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Follow-up to the IAB Revenue Study

Plus: S-Town heads to the big screen, Australian podcasting is projected to grow, and a quiet podcast startup raises money

Follow-up to the IAB Revenue Study. I wanna zero in on the bit about the apparent drop in dynamic ad insertion usage in the report, but a reader wrote in to push that I emphasize the following components of the study’s process:

  • The methodology to derive the self-reported revenue data isn’t limited to the 15 IAB-member companies. It involves surveys sent out to “top companies” — 19 responses were returned.
  • The broader market sizing analysis was independently developed by PwC  “performing a podcast advertising market sizing to deliver a reasonable estimate of the market in the United States, inclusive of non-survey participating companies,” per page 4 of the report.
  • That reader insistent that I missed the key element of independent market sizing, which is “a first, and a big deal” — I don’t think I underplayed that? If so, apologies!

Anyway, with that out of the way, some notes on the finding that dynamic insertion dropped as an insertion method from 56.4% to 41.7% between 2016 and 2017. A few theories have floated around on this — see former Gimlet head of product Nathan Bashaw, Midroll Director of Audience Growth Bill Irwin, and friend of the newsletter Noah Chestnut — and broadly speaking, they include:

  • Changes in the composition of the survey respondents (I’m partial to this);
  • The increase in branded podcasts shifting the skew (though, I think it’s an open question whether the impact of this ad category is coded into the question of dynamic ad insertion usage; it may well have been viewed by respondents as separate from the mid-roll/pre-roll focus of the question — do correct me if I’m wrong);
  • Dynamic ad insertion being a hassle for many.

Over the past week, I poked around to see what some podcast execs felt about the finding, and a couple of responses ended up overlapping on these two theories:

  • The increase of baked-in ads could be an expression of higher ad-buy volumes on the “head” of an episode’s lifespan — that is, the initial month-plus-long period of time following an episode’s release, which is perceived to be more valuable in the marketplace and is often deployed through as a traditional baked-in host-read ad. Dynamic ad insertion, or “Automatically Inserted Ad” (defined in the report as “prerecorded ads scheduled using ad insertion technology”), is largely thought to be deployed when a network or publisher wants to re-monetize an ad slot after that initial run, i.e. during the ” long tail” of its lifespan. What follows from this, some argued, is the possibility that we’re seeing is not a drop in preference for dynamic ad insertion per se, but a net gain following the growth of new demand for the core “head” ad product. (Or to state it less like the pretentious asshole that I am: advertisers are wanting to buy into fresh-from-the-oven episodes more than episodes that’ve been aging well in the cellar… at this point in time, anyway.) Related reading: “Podcasts Attract Bigger Advertisers In More Upfront-Like Buys,” from MediaPost.
  • A few sources pressed to pay closer attention to the dynamics set by advertising agencies — shops like Performance Bridge, Veritone, Ad Results, and Oxford Road. They play a significant part in determining the scope/proportion of buy types, and their preferences likely go a long way in the setting the scene on this question.

Anyway, let me know what you think. I’ll cop to saying that, personally, I don’t feel particularly good about any theory, and I’m still open to more possibilities on this story.

On the Adaptation Beat.

  • S-Town might be heading to the big screen, per Deadline. Participant Media, the production company that helped shepherd Spotlight, is pushing the deal, and they’re currently in talks with director Tom McCarthy for the project. This American Life is repped by UTA, and news of this comes shortly after the team saw an adaptation of its “Heretics” episode hit Netflix.
  • Meanwhile, the New York Times’s Modern Love property is heading to Amazon Video, having been given a straight-to-series order for an eight-episode half-hour romantic comedy anthology, per the Hollywood Reporter. (In case you haven’t noticed, the anthology format is getting a ton of play in TV right now.) This is yet another situation where the success of a Times podcast lowered the risk-profile of using that property for a television adaptation.

On a related note: the broadcast repackaging of NYT’s The Daily has been picked up by eight more stations, bringing the total to 25. APM serves as the distributor.

Apropos of nothing: So… is Uncle Drew, like, the branded podcast of movies? After all, the Kyrie Irving-led comedy is derived from a popular set of Pepsi Max ads that came out in 2012. You know what, I’m watching it on Monday.

On the Antipodal Beat. From Rainnews:

The PwC Australian Entertainment and Media Outlook projected that the nation could see an 85.9% revenue increase over the next five years. The report also expected that the monthly listening audience for podcasts would more than double to reach 8.9 million by 2022. Eyyyyoooooooo.

Shout-out to all the Malaysians in Melbourne.

On the startup front. A podcast database startup, called PodChaser, announced on Wednesday it has successfully raised a seed round led by the investor Matt Luckett that includes participation from Cornick Capital Ventures, Ed Glasscock, Dave Heath, Kentucky Enterprise Fund, Gill Holland, Rounsavall Investments, and others.

The actual funding amount was not disclosed.

PodChaser was founded in the summer of 2017 by Bradley Davis. The podcast database ventures has struck partnerships with RadioPublic, Podible, Player FM, and Procast.

Resettling. In case you missed it, from the San Francisco Chronicle:

Al Jazeera International, a major global news organization, is shutting down its San Francisco office, home to its social media arm, AJ+, and moving it to Washington. The move will affect all 68 employees who work at the site.

The San Francisco branch was also home to Jetty, the organization’s fledgling on-demand audio network. They were responsible for the narrative soccer-futbol podcast, “Game of Our Lives,” which stands as one of my few sources of World Cup pods, of which I can’t get enough.

Anyway, I checked in with the Jetty team. GM Kaizar Campwala tells me:

Jetty is moving from San Francisco to Washington DC. Since launching in November of 2017, Jetty has had strong success with our debut show, Closer Than They Appear, and Game of Our Lives which just launched its second season on Friday. The Jetty team will be expanding in DC, and internationally. Look out for job postings later this summer.

But will there be scooters tho.

Follow-up to Audioboom. The company’s recuperative fundraise should put a cap on this story for now, which spanned several months and one major reversal of fortune. But as promised in Tuesday’s newsletter, here’s my full Q&A with Chief Operating Officer Stuart Last, in case you’d like more background on his perspective.

Note that my questions here are streamlined versions of what I originally sent the company. Here it is:


HP: Help me understand the context. How should we view this new funding round? Is the money meant to stabilize the business, or is it to sustain the business as you develop it into a more sellable asset?

Last: The funds are coming from a mixture of current and new investors. It’s not a stopgap measure – this is investment that will accelerate the growth of Audioboom. While there were aspects of the Triton merger that made being part of a bigger corporate entity exciting and in some ways easier, we’ve always felt we could do this independently. We have a great business model and we’ve been growing at an incredible rate since we launched in the US, we wanted the opportunity to see it through independently and I’m really pleased that we get to do that. As I said the goal of the fund is growth, to drive us to profitability and beyond — so the money will be invested in key areas and territories. In the US we’ll grow our original content network — invest in production and host talent, open studios in LA, and create strong marketing budgets that make hits. Globally we will become even more aggressive in signing established independent shows with built-in audience for ad sales representation.

HP: Tell me more about your immediate next steps, and what partners and advertisers should expect from Audioboom in the coming months.

Last: Well as I think you know the delayed Triton deal, had a huge affect on our cashflow and we got behind on some of our partner payments. Since we withdrew from that deal we’ve taken some big steps to catch-up those payments and have more than 70 shows up to day and many more on payment plans. So as the money comes in from this funding round it will be a high priority to get our partners fully paid — then we can regain their trust and become a proper partner again, helping them grow, reach new audience, taking their revenues to even higher places. Advertisers should expect an even stronger roster of shows to come through Audioboom as we make more signings and grow our Originals network.

HP: In earlier quotes given to the trade press, you guys signaled that you would be “cutting small unsustainable” shows in a bid to control costs. You mentioned there was a misunderstanding about that — what do you mean?

Last: Yeah, so the reference to cutting smaller shows was actually about the natural end of some of our legacy radio relationships. We hosted and distributed thousands of podcast channels for our radio partners globally — those channels took a lot of staffing and tech resource, but provided a very small part of our income. But, we are fully committed to working with podcasters at all levels. While we have our premium sales network of 150 shows and our Audioboom originals we have great tools and services beyond that. We have $9.99 subscription package that lets podcasts that do not want to run ads have access to professional level hosting, distribution and analytics tools – it’s the best value package on the market today. For shows that may be too small to attract live read sponsors we have a programmatic ad network – they can switch it on, run ads and monetize that way. We’re working on a very cool merchandise solution right now that we hope to launch in Q4 – it will allow shows of all sizes to offer merch to the fans through bespoke storefronts, without of the risk that comes with paying for all their hoodies and tees to be printed in advance.

HP: Why weren’t you able to execute the reverse takeover? What happened?

Last: You know, it’s probably been the toughest 4 months of my working life — my therapist would probably advise me not to go back into it! We’re happy to continue independently and I think this fundraise is testament to the belief in Audioboom’s position in the market and it’s growth plans and business model. We’re in a good place now with Triton and are already talking with them about ways the two companies can work together in the future.

HP: What is Audioboom’s place in the UK podcast ecosystem, and in the podcast ecosystem more broadly?

Last: Most of Audioboom’s business comes out of the US, but in the UK we’re in a great position. We’re one of only 2 commercial companies that are really active there — so between us and Acast we dominate sales and technology, but of course it’s 3-5 years behind the US so the whole model is still developing. With the BBC fully embracing podcasting now, I expect the market — in terms of listeners — to grow very very quickly in the next couple of years, then the money will really flow once there is scale. In the UK we have the chance to dominate the space fully, whereas in the US we are one of 10-15 major players in a fragmented market.

HP: I’m curious about the fact that most of your business comes out of the US. In Audioboom’s view, what is the state of the UK market?

Last: Yes, around 90% of our business is out of the US. I’m bullish on the UK for a few reasons — higher advertising rates, a country that loves radio and audio, and a very active independent production sector that to this point mainly makes programming for the BBC, but now can take their creativity and production expertise to Podcasting.

I’m also positive that it is not going to linger on the Direct Response advertising model that has been so prevalent here. It’s already moving very quickly to brand advertising, and there’s a much higher regard for, and use of, ad-tech for the delivery of advertising. It’s still host-voiced and endorsed or produced in the style of the podcast, but its delivered more efficiently, and isn’t as reliant on sales conversions so there’s wider potential for brands to support publishers long-term.

But it’s not without it’s challenges — the UK is 1/5 the size of the market in the US and if the BBC owns 50% of the podcast space like it does the radio space, the market size for advertisers and independent producers quickly becomes 1/10 of the size of the US market as the BBC does not run any advertising domestically.


Alrighty, time to put a lid on it.