Looking For Leaks In The Lifeboat

Anyone interested in where the podcasting industry is heading probably experienced a world-class case of head-spinning this week. We saw one of the giants of the current business, Panoply Media, abandon the podcast production and network business, choosing to dump the content stuff and just focus on dynamic ad insertion technology. That was followed by iHeartMedia spending $55 million to buy HowStuffWorks' parent company and Ari Emanuel's Endeavor announcing a new podcast division with grand plans and Hollywood glitz. Bust and boom, all at once.

If you're looking at podcasting as an important element of the future of radio and audio entertainment -- if you're looking at on-demand, Internet-delivered programming as spoken-word radio's long-term lifeboat -- this has to be confusing. It seems to be saying that podcasting is either a significant growth field or a disappointment. Thing is, it can be both, depending on what you're expecting.

The Panoply news was sobering, but it rang some bells for me. I used to work with a prominent podcast network that, a few years ago, was one of the biggest. It is not one of the biggest anymore; it's been reduced to a handful of shows, an afterthought in the wake of a dreaded "pivot to video." There are several reasons for this, most of which I plan to save for the book I will never write that nobody would care to read anyway. But among them is something I noticed even then, a malaise setting in among the early podcast business adopters who, in some cases, just got tired of waiting for the business to become, you know, a business, with big revenues supporting big staffs. The revenue hasn't gotten where the early giants of the form expected them to be at this stage, and a lot of the business remains the province of hobbyists. It's hard to blame a company for looking at the numbers and thinking, you know, this isn't worth the trouble right now. And I can think of a bunch of companies that were podcast industry players in the past who aren't players today, so Panoply's move isn't unprecedented, although doing it all at once and firing an entire editorial staff is different. The others just seemed to wither and fade away over time.

That's the dark outlook. Here's the sunny side: Even though podcasting has been around for a decade and the growth isn't quite what it needs to be (take the "massive growth!" stories with several grains of salt, it's still relatively small and concentrated among the very biggest shows), this has all been happening despite several factors that have been working AGAINST growth. We've talked before about the long-term delay in getting Android phone users on board with podcasting due to the lack of a native app, a situation that seems to be changing, sort of, with Google's recent activity; podcasting being an Apple thing got in the way of it being truly mainstream. So has the friction that less technically inclined people encounter in figuring out how to listen to a podcast. You still have to a) market a show to an individual user, and b) in most cases, show them how to listen. It's not intuitive.

That's changing, and, of course, the growth of smart speakers will help, eventually. Right now, it's still a marketing thing. As a consumer, you have to know to ask for something. And you have to be able to do it when you have the time to devote to a half-hour or hour show. That will most likely come when, as we've seen at CES for the past two years, Alexa and Cortana and Siri and Bixby and Google Assistant (that one needs a snappy humanoid name) show up in cars. Too often, people think that everyone has all the time in the world to sit and listen to a podcast, but that's like imagining we all still sit in front of the console radio in the living room, paying rapt attention to Fred Allen. Some people DO have the time, or make the time. Something like "Serial" proves that the right content can get people bingeing on audio. There'll be a lot of money spent trying to repeat that formula. (Sure, more true crime podcasts, bring 'em on. Works for cable TV networks.)

What we haven't determined yet is the best way to make money on these things, and that's what the Panoply move signifies. For them, ad sales didn't cut it, at least to support a large-ish staff cranking out a lot of shows. Ad sales DO support some shows and networks, though, so I wouldn't count it out. (And I wouldn't assume that those ad sales cannibalize radio revenues, either. At least, it doesn't have to be. I hope that radio AEs selling station podcasts aren't using them as just additional radio inventory or value added; especially when it's host-read native advertising or branded content, podcasting is a different, more effective, highly targeted advertising medium, and it shouldn't be lumped in with radio, which is an effective reach/frequency vehicle and a different selling proposition.) I'm not sure if there's ultimately a long-term play in subscriptions or "premium" packages, but you can see where Endeavor's play is clearly to use podcasts as a proving ground for concepts and content that they can take to TV and movies, and you can see some shows taking in revenue from live events and merchandising. But the ultimate business is still to be determined. Some folks aren't going to want to wait for that to happen, or can't. Others can afford to stick it out. And if you're a podcaster or thinking about doing it, as long as you neither assume you can immediately make a good living from just podcasting or you can look at it as a creative outlet or a stake in the future, and you have the time, there's no reason NOT to do it.

TL;DR: Draw no conclusions from this week's podcast business news. Yet.

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Did someone say podcasting? Yeah, I do one, too. My podcast is "The Evening Bulletin with Perry Michael Simon," a quick (two minutes or less) daily thing, and you can get it at Apple Podcasts/iTunes, Google Play Music, iHeartRadio, TuneIn, Stitcher, and RadioPublic. Spotify, too. Google Podcasts? Click here. You can also use the RSS feed and the website where you can listen in your browser, or my own website where they're all embedded, too. And if you have an Amazon Alexa-enabled device, just say "Alexa, play the Evening Bulletin podcast."

You can follow my personal Twitter account at @pmsimon, and my Instagram account (same handle, @pmsimon) as well. And you can find me on Facebook at www.facebook.com/pmsimon, and at pmsimon.com.

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Perry Michael Simon
Vice President/Editor, News-Talk-Sports and Podcast
AllAccess.com
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