Disclosure: it’s (basically) all Spotify news today. The company has a lot going on, from finally closing the deal on audiobook platform Findaway to scaling back its hiring in the face of recession to Ringer head Bill Simmons saying something on the record he probably shouldn’t have. Let’s get into it!
Bill Simmons says Spotify’s advantage is all about data
In a wide-ranging interview with Recode’s Peter Kafka this week, Bill Simmons went into detail about life at Spotify. One thing he mentioned in the podcast that stood out to me was how he uses data. Although he said that he does not pay too much attention to his own shows’ performance metrics, he indicated that he takes advantage of Spotify’s other data resources to scope out the competition and better position his shows.
On Kafka’s podcast, Simmons said (starting at 35:38): “One of the reasons we wanted to go to Spotify was they have an incredible war chest of intelligence on the habits of people who listen to podcasts, right? So if we like a certain podcast, we can actually go and see, you know, how many people are listening to it. If we feel like there’s a piece of kind of turf available, then that can inform — like who’s in that turf, who’s doing well, can we beat this, can we have a bigger audience than this.”
He did not spell out which specific data sources he uses to look at other podcasts — whether that’s internal information from Megaphone or external data sources like Podtrac. When reached for comment, Spotify spokesperson Rosa Oh said that Simmons was referring to data available through Spotify for Podcasters. But it appears that Spotify for Podcasters’ detailed demographic data, which shows listener distribution of gender, age, and location, is limited to one’s own podcast and does not give similar insight into other (possibly competing) shows.
Simmons, who sold The Ringer to Spotify in 2020 and was recently promoted to a role that will oversee the streamer’s global sports talk strategy, is clearly thinking like an executive. He said that part of why he sold his company to Spotify for $250 million was because it would allow The Ringer to grow. When it comes to data, he made the right bet. Since the sale, Spotify has acquired podcast tech that gives the company greater data analytics capabilities, like Megaphone, Podsights, and Chartable.
Even if Simmons doesn’t have access to those sources of information, his remarks still provide insight into why podcasters have been flocking to the streamer. The nine-figure pay days don’t hurt, but neither does the home team advantage. Whether podcasters who distribute on Spotify but whose shows are not owned or licensed by Spotify are okay with this is another story.
Spotify closes the deal with audiobook company Findaway
Spotify can finally hit the ground running on its audiobook ambitions now that, six months after it was announced, it has closed on the purchase of Findaway. Terms of the deal were not disclosed, and Spotify has not yet revealed when the audiobook vertical will debut on the app.
Ohio-based Findaway is not dissimilar from Anchor, which allows creators to upload and distribute their podcasts. While most people think of audiobooks as the domain of top authors, Findaway enables amateur authors to create, distribute, and monetize their work.
Spotify is banking on the idea that audiobook creation will be as popular and accessible as it is for podcasts and plans to offer at least some audiobooks for free (of course, with ads). As I wrote last week, this new model could have major ramifications for the publishing industry. Although introducing audiobooks to Spotify’s 182 million subscribers could boost the audiobook market as a whole, the pricing structure could eat into publishers’ and authors’ profits.
Spotify to scale back hiring by 25 percent
On Wednesday, Bloomberg reported that Spotify CEO Daniel Ek sent a memo to employees saying that the company would pare down its hiring by 25 percent as recession fears mount. It’s a sharp tonal change from last week’s investor presentation, where Ek emphasized the company’s growth. However, at the same event, Spotify chief financial officer Paul Vogel did warn that such a thing could happen.
“We are clearly aware of the increasing uncertainty regarding the global economy,” Vogel said. “And while we have yet to see any material impact to our business, we are keeping a close eye on the situation and evaluating our headcount growth in the near term.”
When it comes to hiring slowdowns in tech, Spotify is far from alone. Twitter and Meta each announced some degree of hiring freeze last month, and Netflix made headlines in April for its layoffs, particularly at in-house fan site Tudum.
It is unclear which parts of the company will be most affected by the hiring slowdown. As of the end of 2021, Spotify employed more than 6,600 people. The company still lists 557 job openings on its careers page, but we’ll keep an eye out to see if that figure dwindles.
Moves: SoundCloud hires executive from Twitch to lead creators division
On Wednesday, SoundCloud announced that it has hired Twitch and Spotify alum Tracy Chan as its senior vice president of creators. Chan, who spent the last two years as head of music at Twitch, will oversee SoundCloud’s services, products, and tools for artists who distribute their music on the platform.
SoundCloud has been making moves to up its tech for creators, acquiring AI firm Musiio last month. Musiio, which makes tech that can “listen” to new music and purportedly identify the hits, will be integrated into SoundCloud’s tech stack to improve its discovery experience.
I’ll be back tomorrow with, let’s be real, more Spotify news.