Sounds Profitable

ICYMI: Warner Music launches a podcast network, Spotify weathers the storm, and personnel changes at Edison Research.

Warner Music Group is dipping its toes into podcasting with its first network: Interval Presents. The new network’s slate promises a variety of content lead by popular musicians and celebrities who work with WMG. 

“The initiative marks the first major music label to follow in Sony Music’s lead; Sony entered the podcast arena five years ago in May, 2017.”

WMG Senior VP of Digital Strategy & Business Development Allan Coye has stepped into the role of General Manager of Interval Presents content. CDO and EVP of Business Development Oana Ruxandra set the tone for what Interval Presents intends to accomplish. 

She says, “There’s a hunger for more inclusive and authentic podcast content and, with Allan leading the charge, we’re thrilled to launch an audio platform that will connect with this growing audience and spotlight a breadth of voices and perspectives.”

While this might initially look like simply another company jumping into the field of celebrity podcasts, that itself is enough to help grow the industry. With more celebrity-hosted podcasts comes a higher chance of graduating those who only listen to music into full-fledged podcast listeners who seek out content beyond their initial introduction, be it with a Jason Derulo-hosted fiction podcast or a Lupita Nyong’o series on African diaspora.

---

This week Spotify’s Q1 numbers became the subject of much discussion as they became public. On Wednesday Bloomberg’s Ashley Carman published “Spotify Tumbles as Investors Question Podcast Investments.” 

“Spotify Technology SA has spent more than a billion dollars in an effort to become the No. 1 name in podcasting, but investors’ patience is wearing thin on how much that will cost.” 

Carman’s article paints a cloudy sky for the big green dot with investors getting antsy at the amount of money invested in podcasting intended for long-term growth over short-term returns, including a gross margin of 25.2% that falls short of the 30 to 40% target. That said, both paid subscriptions and unpaid ad-supported users are up despite locking out Russian users and much-publicized Joe Rogan backlash. Sarah Perez writes for a TechCrunch article on the same subject this Wednesday:

“Despite losing 1.5 million users in Russia, Spotify’s premium subscribers grew 15% year-over-year in the first quarter to reach 182 million, largely in line with analyst estimates. Ad-supported users, meanwhile, grew 21% to reach 252 million.”

The #deletespotify movement, sparked by a transphobic conversation in his latest Jordan Peterson interview, a history of COVID-19 disinformation, and a compilation of him saying a racial slur lead to musicians and podcasters alike pulling their content from Spotify or threatening to cancel contracts. As Sarah Perez reports: 

“But app store data at the time indicated rival streaming apps were not getting a boost from this latest PR headache, as Spotify’s app had continued to see millions of weekly downloads — a significantly larger figure than its nearest rivals — even amid the #deletespotify campaign on social media.”

That lack of attention to rival apps likely stings especially hard for Neil Young, a figurehead of the Rogan backlash who pulled all of his music from Spotify in protest of Rogan’s COVID disinformation. Young, a vocal critic of low-quality MP3 streaming on services like Spotify, also happened to be releasing high-quality versions of his discography on Amazon Music shortly after the much-publicized stunt. 

As with all things, Spotify’s growth remains a complicated beast. Subscribers are up, stock value is down, all while successfully weathering a weeks-long PR storm.

---

Last Thursday Spotify dropped an article on their official blog announcing Spotify’s big entrance into video podcasting. 

Quoting the article, “Last fall, Spotify began activating Video Podcasts for creators on a limited basis. Since then, we’ve found that podcasters love having the option to accompany their audio with visual components, and fans love having the opportunity to more deeply connect with the content.”

As of Thursday creators in the US, Canada, New Zealand, Australia, and the UK gained access to the feature, as well as a handful of new features to help the transition for video podcasters with backlogs. The new system requires a podcast be hosted on Spotify’s service Anchor, meaning any existing video podcasts interested in trying out the service will either need to make a Spotify spinoff feed or wholesale transfer from their existing service to take advantage of this new feature. 

Once integrated into Spotify the video podcasting appears to function identical to simply watching a video podcast on YouTube, with those who prefer pure audio able to leave the app or lock their phone to background the video. 

Video in podcasting challenges an open ecosystem to consider themselves creators, agnostic of any one medium, while also pushing them into siloed solutions. Podcast-first creators exploring video as a channel is powerful, even if the current options dead-end into proprietary solutions. Spotify’s requirement that a show must be hosted on their own service. Anyone currently producing videos with their podcasts have to weigh the pros and cons of porting everything over into Spotify’s silo purely to have one more place to upload the same video content already going up on YouTube and social media.

There’s promise in the concept of podcasts-with-video, but current offerings are lacking as they all appear to exist to push an open podcasting world into producing siloed content. 

---

And finally, while we don't often cover personnel changes here on The Download, this one is important enough that we mention. Tom Webster has just today announced that he is leaving his position with Edison Research. But Tom and Edison will both still be with us in the podcasting industry. As Tom says in his newsletter, I Hear Things:

"My work with Edison is far from over, and we have established an agreement to partner on many things in the future."

So what will Tom be doing with his time? That's not been announced just yet, but again quoting from today's newsletter:

"I want to continue to work to establish a podcast industry: a place where established networks and independent podcasters alike have fair access to information, revenue, and opportunity. I think there are some structural issues in podcasting, and a some information arbitrage, as well. I want to work on both of these issues, and help to create the sandbox I wish to continue to play in for years to come.

I'm excited about what is next, and I'll have more to say on that in the next edition of I Hear Things, which isn't going away, by the way. Just as I am doubling down on podcasting, I am also going to be evolving I Hear Things into something very exciting, broad-reaching, and ultimately useful for podcasters of every stripe."

The podcast industry might be grateful for everything Tom has done at Edison Research to grow the platform, but I’m personally grateful for everything Tom has done for me. See what you may not know is that I have worked closely with Tom for five years at Edison Research. Now he’s said before that he wishes he could have been a better mentor, but to him I say: you did an incredible job. Clearly, your wisdom is invaluable and I’ve absorbed a lot, but it is your confidence in my abilities that has allowed me to face challenges I didn’t think I was capable of facing. Suggesting I take the lead on presenting research for the first time or asking for my advice as if I were the expert served as ammo to fight off my imposter syndrome. As you did for much of the podcast industry, you opened doors for me to bring my own passion projects to life, my own research on Latino and Black podcast audiences. You helped me evolve from a project coordinator to a Director of Research, and listen to me now, a host of a podcast. I don’t think there’s a better way to say that I’m forever grateful than on audio that will forever live in the world you’ve helped build. Thank you for everything.

----

The Download is a production of Sounds Profitable. Today's episode was hosted by Gabriel Soto and Manuela Bedoya, and the script was written by Gavin Gaddis.

Bryan Barletta and Evo Terra are the executive producers of The Download from Sounds Profitable.

Special thanks to Ian Powell for his audio prowess, and to our media host, Omny Studio.

See omnystudio.com/listener for privacy information.

See omnystudio.com/listener for privacy information.