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Hot Pod Insider

Insider October 21, 2021 — Spotify goes all in on video podcasts

Just as YouTube starts caring

Hey Insiders, welcome to Thursday. (How do we feel about Insiders? Hot Podders? Podsters? JK, I know Podsters is an immediate no, but we’re having fun!!) Here at The Verge, we’re gearing up for our big 10-year anniversary party this weekend, which is going to be very cool, if I do say so myself. Picture lots of neon lights, bars, and tech talk. I’ll be on stage interviewing Clubhouse’s CEO and its head of global marketing if you feel like coming by. You can still get tickets here, and you’ll want to enter the code $99NOW. You can probably guess what happens when you use it! Anyway, if you’re planning to come by, please do reach out. I’d love to meet IRL. 

Alright, enough of that and on to the goods. 

Spotify, Spotify, Spotify

I imagine that subhed is how you all feel hearing about Spotify week after week, day after day, but man, they make a lot of news! So, today, it’s a Spotify story in three parts. The first: Spotify will let all Anchor podcasters apply to upload video podcasts. Anchor creators can apply for the privilege to upload a video podcast to the platform, and a spokesperson tells me the decision on who’s allowed to do so will come down not to listener numbers but “loosely” engagement, as well as “approving content that’s likely to be both visually compelling and audio-friendly.” 

Podcasters can monetize these videos through Anchor’s subscription feature, which it announced in April, or through automatically inserted ads from the Spotify Ad Network, which it opened up to Anchor creators earlier this month. For now, Spotify isn’t inserting or selling video ads — any ads that show up in video podcasts will be audio-only with a still image of the podcast’s cover art on screen while it plays. Spotify has “no news to share” about future plans, like eventually also selling video podcast ads. 

There’s more to think about, like how Spotify video podcasts could go wrong from a moderation perspective or the open question of whether people want to watch videos on Spotify, but the bigger thing to point out is how poised Spotify is to take on YouTube. Anchor was always Spotify’s big play for user-generated podcast content, setting it up to be the YouTube of podcasting. However, when it launched video podcasts to support Joe Rogan’s operation (himself a major poach from YouTube), it seemed like Anchor’s ambitions might directly compete against YouTube more than I initially thought. 

Now, here we are: more people can upload video podcast content and possibly monetize it all while YouTube is reportedly taking podcasting more seriously. Bloomberg reported earlier this month that YouTube is hiring a dedicated podcast executive — a signal toward its growing podcast interest. Can YouTube rev up its podcast operation and show podcasters it cares before Spotify amps up its monetization efforts and lures all the YouTubers over to its platform? Drama!

Next up, and speaking of Spotify’s ramping up its ad ambitions: The company’s planning to hire “hundreds” of people for ads sales around the world, according to Reuters. Lee Brown, the global head of Spotify’s ad business, tells the publication the company is increasing its ad workforce by 70 percent in Europe, Australia, and Canada. 

“We’re investing in our advertising business,” he says. “As far as long-term strategy, I think gone are the days of advertising being less than 10 percent of our overall revenue.”

Of course, I have to requisitely remind you that Spotify is especially interested in podcast ads because it can double-dip on them. Premium users hear them, just as free users do. 

And in the interest of diversifying revenue, let’s take a brief look at how Greenroom, Spotify’s Clubhouse competitor, is going. I got my first promotional email from the team there to my personal email, and dang, it’s just kind of sad? The subject line is: “ICYMI: Catch up on all the epic Spotify Greenroom episodes you missed now.”  

Here’s what it looks like, and to be honest, I follow this industry pretty closely and haven’t heard anything about these shows. Is anyone tuning in? 

Tapping through takes you to the shows’ homepage but doesn’t actually lead you to listen in to the programming. When writing this newsletter, I tuned into a featured show — like a show pinned to the top of the app seemingly by Spotify itself — and only three other people were simultaneously in the room with me. Not great!

Alright, we can exit Spotify talk for now and conveniently drop a bit of YouTube news…

YouTube Music makes free user access audio-only; video will cost ya

Just as we’re thinking about YouTube and Spotify, YouTube has clarified a few things about its announcement earlier this month that Canada-based users will soon have access to background play for free. The company now says free users actually won’t have any access to videos — a major change. Again, this is Canada-only for now, but really, this turns YouTube Music into, effectively, a free audio streaming app with video as an extra perk. (And presumably, this will expand to podcasting, too.) We’ll see. 

On to radio world…

Audacy drops millions on streaming ad tech

Audacy yesterday announced its acquisition of an “exclusive, perpetual license to WideOrbit’s digital audio streaming technology.” (The deal, per an SEC doc first spotted by Podnews, cost Audacy $40 million.) This streaming tech will be rebranded to AmperWave. WideOrbit offers various tech stacks for TV and radio broadcasters to help them monetize their content, and Audacy is particularly interested in how the company’s streaming solution can help it distribute and monetize streaming radio broadcasts.

This is slightly complicated, but to sum it up as plainly as I can: Audacy operates hundreds of radio stations. Those radio stations produce lots of live content. That live content can be monetized, but as we know, monetizing it on-demand is also critical. WideOrbit provides the tech to make the streaming possible — something Audacy is interested in — but also helps handle the ad insertion during those streams. I spoke with J.D. Crowley, chief digital officer at Audacy, about the deal to get a better understanding.

Crowley says right now, Audacy works with various companies to stream all its radio station content, but this deal could enable the team to chop up, mix-and-match, and play the content in various ways. So if a listener wants content around a specific topic, this WideOrbit tech allows them to pull in podcast episodes, radio snippets, and whatever else. This is critical because Audacy runs its own listening app, too, and I imagine this might help it serve content there.

“I think the important thing for us was we want good tech, and we want a good team that knows this space and has a lot of experience doing this, and we want to own it,” Crowley says. “This part-streaming, ad delivery, eventually podcasting, hosting, and then the ad serving behind that, that’s critical for us to own in today’s world.”

He also adds that the team will continue to serve existing customers using this tech, despite the new Audacy ownership.

Also, yesterday, we had one more bit of radio-adjacent advertising news.

Cumulus Media brings its programming to Strata

This is suuuuuper industry, I know, but I want to mention this news here because it speaks to how much the radio broadcasters, who also operate podcast networks, are trying to monetize their programming. The ad deals! They just keep coming.

Cumulus Media is going to put its podcast ad inventory on Strata, an entity of FreeWheel, which itself is owned by Comcast. FreeWheel sells ad tech, and its Strata business gives agencies and marketers a place to “plan, activate, optimize, and manage billing and financials” for all their media buys in one place. Although Cumulus does its own work to sell ads against its podcasts, which include Ben Shapiro’s and Dan Bongino’s, this deal will put those shows in front of at least 1,100 agencies who can then try to sell ads into them. This is just one example of how audio makers are trying to put their content anywhere and everywhere to reach all the potentially interested advertisers out there exploring audio.

Okay, I’m out of here. For those at The Verge event this weekend, I’ll see you soon. For the rest of you, I’ll see you virtually back here on Tuesday. Aria will be in your inboxes tomorrow. Ta-ta!