Nieman Foundation at Harvard
HOME
          
LATEST STORY
Journalism scholars want to make journalism better. They’re not quite sure how.
ABOUT                    SUBSCRIBE
March 24, 2020, 11:02 a.m.

Is The New York Times’ purchase of Audm a turning point in its new audio strategy?

Plus a deep dive into how coronavirus is affecting the podcast industry. “Some podcasts can survive cuts in direct support. Some can survive losses in advertising revenue. A great many can’t.”

Welcome to Hot Pod, a newsletter about podcasts. This is issue 251, dated March 24, 2020.

The New York Times Company has acquired Audm, a subscription-based service that creates performed narrations of longform features. (Here’s the announcement post.) If you’re unfamiliar with Audm, you might have seen its embed player running at the top of selected features on the websites of outlets like The New Yorker and The Atlantic. The service isn’t built on an automated text-to-speech solution, instead relying on a production pipeline involving actual voice actors. It’s a rather manual system — hence the selectivity of the pieces that get the Audm treatment.

This development comes not too long after rumbles of another potential audio-related Times acquisition: Serial Productions, the possibility of which was first reported by The Wall Street Journal in mid-January and further talked up by the Times’ own media columnist Ben Smith. The latter report shed some light on the thinking behind it: a belief that a Serial Productions deal, together with The Daily, would serve as the bones for a new standalone product that could be the “HBO of Podcasts.”

It doesn’t take a significant leap to view Audm, which was built on a paid subscription business model, as something that would directly contribute to the value of this theoretical Times-owned audio product. However, I’m less sure about any iteration of this product that would involve dragging The Daily behind a paywall…or even behind a walled garden. (That is, “download this Times audio app if you want to listen to The Daily, even for free.”) For anything meant to be the top of funnel, ubiquity and a wide surface area are super useful qualities.

Anyway, the terms of the deal were not disclosed, natch. And for what it’s worth, a Times spokesperson told me that Audm will continue to produce narrated reads from other publishers. I reckon that might change, unless those other publishers become comfortable with relating to the Times as a platform ~frenemy~.

Spotify launches a new podcast API, meant to allow developers to build apps and other digital experiences to help listeners discover new podcasts on the platform. The streaming platform rolled out the API on Friday, and according to the corporate blog post on the matter, it will function much like Spotify’s music-related APIs. An expected gambit, given the company’s data-centricity and ambitions to become synonymous with the solution for long-standing problems associated with the podcast ecosystem.

Edison Research’s Infinite Dial 2020 is out, and you can find it here. There are a couple of noteworthy podcast-related top-lines — monthly podcast listening is now 37 percent of the total US population over age 12, Spotify now matches Pandora in terms of audio brands listened to within the past month — but I mean, given the events of the past week or so, my brain can’t stop viewing it as a snapshot of a world gone by.

Speaking of which…

Uncharted waters. Like the rest of the United States (well, almost), the American podcast business experienced a sudden disruption over the past week as a growing share of the population was made to sharply limit its time outdoors as part of the effort to slow the coronavirus pandemic. New York and Los Angeles, hotbeds of both podcast creation and consumption, are now under strong lockdown measures to combat worsening conditions, which has pushed podcast publishers to rapidly reorganize in order to navigate their new reality. Offices were vacated, productions were adapted to remote workflows, and Ira Glass was left recording barefoot out of a closet.

But as disruptive as the past week was, it will almost certainly pale in comparison to what lies ahead. The stark reality is that the worst of this crisis has yet to come, particularly in this country, and it is simply unclear what this American life — let alone this American economy — will look like in a few months. Come fall, we might find ourselves locked under even more aggressive social distancing measures, paying the cost of the Trump administration’s crisis management today. We may find ourselves in the punishing throes of a global economic catastrophe unparallelled in modern times. Indeed, we could find ourselves buried under multiple worst-case scenarios, all at the same time.

The present moment is thick with uncertainty as we skirt the edge of a cliff. Things are bad right now, but it will definitely get worse before we can even dream of things getting better, both epidemiologically and economically. Just how much worse, and what kind of worse, are the operative questions.

And so, much like the rest of the country (again, almost), the podcast community is bracing for impact. “There’s no real way to think about this based on previous models, like past recessions,” said Bryan Moffett, chief operating officer of National Public Media. “We’re in uncharted waters.”

As Americans find themselves increasingly homebound, some in the podcast community worry there will be steep declines in listening, given that one of the fundamental environments for podcast consumption behavior — the daily commute — evaporated overnight for millions.

There’s a straightforward answer to this query: It’s too early to tell. Still, there have been discernible changes over the past week. Chartable, a podcast analytics company, found that overall listening across the shows they measure took a dip, but to a smaller degree than they had anticipated and in a manner that’s distributed unevenly across different show types. Podtrac, the analytics company that publishes those industry rankers, found that weekly podcast audiences in the U.S. decreased 8 percent in the week of March 16, a greater drop than the 2 percent decrease in the previous week, at least for its measurement set.

Podtrac will publish the graph of this data point, along with several other points of information, on its website later today, and plans to update the report weekly throughout the crisis. Longtime readers know I have my concerns when it comes to Podtrac when it comes to ranking the most popular podcasts — but this is a situation where their data is unambiguously useful, given that this report will be tracking changes over time on the same pool.

Stitcher, which operates one of the bigger podcast portfolios in the business, saw similar things. Erik Diehn, the company’s CEO, told me that they saw dropoffs on Monday and Tuesday — again, unevenly distributed between shows — but that listening numbers had broadly stabilized by the end of the week, even picking back up a bit. “Given that people have basically stopped commuting, I’m pretty happy to see where things are,” he said.

Not everybody appears to be experiencing the same things, however. Some companies claim they’re seeing audience bumps, fueling some confidence at least in the short term. “We’re seeing increased listening for the majority of our shows,” said David Raphael, president of PMM, which serves as the ad sales partner for podcasts like The Joe Rogan Experience and Anna Faris Is Unqualified. “We expect that to continue.”

It’s tempting to assume that this moment would foster listening bumps for news podcasts across the board, along with the crop of new shows that have popped up around the coronavirus story. Right now, there doesn’t seem to be much that suggests otherwise. A Vox Media spokesperson told The New York Times that its podcasts have been downloaded “50 percent more than usual,” with newsier shows like Today, Explained seeing bigger increases. Meanwhile, Slate tells me that its audio division saw downloads increase by 47 percent in the past month, largely driven by their coronavirus coverage.

All of which is to say it’s a mix — and again, it’s still too early to get a firm sense of how things will ultimately shake out. These are observable changes that played out as the majority of Americans begin to settle into their new reality. Among the many podcast producers and executives I checked in with, there’s an emerging belief that the important structural impacts will only reveal themselves as we begin to get a full sense of how bad the pandemic will get in this country — as we see weeks under lockdown conditions potentially turn into months and as we wade more deeply into the layers of negative economic impacts that will result from the sum of all these cataclysms.

Questions and speculation abound. Some suspect that we’ll only see the true declines in listening in a few weeks, when the Apple Podcasts app stops automatically downloading episodes due to inactivity. Others wonder about how audience tastes will change as life drifts into a prolonged state of heightened crisis. Will listeners burn out on news and coronavirus coverage? Will there be strong appetites for escapist fare? Will demand bifurcate between shows that lean hard into coronavirus coverage and shows that lean far in the other direction — with little interest for what lies in-between?

(On a related note, here’s a curious factoid I heard in my conversations over the past few days: The true-crime genre seems to have taken a hit over the last few weeks.)

And of course, what will happen on the business side of things?

The podcast business is still predominantly powered by advertising, a channel that’s especially tethered to the ebb and flow of the greater economy. Speaking with over a dozen podcast makers last week, I heard about several instances of ad cancellations and preemptive non-renewals. These pullbacks seemed to be mostly clustered in the industries most directly affected by the pandemic, like travel and live events — but not always.

Cancellations also popped up among direct response advertisers that are experiencing supply-chain disruptions. One indie producer told me one company had to pull out of a buy because they’d literally ran out of inventory and are uncertain when they’ll be able to restock. It’s very possible that we’ll see more of this kind of cancellation as the crisis worsens. “We’re teetering on the edge of what could be disaster to advertising revenue,” said Allyson Marino, who runs the podcast company Lipstick and Vinyl. “While podcasts can continue to be produced, products advertised may not be viable in a prolonged quarantine state or worse.”

Again, the podcast ad story isn’t completely straightforward. The audio divisions of larger diversified media operations will be generally less precarious, as the total risk gets spread across multiple lines of businesses. (Unless, of course, said audio division isn’t taken all that seriously by management, in which case they’ll probably be benched.) And not everyone I spoke with had seen cancellations yet: Slate made it a point to note that they haven’t seen any advertisers pull dollars up to this point, and that they are still making sales.

Meanwhile, other podcast-first companies are still sending sales teams out into the field, with the mandate of forging ahead and bringing as many new advertisers, wherever they’re active and operational — food and entertainment brands were cited, as were several types of internet companies — into their mixes as possible. Some claim to be seeing returns from these efforts, even under these abnormal circumstances. (Sales meetings over Zoom!) But they still have the overarching concern of whether they can get past just treading water — i.e., adding enough new buys only to make up for the ones lost — and whether they can sustain the upcoming shockwaves as more advertisers begin to reconsider their confidence in future quarters.

The way several podcast executives put it to me, the focus right now is to keep making episodes, control costs as much as possible, and prepare to ride out the coming storm until a “new normal” is identified. In the context of podcast advertising, that means a state of relative steadiness where advertisers are able to project their business forward with enough confidence that they are comfortable making ad buys at volume again.

In my experience, ad sales people as a species tend to be natural optimists, and their perspectives here reflect that tendency. Many phrased this moment as a period of temporary destabilization, with any lull in ad spends a consequence of advertisers reacting, assessing, and calibrating to the situation. The next quarter will be rocky — but at some point later in the year, they argue, companies will have to start advertising again, because they’ll have to market to customers in order to survive — even if those customers are sheltering in place. Indeed, a few even went further by noting disruptive moments like these can also represent a kind of opportunity: Past recessions often saw brands spending to win new market share over competitors and incumbents.

Which is true, I suppose, but then again, they’re calling all this “unprecedented” for a reason. Regardless of how those advertising dynamics play out, one thing is for certain: Podcast advertising, previously projected to beat $850 million by the end of this year, will almost certainly miss that mark.

Things are also too early to tell on the direct-support side of the equation. Patreon, perhaps the biggest facilitator of direct-support dollars in podcasting, says it’s seen increases in both the number of creators launching on its platform and in patronage, in terms of both patrons and dollars. (They’re not sharing any specific numbers on the record at this time, nor were they able to provide breakdowns between verticals.)

But this early surge strikes me as soft, and I’m less confident about its viability in the longer term. I’ve heard from a handful of independent podcasters whose business models rely heavily on direct listener support, saying they’ve seen some declines in paying supporters, with one of the main reasons for cancellations being that they’ve lost their jobs. Unemployment is skyrocketing to inconceivable heights, and as it gets worse, more and more people are going to be aggressively cutting back on non-essential costs. A lot of independent podcasters will probably be hard hit.

Some podcasts can survive cuts in direct support. Some can survive losses in advertising revenue. A great many can’t. Does it need to be said that not everyone in the podcast community will survive this? And that the podcast landscape will probably look very different whenever we return to a steady state, however long that will take?

The podcast economy is like any other economy: If someone’s not spending, someone else isn’t getting paid. Though many publishers are still committed to upcoming show launches, others have already suspended development, postponed rollouts, or canceled projects outright. That means some producers, talents, and production studios won’t be seeing that revenue, which could push them into financial hardship and lead to the end of their businesses.

Some are more exposed than others, depending on the nature of their contracts, commitments, and investments. Companies that are stacked with more flexible revenue-share agreements are probably better off than those with fewer (at the expense of the talent). Conversely, talent on contracts with guaranteed money is probably better off than those with more variable payouts (at the expense of the podcast company, pending clauses that give them an out).

It should also go without saying: What comes next will be really hard for companies carrying a ton of debt that haven’t really figured out their position in this space. Many of these operations will almost certainly be cooked.

Meanwhile, I imagine some processes and trends will probably be accelerated. Anchored by a base of paying subscribers that’ll still be big even if it takes a hit, Spotify will likely find new lanes of opportunity in all this disruption — particularly when it comes to dealmaking with talent. Speaking of which, I’ve started hearing that more entertainment industry talent — locked out of film, television, and live events circuits — have started to eye podcast development work. Indeed, this could be a moment that accelerates the corporatization and consolidation of the podcast business, as bigger companies with deeper reserves weather the storm that washes away the smaller. (A concern that applies to nearly every sector of the economy today.)

Look, you’re free to believe what you want. Me, I’m bracing for the absolute worst. But if you’re looking for any hopeful arguments to be made — even as mere consolation — I’ve found two that hold some currency with me.

The first is the idea that podcasting is among a handful of media formats uniquely suited to the highly specific limits imposed on daily American life right now. In a few months, film and television productions may still be on hold, but podcasts — news, fiction, comedy, and so on (maybe not sports) — will continue being made with relative ease. And in that scenario, they would be proving their value to advertisers by the sheer virtue of still being around.

The other is a sense that podcasting still has a kind of hardiness that will help it survive whatever lies ahead — and even thrive whenever we come out the other end to a new normal. I’ll give the final word to Sarah Van Mosel, the chief revenue officer at Stitcher and an alum of Market Enginuity, Acast, and New York Public Radio.

“Podcasting was born from adversity,” she said, referencing the fact that the modern podcast business and many of the bigger shows we know today — WTF with Marc Maron, 99% Invisible, and Comedy Bang Bang, among others — launched in the immediate wake of the Great Recession. “I think podcasts are the scrappy survivors of the media industry. We’re not so big that we’re too fixed in our creation process and vulnerable to changes like this. But we’re not so small that we’re entirely dependent on a small group of advertisers to keep us alive.”

Natural optimists, indeed.

What the virus means for BBC Sounds [by Caroline Crampton]. A really long time ago — by which I mean January — one of the biggest U.K. media stories concerned the future of the BBC. Back then, I laid out all the competing arguments, and looked at how Boris Johnson’s ascent to No. 10 could alter the way public-service broadcasting would be funded in the future. In brief: Johnson wanted the BBC, which his side of politics traditionally perceives as biased and wasteful, cut down to size. The process was already underway: an inquiry had been launched, and new competitors like Rupert Murdoch’s Times Radio were already shifting the narrative around the BBC’s irreplaceability.

The world in which all that happened is unrecognizable today, of course. Johnson, like everybody else, has other priorities right now. (Last night the country was placed in effective lockdown.) It’s always been a peculiarity of British broadcasting that, in times of crisis or great tumult, people still instinctively turn to the BBC. Other channels struggle to compete with it on election night, for instance, and when the Queen dies, it’s assumed the BBC will be where most people will turn to watch or hear events unfold. When I worked in a newsroom, we’d regularly switch the TV over to the BBC for a quick initial check of something that was trending on social media. With coronavirus misinformation spreading all over WhatsApp and social media, accurate coverage from BBC and other trusted news outlets matters more than ever.

I must admit that I fully expected podcasting to fall by the wayside as the BBC scrambled to cover the outbreak while also keeping its thousands of staff safe. I thought the corporation would retreat to its “traditional” forms of broadcast (i.e. radio and TV) and pick BBC Sounds back up as a priority again if and when this is all over. But I was wrong: Podcasting has already emerged as an essential way for the BBC to serve its audience in these times. And while BBC Sounds has generally been considered part of a strategy to keep young people engaged with the BBC, right now its offering is being tweaked to serve a much broader audience.

Podcasting is a key part of the BBC’s coronavirus strategy, in part, because it’s a format relatively safe to assemble while people are in isolation. But I also think the focus on on-demand audio shows how far the BBC has come in a short space of time when it comes to embracing the medium as a core component of its product.

The BBC’s announcement of how it was adapting its service to these new times deliberately echoed John Reith’s mission statement from the corporation’s beginnings in the 1920s: “Inform, educate, and entertain.” Those three principles now govern the virus plan. News coverage is being prioritized, with some current affairs interview programs suspended so that personnel can be redeployed to main bulletins. Archival TV and radio is being reuploaded to apps to help keep people entertained. New products are being launched to help parents now schooling children at home.

Podcasting is present in all aspects. The BBC’s most popular podcast, Newscast (formerly known as Electioncast and even more formerly known as Brexitcast), is now The Coronavirus Newscast. All other daily news podcasts have been suspended so that staff can focus on this one show. Match of the Day, the BBC’s flagship football TV program, is now a podcast recorded in presenter Gary Linekar’s kitchen. Primary and secondary education at home is to be supported by two new forthcoming feeds in BBC Sounds.

Although almost all BBC news and current affairs shows aren’t making new episodes at the moment — the U.S. election show Americast, current affairs podcast Beyond Today, and internet analysis show The Next Episode are all affected — commissioning continues in other areas, both on the subject of coronavirus and on ideas that will help people take a break from it. Though the audio sector in the U.K. will be greatly affected by this crisis, having the BBC still taking pitches, buying new series, and essentially remaining an active economic engine will be really important.

With production suspended in many other parts of the BBC’s output (such as TV drama and soap operas), audio drama is pushing forward as much as possible. Venerable radio serial The Archers is reducing from six episodes a week to five, but continuing for now. Several BBC Radio 4 radio programmes with big on-demand followings like In Our Time and The Reunion won’t be making new episodes and so will air repeats, as will some comedy shows.

Live radio broadcasts are still challenging — but podcasts are cheap, safe to make, and offer an opportunity for the BBC to reach people where they are right now, on their phones, looking for some help or relief. And by making archive content available (like old sports commentaries and decades-old radio dramas), the BBC hopes to broaden the appeal of Sounds to a wider demographic. I wouldn’t be surprised if the BBC has seen record traffic on many of its outlets in recent days, and as more people use Sounds for the first time, it could well become a bigger part of listening for a wider variety of people.

There will be no official “ending” to all of this, a day when everything suddenly goes back to how it was. But when we do eventually ease back into greater contact with others, and other news stories begin to surface again, I think how the BBC is perceived to have handled this crisis will matter greatly. Before, critics of the government’s position on the BBC would warn that “you’ll miss it when it’s gone.” After the coronavirus, we might be better able to visualize how much worse a major crisis would be like without it.

POSTED     March 24, 2020, 11:02 a.m.
Show tags
 
Join the 60,000 who get the freshest future-of-journalism news in our daily email.
Journalism scholars want to make journalism better. They’re not quite sure how.
Does any of this work actually matter?
Congress fights to keep AM radio in cars
The AM Radio for Every Vehicle Act is being deliberated in both houses of Congress.
Going back to the well: CNN.com, the most popular news site in the U.S., is putting up a paywall
It has a much better chance of success than CNN+ ever did. But it still has to convince people its work is distinctive enough to break out the credit card.