Spotify, the audio streaming platform, said on Tuesday it would not renew its contracts for two critically acclaimed podcasts, “Heavyweight” and “Stolen,” the latest sign that the company is curbing its podcasting ambitions as it struggles to become consistently profitable.
The shows, produced by Gimlet Media, the podcast studio that Spotify acquired in 2019, will conclude their seasons and then have the option to purchase their shows elsewhere.
“We are so proud of the teams who have supported these talented storytellers on each of the incredible episodes of 'Heavyweight' and 'Stolen,'” a Spotify spokeswoman said, adding that the company “will work with the show's creators to ensure a fluid experience.” transition to wherever these series go next.”
“Heavyweight” was hosted by Jonathan Goldstein and for seven seasons delved into the stories that shape people's lives, seeking to help them create better endings. The creators of the program. said on social media“We are very proud of everything we have done and hope the program finds 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 of her late father and his experience and that of hundreds of other indigenous children in the residential school system of Canada.
The decision came 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 consistent profitability. The layoffs and reduction in podcast content come as the tech industry faces the end of a decade of rock-bottom interest rates that fueled its growth.
Media companies have also suffered from a shortage of advertising revenue, partly fueled by tighter advertising budgets and economic anxieties about a possible recession that never came.
Those forces have led some big technology and media companies to maintain their investments in so-called “always on” shows that publish daily or weekly, and reduce their investments in limited or seasonal series, which are harder to make profitable, he said. Nick Quah. , the writer of hotpoda popular podcast newsletter.
“All of this is going on, this economic instability, but the fact of the matter is there are still tons of podcast audiences,” Quah said. “There's an existential way we talk about the podcast industry right now, but audiences have continued to grow.”
TO 2023 report Edison research on podcast consumers found that podcasts have more listeners than ever who are receptive to podcast ads.
About 64 percent of the U.S. population over the age of 12 has listened to a podcast, and about 120 million people in the same demographic had recently listened to a podcast, according to the report.
Spotify, like other technology companies, was primarily driven during the pandemic by the search for potential growth, Quah said.
The company paid $230 million for Gimlet Media in 2019 and about $200 million more for The Ringer, Bill Simmons' sports media company, in 2020. Later that year, as consumers spent even more time listening to podcasts during the pandemic, Amazon bought the popular podcast studio. Wondery podcasts for $300 million, while SiriusXM paid $325 million for the Stitcher platform and publisher.
But then the boom, or at least the apparent potential to capitalize on that boom, faded and Spotify was left with hundreds of millions of dollars in product.
Eric Nuzum, podcast strategist and co-founder of the independent studio Magnificent Noise, said that “Spotify needs to be separated from the rest of the podcast industry” because the company has a different business model with two main sources of revenue: subscriptions and advertising. . And for years, the company was trying to determine which one the podcast was supposed to serve, Nuzum added.
Spotify made those big investments and became “the 800-pound gorilla,” Nuzum said.
It quickly became clear that while much of the tech industry likes to “fail fast” and “act quickly,” that doesn't work with journalism that can take months or years to create and that needs to build an audience or a brand, said Mr. said Nuzum.
Spotify's past decision to keep some podcasts exclusive to the platform — rather than openly available on the Internet and in general podcasting apps — also killed much of the potential to reach and grow audiences, Nuzum said.
Now, Spotify appears to be fine-tuning a strategy they believe will make a podcast successful: bringing in celebrities with built-in fan bases, such as Bruce Springsteen, Barack Obama, Meghan Markle and Joe Rogan, whose deal was said to be valued at more than $200. millions of dollars.
“The problem is that all the money is paid to acquire the talent and not invested in making the product good,” Nuzum said. “And I think they burned over and over again.”
Adam Satariano contributed reports.
