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The state of podcasting
In this third and final part of my audio vs text series, I examine where podcasts fit into the cultural content landscape. The thesis of this series is that audio formats, such as podcasting and audiobooks, have in some ways replaced textual formats like blogs and print books. Text content is certainly not dead, of course, but both podcasting and audiobooks are growing rapidly in popularity. Audio is also becoming more and more suitable for key content consumption use cases, like the daily commute or your regular workout.
In this article, we’ll take a look at the distribution dynamics of podcasting (increasingly a battle between Apple and Spotify, with Google doing some flexing too), how the podcast content market is shaping up, and finally the latest revenue statistics. Let’s get to it…
The Big Players
Podcasting has entered into a golden age this year. When I launched Cybercultural in May, I started with a post about Spotify and Google’s expansionary moves into the podcasting market.
Spotify had announced its intentions to rapidly expand into podcasting back in February, when it acquired several podcast companies - including the podcast network Gimlet Media - for around $400 million. As I noted in May, this marked a clear strategic shift for Spotify:
Founding CEO Daniel Ek wrote in his blog post announcing the Gimlet news that Spotify would be “audio-first” going forward – meaning not just music anymore.
Spotify followed up with a redesign of its app to highlight podcasts in June, and then took its Spotify for Podcasters dashboard out of beta in August. The latest feature article in its newsroom, as I write this, is How to Make Your Own Podcast Playlists.
Clearly the company is committed to turning at least some of its vast audience of music fans into podcast listeners too. As I noted in May, Spotify sees podcasts as an alternative to radio for its users. Podcasts are a way to “deepen engagement” with the Spotify app, as Daniel Ek put it.
Google has also been making moves to emphasize podcasts in its core search product. In May, Google announced it would begin indexing podcasts and allowing people to play episodes from within its search engine, via a new browser-based version of Google Podcasts (previously only available on Android phones and Google Assistant devices).
In August, Google expanded this feature to surface individual podcast episodes in search results. This meant if you searched for a niche topic or an interview with a specific person, Google would now show you potential podcast episodes that fit that query. In addition, you could now ask Google Assistant to play podcasts about a specific topic.
The sleeping giant of podcasting though is Apple, which somehow still dominates podcasting with its ancient and creaky iTunes app. It currently accounts for anywhere from 50% to 70% of listening for most podcasts, according to Bloomberg sources.
It may have been asleep at the podcasting wheel for the past several years, but Apple has been rudely awoken by the recent moves of Spotify and Google. In June, Apple (finally) announced the retirement of iTunes in the next version of Apple’s MacOS software, nicknamed Catalina. In its place would be three separate apps: Music, TV and Podcasts. While Apple has had a separate podcast app on iOS for years, iTunes had remained the primary interface for podcasts (many podcasters end their shows by imploring listeners to “leave a 5-star review” on iTunes). But as of Catalina, which has just been released this week, iTunes will disappear.
Apple needs to do more though, to show it is as committed to podcasting as Spotify and Google. All we’ve heard from the company so far this year, other than the replacement of iTunes, is that it plans to fund some original podcasts. It’s not enough, and it’s hard to believe Apple will allow Spotify to slowly take over the podcasting market. So I fully expect more Apple podcasting announcements soon.
Golden age for podcast content
If the new landscape for podcast distribution is still being worked out, we know for sure there’s no shortage of premium content to choose from. Back in June I highlighted one of my favourite podcasts of the year, The Chernobyl Podcast. I thought the podcast was an excellent deep dive companion to the tv show:
I found The Chernobyl Podcast to be almost as as compelling and binge-worthy as the tv show. The creator and writer, [Craig] Mazin, does most of the talking in the podcast. I learned many interesting background details from him, about both the production of the show and the Chernobyl disaster itself. As for [Peter] Sagal, he does a sterling job as host - making sure to hit all the main talking points and adding his own interpretations and theories.
Often the best podcasts follow this discussion format, with two or more people talking about a topic they’re passionate about. It can be about cultural content, such as a tv show or type of music, but it can also be about more esoteric subjects. A good example of the latter is The Art of Process, a podcast co-hosted by singer-songwriters Aimee Mann and Ted Leo. The pair’s goal is to “talk to friends across the creative spectrum to find out how they work.” A recent episode I enjoyed was with the tv critic Emily Nussbaum.
But just like blogs, successful podcasts can also be created by a single, spirited individual. Earlier this year I interviewed Doug Metzger from the Literature and History podcast, who has created a passion project that features over 100 hours of audio (and he’s nowhere near finished). The show is a history of literature, starting from the Tower of Babel origin myth and continuing on through Ancient Greece and much more. Each episode features textual readings, analysis, historical context, and Metzger’s endearingly goofy brand of humor. I don’t know how he produces this all by himself, but regardless it’s clear that podcasting is the ideal format for Metzger’s talents.
A more business-focused single podcaster is Brian McCullough, creator of the Internet History Podcast and more recently the Techmeme Ride Home. The latter has enabled McCullough to become a self-described “professional podcaster.” Indeed, by his account he’s making a great living via advertising on the Techmeme Ride Home, a daily podcast that complements the popular tech news aggregator Techmeme.
There’s no doubt in my mind this is a golden age for podcast content. It reminds me of when blogging became professional, around 2005-06. That was when I started running adverts on ReadWriteWeb, the tech blog I founded. At the time, 2005-06, blogs had just become popular enough to attract advertisers and sponsors, who wanted to reach the fast-growing audience that bloggers like me were gaining. It was also before social media came onto the scene, so it felt like blogging was the ideal format for niche content - where a mix of professional-level talent and amateur enthusiasm seems to work best.
Likewise, the best podcasts are often a mix of passion and professionalism. Yes, there are some slickly produced media podcasts, like the public radio backed Serial and S-Town, but for every one of those there are ten or more passion projects from individuals or small groups that are well worth listening to. And, again like blogs in 2005-06, advertising revenue opportunities are growing fast for all concerned.
The US podcasting industry pulled in an estimated $479.1 million in revenue in 2018 and is expected to produce more than $1 billion by 2021, according to a report this year from the Interactive Advertising Bureau (IAB) and PwC (via The Verge). That figure was up from US$314 million a year earlier, so revenue is both growing and still relatively small.
Even when podcasting industry revenue goes over $1 billion, it will still trail far behind radio. The US radio industry earned US$22.1 billion in 2017. Of course there will be some crossover, since some radio content is also adapted into podcasts. But clearly the likes of Spotify and Apple see an opportunity to siphon off some of that massive radio revenue onto their podcasting platforms.
Who’ll be the next Gimlet?
Whenever we start talking about a golden age in a cultural content sector, inevitably the talk turns to whether we’ve reached “peak” x or y. Peak podcasting is a phrase that is as common now as peak tv. But for podcasting at least, it seems like there is still a ways to climb until we reach the peak.
The revenue numbers are the first indicator that we’re not at peak. Almost half a billion in podcasting versus the $22 billion that radio pulls in each year? That is an obvious market opportunity, especially for the big platforms like Spotify, Apple and Google. Daniel Ek is right, there’s a huge opportunity there for people to spend more time in their Spotify apps every day - rather than twiddling with dials on a radio. Radio networks will adapt too, of course, but even a small slice of that $22B is tantalising for podcast networks.
I also wonder if there’s still more to come for content networks like Gimlet. It wasn’t until after the initial wave of professional blogs (which included ReadWriteWeb) that we saw newer, often massively funded, companies like Buzzfeed and Vox Media emerge to take large slices of the blogging revenue pie. Not to mention older internet media companies like AOL taking their opportunities well, with purchases of the likes of Huffington Post and Techcrunch. I wonder who will be the next Gimlets, and which platform or legacy media companies will snap them up - before the gold rush is over.
As for the consumer point of view, podcasts are far from over.