The Podcast Market is Changing, but Will the Bubble Burst?

In the past months, the podcast market has seen significant changes. Buzzfeed announced it was ending most of its podcast production while the online magazine Slate announced a renewed focus on podcasts.

However, across the industry podcast advertising revenue soared.

The Interactive Advertising Bureau (IAB) found that podcast advertising revenue rose more than 80 percent from $169 million in 2016 to $314 million in 2017 and predicted the growth was likely to continue, reaching potentially $659 million by 2020.

Increased spending on advertising during podcasts reflects the growth podcasts have seen within the media industry in the past few years.

According to Edison Research, a market research firm which conducting polling on podcasting, 44 percent of Americans have listened to a podcast and 17 percent, an estimated 48 million people, listen to podcasts weekly.

Many media outlets have responded by focusing more resources on producing podcasts. In January, Julia Turner, the editor-in-chief of the online magazine Slate, said that the magazine would be renewing its focus on podcasts in the future.

Between 2014 and 2017 the percentage of Slate’s revenue that came from podcasting increased from 0 to 25 percent, NeimanLab reported.

“We’re planning to expand editorial spending on podcasts and articles,” Turner told NeimanLab, “There are good economic models behind both.”

Since the announcement nine months ago, Slate announced a number of leadership changes that further reflect the apparent focus on podcasts in the media industry.

Steve Lickteig, the former executive producer of Slate podcasts announced this month that he would be leaving Slate to become executive producer of audio and podcasts at NBC News and Jacob Weisberg, chairman of the Slate Group, announced that he would be leaving to form a new company with Malcolm Gladwell, author and host of the podcast Revisionist History.

However, not all media outlets seem to be responding the same way to the explosion of podcasts as part of the industry.

In September, the Wall Street Journal reported that Buzzfeed was shutting down much of its podcast production. Instead, focusing on individual projects and creating teams to work on them as needed.

The decision was made in response to difficulty finding a big audience audience, a Buzzfeed reporter said.

Buzzfeed’s announcement came around the same time that Panoply, another podcast media company, said it was leaving the podcast content business to focus on hosting and advertising services and Audible, the audiobook company owned by Amazon, announced it is scaling back on its own original podcast production.

Changes like the ones seen at Buzzfeed, Audible and Panoply in the last month have prompted another discussion—is there a podcast bubble and if so, is it bursting?

According to Nicholas Quah, author of NeimanLab’s Hot Pod newsletter, and Mathew Ingram of Columbia Journalism Review, the answer is “not really.”

For one, the concern about a podcast bubble is not new, Quah wrote in a Hot Pod newsletter, last month.

“For as long as I’ve been writing this newsletter, there has always been talk about the podcast bubble,” he wrote, noting that the same question was asked at a panel in 2015.

While there might be “bubble-like” behavior, Quah wrote, perhaps a more relevant question is whether the podcast market is remaining open in the way that it once was.

One of the benefits of podcasting that is frequently cited is its low barrier to entry. A podcast can be produced and shared online through a number of platforms at relatively low cost, making them appealing to individuals and smaller media outlets.

Low barriers to entering the podcast market mean that podcasts focusing on niche subjects with smaller audiences can exist in a way they cannot in other, more expensive or limited mediums such as television.

While more podcasts may not necessarily be contributing to a podcast bubble, as Quah argues, they are contributing to a more saturated podcast market, making it competitive for podcast producers, like the ones at Buzzfeed, to find listeners.

Podcast producers are also competing for quality, Ingram points out.  

“As often happens whenever the crowd moves en masse into a new format, the quality of podcasting also suffered,” Ingram wrote, “none of this is to say that podcasting is dead—just that, like anything else, it requires an investment of time and money to do well, something that not every media company has a lot of right now.”

The bubble, if it exists, may not be bursting yet, but the media landscape around podcasts is becoming increasingly expensive and introducing new challenges for producers.

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