Betting on Audio
Podcasts are getting louder…
Since the pandemic, I started to give podcasts a shot — a real shot. Before I would switch back to music within 10 minutes, but now it’s pretty integrated into my daily routine. Part of the reason for this change is that it took me a while to find podcasts that I actually liked and didn’t feel like mundane lectures (or actual lectures) and bleh conversations. From Michael Barbaro’s soothing voice on The Daily to Wondery’s re-enactments in Business Wars to ABC’s investigative journalism in The Drop Out, these high production value and well-researched podcasts have hooked me. Now, I’m in it for the long run and companies are starting to capitalize on people that share my behavior.
Though podcasts have been around for years, the podcast streaming industry is expected to grow to over 2 billion listeners by 2025 (up from 800 million in 2019). That’s Facebook level reach, and with an ad market on track to be $3.5 billion, podcasts could shape up to be a substantial business for streaming services and artists who join in. Podcasting will continue to be tiny relative to the music and movie industries, but its projected growth is finally enough to incentivize businesses to make strategic changes for the future.
The tech industry is quick to hop on this trend. Apple will likely charge subscribers soon to listen to their podcasts, a move that will boost their revenue if they can successfully convert listeners to paid subscribers. Amazon will acquire Wondery for $300 million and have their huge catalogue of well-produced shows. Spotify has made a large push into the sector by signing on public figures and royalty to host shows (though this may not be working out as expected). Even new startups have spun out to make podcast production easier for average creators, such Anchor (nabbed by Spotify) and Descript, with its new round of funding. And Clubhouse is attempting to make a social media completely around the concept of “drop-in” conversations which, to me, feel a lot like podcasts.
All of this buzz is exciting and I’m a firm believer that audio-streaming will prove to be a promising form of entertainment in the short-term. I do often question how creators can make podcasts more interesting down the line. With film, directors can obviously boost their VFX, shot composition, pacing, etc., but there may be a limit to how creative you can get when it comes to podcasts. The best I hear is sleek editing that bounces back and forth from interviews to historical audio to vintage ad commercials, and occasionally splices dialogue to overlap for dramatic effect. But, it’ll be an interesting challenge to figure out how people can make conversations sound cooler in the years to come.
Also, another obstacle to overcome, though this is quite far away, is once self-driving cars popularize, podcasting may decrease considering over half of listeners hear them while driving. If you don’t have to pay attention to the road, why not just pull your phone out? That’s something unique about them. Podcasts work very well when you need to keep your eyes focused on what’s in front of you, but not pay that much attention, and fair poorly when you have a screen at your disposal (still, I’m sure many listen when they walk, clean, etc.). Many use it as a backup form of entertainment, but it’ll slowly climb its way into the driver’s seat of streaming (or a front seat at least).
Either way, podcasts are going to be more mainstream and businesses are betting on their success. I’m here for it. In a few years, I wouldn’t be surprised if I’m talking with friends about Dax Shepard’s Armchair Expert as I am about Netflix’s Bridgerton this week…
