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Audio streaming platform Spotify said Tuesday it will not renew its contracts for two critically acclaimed podcasts, “Heavyweight” and “Stolen,” the latest sign of curbing the company’s podcasting ambitions as it struggles to become increasingly profitable. Is struggling for.
The shows, which are produced by Gimlet Media, the podcast studio Spotify acquired in 2019, will finish their seasons and then have the option to store their shows elsewhere.
A spokesperson for Spotify said, “We are extremely proud of the teams who have supported these talented storytellers throughout each incredible episode of ‘Heavyweight’ and ‘Stolen.’ “Changes for wherever these series go next.”
“Heavyweights” was hosted by Jonathan Goldstein and ran for seven seasons discussing the stories that shape people’s lives, trying to help them build better endings. show creator said on social media“We’re very proud of what we’ve created, and we’re looking forward to the show finding a new home in the future.”
“Stolen,” which received the Pulitzer Prize for audio reporting this year, was created by Connie Walker, a journalist who investigated the life and experience of her late father and hundreds of other Indigenous children in Canada’s residential school system.
The decision comes a day after Spotify announced it would cut nearly a fifth of its workforce, its third round of layoffs so far this year, as it seeks continued profitability. The layoffs and reduction in podcast offerings come as the technology industry struggles with the end of a decade of low interest rates that fueled growth.
Media companies have also faced a lack of advertising revenue, partly driven by reduced advertising budgets and economic concerns about a potential recession that never happened.
Those forces, said Nick Quah, have led some large technology and media companies to maintain their investments in so-called “always on” shows that are published daily or weekly, and to reduce their investments in limited-time or seasonal series. reduce, making it difficult to make profits. Author of HotPod, a popular newsletter about podcasts.
“With all this happening, this economic instability, but the truth is there are still a lot of podcast listeners,” Mr. Quah said. “At this point we’re talking about the podcast industry in an existential way, but the audience continues to grow.”
A 2023 report from Edison Research about podcast consumers found that podcasts have more mainstream listeners than ever before who are receptive to podcast advertisements.
The report found that about 64 percent of the US population over the age of 12 has listened to a podcast, and about 120 million people in the same demographic have recently listened to a podcast.
Like other tech companies, Spotify was primarily driven by the search for potential growth during the pandemic, Mr Quah said.
The company paid $230 million for Gimlet Media in 2019 and nearly $200 million for Bill Simmons’ sports media company The Ringer in 2020. Later that year, as consumers spent even more time listening to podcasts during the pandemic, Amazon bought popular podcast studio Wondery for $300 million, while SiriusXM paid $325 million for the platform and publisher Stitcher.
But then the boom, or at least the apparent ability to capitalize on that boom, faded, and Spotify was left with millions of dollars worth of product.
Podcast strategist and co-founder of independent studio Magnificent Noise Eric Nuzum said that “you have to differentiate Spotify from the rest of the podcast industry” because the company has a different business model with two main revenue streams: subscriptions and advertising. And for years, the company had been trying to figure out which podcasts would provide the service, Mr. Nuzum said.
Spotify made big investments and became an “800-pound gorilla,” Mr. Nuzum said.
It quickly became clear that while most of the tech industry likes to “fail fast” and “move fast”, that doesn’t work with journalism that can take months or years to create, and a Requires building an audience or a brand, sir. Nuzum said.
Spotify’s previous decision to keep some podcasts exclusive to the platform rather than being openly available on the Internet and general podcasting apps also eliminated a lot of potential for reaching and growing an audience, Mr. Nuzum said.
Now, Spotify is pursuing a strategy they believe will make the podcast successful: bringing in celebrities with built-in fan bases like Bruce Springsteen, Barack Obama, Meghan Markle, and Joe Rogan, whose The deal was said to be worth more than $200 million.
“The problem is you pay all the money to get the talent and don’t invest any money in making the product good,” Mr. Nuzum said. “And I think they burned through that time and again and again.”
