Spotify, the audio streaming platform, stated on Tuesday that it will not renew its contracts for 2 critically acclaimed podcasts, “Heavyweight” and “Stolen,” the most recent signal of the corporate curbing its podcasting ambitions because it struggles to turn into persistently worthwhile.
The reveals, that are produced by Gimlet Media, the podcast studio Spotify acquired in 2019, will conclude their seasons after which have the choice to buy their reveals elsewhere.
“We’re extraordinarily pleased with the groups who’ve supported these gifted storytellers throughout every of the unbelievable episodes of ‘Heavyweight’ and ‘Stolen,’” a Spotify spokeswoman stated, including that the corporate will “work with the present creators to make sure a easy transition for wherever these collection go subsequent.”
“Heavyweight” was hosted by Jonathan Goldstein and for seven seasons delved into the tales that form individuals’s lives, in search of to assist them create higher endings. The present’s creators stated on social media, “We’re so pleased with the whole lot we’ve made, and we’re hoping the present finds a brand new dwelling sooner or later.”
“Stolen,” which obtained the Pulitzer Prize for audio reporting this yr, was created by Connie Walker, a journalist who investigated her late father’s life and his expertise and that of a whole bunch of different Indigenous youngsters in Canada’s residential college system.
The choice got here a day after Spotify introduced that it will lower practically a fifth of its work power, its third spherical of layoffs to date this yr, because it seeks constant profitability. The layoffs and curbing of podcast content material come because the expertise trade reckons with the tip of a decade of rock-bottom rates of interest that propelled its progress.
Media corporations have additionally suffered from a shortfall of promoting income, partly fueled by leaner promoting budgets and financial anxieties a couple of potential recession that by no means fairly occurred.
These forces have led some massive expertise and media corporations to keep up their investments in so-called “all the time on” reveals that publish each day or weekly, and scale back their investments in restricted run or seasonal collection, that are more durable to make worthwhile, stated Nick Quah, the author of HotPod, a well-liked e-newsletter about podcasts.
“All of that is taking place, this financial instability, however the reality of the matter is, there’s nonetheless tons of podcast audiences,” Mr. Quah stated. “There’s an existential manner wherein we’re speaking concerning the podcast trade at this level, however audiences have continued to develop.”
A 2023 report from Edison analysis about podcast customers discovered that podcasts have extra mainstream listeners than ever who’re receptive to podcast adverts.
About 64 % of the U.S. inhabitants older than 12 years previous have listened to a podcast, and roughly 120 million individuals in the identical demographic had just lately listened to a podcast, the report discovered.
Spotify, like different tech corporations, was principally pushed through the pandemic by the pursuit of potential progress, Mr. Quah stated.
The corporate paid $230 million for Gimlet Media in 2019 and round $200 million extra for The Ringer, Invoice Simmons’s sports activities media firm, in 2020. Later that yr, as customers spent much more time listening to podcasts through the pandemic, Amazon purchased the favored podcast studio Wondery for $300 million, whereas SiriusXM paid $325 million for the platform and writer Stitcher.
However then the increase, or a minimum of the obvious potential to capitalize on that increase, pale, and Spotify was left with a whole bunch of tens of millions of {dollars} price of product.
Eric Nuzum, a podcast strategist and co-founder of the unbiased studio Magnificent Noise, stated that “you need to separate Spotify away from the remainder of the podcast trade” as a result of the corporate has a unique enterprise mannequin with two most important income streams: subscriptions and promoting. And for years, the corporate was making an attempt to determine which one podcasting was presupposed to serve, Mr. Nuzum added.
Spotify made these large investments and have become “the 800-pound gorilla,” Mr. Nuzum stated.
It shortly grew to become clear that whereas a lot of the tech trade likes to “fail quick” and “transfer shortly,” that doesn’t work with journalism that may take months or years to create, and must construct an viewers or model, Mr. Nuzum stated.
Spotify’s previous resolution to maintain some podcasts unique on the platform — relatively than overtly accessible on the web and basic podcasting apps — additionally killed a lot of the potential for reaching and rising audiences, Mr. Nuzum stated.
Now, Spotify seems to be honing in on a method that they consider will make a podcast profitable: bringing in celebrities with built-in fan bases, corresponding to Bruce Springsteen, Barack Obama, Meghan Markle and Joe Rogan, whose deal was stated to be price greater than $200 million.
“The issue is you pay all the cash to accumulate the expertise and put no funding into making the product good,” Mr. Nuzum stated. “And I feel that they bought burned by that point and time and time once more.”
Adam Satariano contributed reporting.
