'll spend reading it. Since Spotify announced their Rogan deal, their market cap has risen about $4.5 billion.

Enjoying Podcast Perspectives? Subscribe to The Podglomerate Newsletter, my weekly email newsletter. Click here to subscribe or connect with me on Twitter.

• A quick check in with the podcast ad market – Veritone One's Hilary Ross was interviewed by Inside Radio earlier this month, generally noting that things have begun to stabilize in the ad space. I was also previously unaware of this, but Ad Results Media, another of the big podcast ad agencies, has a podcast called On the Mic. The show is hosted by Lindsay Boyd, the Director of Traffic and Compliance for ARM. Every couple of weeks her and her team dig into a topic relevant to the podcast advertising world. I don't imagine it's the most thrilling listen, but I've added this to my queue, and you probably should too if you'd like to learn more about this side of the industry.

Podcast Spotlight:

• Monday was Memorial Day, so enjoy this episode of Storybound with Matt Gallagher, Writer's Bone with Elliot Ackerman, and Phil Klay on Writer's Who Don't Write. I've actually had all three on WWDW, but I don't like to surface this show if I can help it.
• I haven't listened, but if anyone was curious, Call Her Daddy returned this week to the world of podcasts that are still publishing episodes. Last week we covered some of the saga, but it looks as if the show will go on as a one woman affair.
• A friend of mine has been trying to get me to read The Disappearing Spoon for years, and now it's become a podcast. I guess it's a history podcast covering every element on the periodic table? Who knows, but I'm sure it's worth a listen.

• Apple Podcasts has a new Cinematic History collection, and the Micheaux Mission is featured prominently in multiple sections. Give it a listen if you'd like to learn more about black film history.

This Week: Putting the Rogan / Spotify Deal Into Context

A lot of people ask me questions about podcasts. Usually it's about what they should listen to next, but when a Blockbuster move happens to be large enough to make a splash in the non-podcast world, they ask me those questions as well. I thought it would be worth putting Rogan's move into context with someone who has seen this happen several times from different fields in the media industry, so I emailed my old friend Matt Silverman.

Matt Silverman is the Director of Video at the Daily Dot and the producer of the weekly Internet culture show 2 GIRLS 1 PODCAST. He's the creator of many webseries (FREE DAD VIDEOS, 5facts, Now I Know), podcasts (The Future Will Not Be Podcast), viral videos, and branded video campaigns for companies large and small. Previously, he was the Editorial Director at Mashable, where he launched many popular series and viral hits.

Jeff Umbro: Who are you and what do you do?

Matt Silverman: My name is Matt Silverman, and I'm a director, producer, and host for a variety of online shows and series. Notably, I'm the director of video at The Daily Dot, a publication that covers Internet culture. That's where I produce 2 GIRLS 1 PODCAST, a weekly comedic interview show about the power of online communities.

JU: What do you think of the Joe Rogan move to Spotify exclusivity?

MS: Rogan's move to Spotify is both surprising and expected.

Rogan is arguably the most important force in podcasting, so I pay close attention to how he built his empire and his relationship to his audience (even though I'm not a regular listener).

The Surprise: Like most podcasts, Rogan's show was platform-agnostic (you can consume it in any pod app, YouTube, etc.). By moving exclusively to Spotify, he is closing the door on a massive audience across the Web. [Editor's Note: the show is currently and historically NOT available on Spotify or Luminary. The show will be available on Spotify for the first time in September, 2020]

The Expected: This is exactly what Spotify is paying for, and it's an incredibly shrewd business move, if Rogan's audience follows him there. I expect the vast majority will, because:

• Rogan's audience is very loyal. Full stop.
• But uniquely in this situation, Spotify already has a massive user-base, and has become the "default" audio platform for many. Even if Rogan's audience isn't happy about the move, they're probably already inside the walled garden.

This has major ramifications for the future of podcasts, which I often cite as a hold-out on the "Open Web." It's also a massive "shots fired" moment for the current audio platform wars.

This battle is now following a familiar blueprint we have observed with other digital content (text, images, and video) over the last 10-15 years:

1. Tech companies create "walled gardens" of content that are incompatible with each other (you can't watch a YouTube video on Facebook)

2. Users grow accustomed to getting content from closed-system apps, rather than the Web, which makes tech companies rich (via advertising) and grants them huge leverage over audiences and creators.

JU: Do you have any examples of comparative 'superstars' who moved to exclusivity and how it's worked for them?

MS: The obvious industry comparison here is Howard Stern moving to SiriusXM. He left behind a universally accessible medium (radio waves) to become the figurehead of a closed broadcast system (satellite radio).

While I'm confident Stern makes a fantastic living and continues to reach millions of listeners, he is no longer part of the wider public discourse. He's more "The King of One Medium" these days.

Some of that is his departure from "shock jock" territory, but a lot of it has to do with the wall he now sits behind.

Similarly, the biggest video game streamer in the world, Richard Blevins (aka Ninja), was reaching 14 million followers and making millions on Twitch, until Microsoft bought his exclusivity.

He used to make daily headlines for breaking records and changing streaming culture. Today, Ninja is very wealthy while streaming to a fraction of his previous audience on Mixer.

Depending on how you view it, these are still huge success stories:

• The talent got a huge pay day and recognition for being the best in their industry
• The platforms got a substantial increase in users which (theoretically?) justified their investment

The only losers here are audiences, who no longer get platform choice, and in some cases lose access to a "free" version of their favorite show.

The Rogan/Spotify deal shares DNA with those examples, but with a massive and important difference. He's not asking you to sign up for a cool new app or pay for a new service. His show will remain free on a platform you're likely already on.

Despite the business win, Rogan will likely pay an "influence" tax here, which he can certainly afford.

There will be listeners who don't follow him, because they prefer other platforms, or listen casually based on the topic or guest. That's an interesting, but likely expendable loss.

However, I expect Rogan -- whose viewpoints and guests regularly make news -- to be harder to cover from a media standpoint, now that he's inside the walled garden.

Previously, if Rogan's show creates controversy or breaks news, it's very visible and accessible.

It's easy for media to embed a YouTube clip or reference a piece of audio from an .mp3. Coverage like this reminds the wider world that Rogan is popular, and that lots of people care what he has to say.

Covering a Spotify episode is harder, less open, and less shareable in many ways. As mentioned earlier, when was the last time you saw a headline about something Howard Stern did or said? Lots of people heard it inside the wall, but media is not pulling clips from SiriusXM to publish wider stories.

And if less people and media are listening across the Web, Rogan becomes inherently less newsworthy.

Does this matter? Likely not.

It changes the shape of Rogan's relationship to mainstream culture, but he will be counting his $100 million while serving his core audience, even if he incrementally fades from public discourse. Whether that matters to him is a personal question.

JU: How would you view this move from Spotify in the context of the 'platform wars'? 

MS: This is a clear victory for Spotify as they move from being the "de facto" music services to the "de facto" podcast platform. If they can afford to buy talent like this (in the way that Disney as been buying the biggest and most important film franchises in recent years: Star Wars, Marvel), then there's little downside.

It's a huge blow to Apple, which used to be the king of podcasting, and a hobbling of Amazon or Google's aspirations to be an audio destination.

JU: Do you have any examples and how is it working for the consumer?

MS: While I'm not a fan of deteriorating consumer choice and letting the Open Web slip away, the biggest instance of a "default" media platform working for both consumer and creators is YouTube.

Throughout its lifespan, Google has made a conscious effort to make its platform monetizeable for creators, allow direct sale advertising, and encourage high quality content. As a result, many people make their entire living as a YouTube creator.

It's not perfect. The vast majority of advertising dollars spent on YouTube flow to the platform, and not the creators. But the massive scale and infrastructure required to serve HD and 4K video to the entire world for free, and  empower creator freedom and loyalty is unprecedented in media, and is an example that other platforms should aspire to.

JU: How about for the publishers?

MS: Despite my disappointment about these shifts, as a creator and member of the publishing industry, it's an uplifting reminder that essential content always wins.

Spotify doesn't make anything. It's just a bunch of code. People listen to Spotify because they love Joe Rogan, or Taylor Swift, or The Beatles. 

While we see tech platforms growing in power, we should take note that they cannot have audiences without the creators themselves, and they will pay big money for content that the world can't live without.

Spotify has the opportunity here to model its platform like YouTube. If it can offer creators and publishers alike the ability to share meaningful revenue from loyal listeners, then there's a healthy way forward.

The fear is that only the whales (like Rogan) will get the pay day, while the vast majority of podcasts squabble over pennies. If audiences treat Spotify as the "de facto" audio platform, and creators/publishers have no where else to go (like YouTube with video), then Spotify has all the leverage.

That could lead to troubling times creators and publishers, similar to the Facebook-publisher meltdowns of the last 5 years, where News Feed traffic was king -- until it was gone.

JU: Do you think the audio space exists in such a way that it can support huge players like Spotify AND smaller players?

MS: Yes, especially if audiences keep caring enough to support creators and publishers in other ways. If a podcast does not want to succumb to Spotify's looming leverage, they can turn to platforms like Patreon and Ko-Fi.

When audiences can't live without your content, they will support you. But only if they are educated, and understand that platforms like YouTube, Facebook and Spotify alone are usually not enough to sustain creators and publishers.

Amazing podcasts and video series are thriving, thanks to direct fan funding. It reduces platform and advertiser influence over the industry.

I hope that kind of open, NPR-style of "pay what you want to support what matters" culture continues as billion-dollar tech companies gobble up everything they can get their hands on.

Matt Silverman is the Director of Video at the Daily Dot and the producer of the weekly Internet culture show 2 GIRLS 1 PODCAST. He's the creator of many webseries (FREE DAD VIDEOS, 5facts, Now I Know), podcasts (The Future Will Not Be Podcast), viral videos, and branded video campaigns for companies large and small. Previously, he was the Editorial Director at Mashable, where he launched many popular series and viral hits.

Jeff Umbro is the Founder and CEO of the Podglomerate, a company that produces, distributes, and monetizes podcasts. Subscribe to The Podglomerate Newsletter by clicking here or connect with me on Twitter.

Thanks for reading—see you next week.