Spotify’s 17 % workforce discount was one of many largest headlines in music, audio, and tech final week. These layoffs coincided with the cancelation of a number of the most critically-acclaimed podcasts to come back out of Spotify’s acquisition drive: Heavyweight and Stolen. In gentle of that information, former Spotify podcast govt Lydia Polgreen had some selection phrases for her former employer, suggesting Spotify is “merely unhealthy at podcasting” and “lit cash on fireplace by handing it to the Sussexes and different celebrities with nothing to say“. Ouch.

Polgreen’s take shouldn’t be distinctive in right this moment’s podcast market. In accordance with Vulture’s Nicholas Quah, podcast insiders, creators, and executives are questioning why TV and movie executives are being employed to run podcast outlets, indicating that it represents an absence of imaginative and prescient. But, podcast firms proceed to look towards TV and movie for content material, advertising and marketing, and monetisation inspiration. 

Hollywood superstar is extra about advertising and marketing than expertise

When Hollywood studios flood their slate of film releases with A-list names, their calculations have a lot to do with which actors and actresses will garner essentially the most consideration. When Netflix was attempting to realize legitimacy, it needed to play the identical recreation. Enter Kevin Spacey in Home of Playing cards. Out of the blue, Netflix was not only a platform; it was a full-fledged Hollywood studio competitor. Spacey was a press release of intent, placing the world on discover that Netflix was a critical participant with huge ambitions.

Spotify went after one thing related. In 2020, the corporate paid Joe Rogan, Meghan Markle and Prince Harry, and the Obamas thousands and thousands of {dollars} to solely host their podcasts. The play was to make use of these A-list names as legitimacy markers that may concurrently assist Spotify set up a foothold within the podcasting market and put the competitors on discover. The technique bore fruit: Spotify reported its first earnings within the years following their foray into podcasts, and it’s now the second most-widely-used platform for accessing podcasts, in response to MIDiA’s Q2 2023 client survey. (Spotify was high however has lately been overtaken by YouTube).

In the meantime, over at Amazon, Wondery is utilizing big billboards and pop-up experiences to advertise their ‘Tis The Vacation Grinch Podcast, thanks largely to Nicole Blake, who beforehand led international franchise improvement for the Harry Potter model at Warner Bros. On the Economist, Govt Vice President of Advertising and marketing Nada Arnot says that they’re “taking a web page out of the Hollywood guide” to advertise their podcasts, utilizing related methods to how she promoted video subscription platform BritBox. Netflix’s former World Advertising and marketing Director, Crystal Ponzio-Busto, now heads up advertising and marketing and communications at Crooked Media, residence of chart-topping podcast Pod Save America. It doesn’t matter whether or not podcasts function in tech, journalism, or politics — the flip towards Hollywood is evident. What’s much less clear is whether or not this strategic pivot will assist the podcasting business in the long term.

Are blockbusters going the way in which of, nicely, Blockbuster?

If one development defines the previous couple of years of media consumption, it’s fragmentation. This isn’t to say a mainstream doesn’t exist, however throughout leisure, niches proceed to extend their affect. A few of Hollywood has not gotten the memo. 

In accordance with Bloomberg, most of Disney’s flagship film titles struggled on the field workplace within the final two years. And it was not simply Disney — Sony Photos’ revenue decreased some 45 % from 2021 to 2022  and that’s after the dip that each one studios noticed popping out of the pandemic. In the meantime, towards this bleak surroundings for aspirational blockbusters, impartial movie distributor A24’s gross field workplace income elevated 4x throughout the identical time interval, partially by specializing in titles which are decidedly non-mainstream. The 2 main Hollywood studios that did see important income development throughout this era launched Barbie (Warner Bros.) and Oppenheimer (Common) — a meme-driven double unicorn that these two studios rode into the sundown.

Mainstream blockbusters should not smashing data like they used to, irrespective of what number of billboards, activations, or celebrities the foremost studios put money into. These strategic mixtures may need been foolproof in yesterday’s mainstream media panorama, however except Hollywood studios are activating area of interest segments of the web, they are going to proceed to battle within the face of fragmentation. Simply as in music, we’re within the period of fragmented fandom the place area of interest is the brand new mainstream.

Podcasts ought to develop their very own identification

There are huge classes for podcasting right here. For one, podcasts are scaling in tandem with a fragmenting media panorama, which creates plenty of unknowns. It’s definitely attainable {that a} mainstream will re-form, however it’s more likely that fragmentation will change into the norm, making conventional movie and TV advertising and marketing much less efficient over time. If everybody consumes content material inside their very own media niches, it’s tough to achieve throughout populations, and rather more efficient to concentrate on hyper-targeted viewers improvement.

Second, the strain is on for podcast monetisation, and spinning out IP into movie and TV is an attractive choice for substantial income technology. Nonetheless, not certainly one of the most well-liked TV exhibits on IMDb was tailored from a podcast. So, even when the monetary return is important for the handful of podcasts that have made the crossover, that’s not the case for the 4 million-plus different podcasts that comprise the lion’s share of the podcast business. And naturally, the extra podcast titles which are launched, the larger the fragmentation. It’s, relying on the place you stand, both a vicious or virtuous circle.

Nonetheless, podcasts should not have to emulate movie and TV to be taught from it — or another business, for that matter. Podcasting is a singular medium with a brief however wealthy historical past of audio storytelling, journalism, comedy, and dialog, and maybe not sufficient experimentation but. It’s price leaning into what has made podcasts one of many fastest-growing media segments of the final decade — unique storytelling, client autonomy, and portability — as a substitute of trying prematurely to different industries’ methods that will already be displaying indicators of diminishing returns. Whereas layoffs are by no means excellent news, Spotify’s say extra about their strategic choices and priorities somewhat than the podcast business itself.