A quick review of audio developments

I’ve covered a lot of different issues over the past ten months. Often there’s a topical hook and sometimes just an old soapbox is dragged from under the sofa. Occasionally a bit of both.

Looking back there’s a few trends that are starting to form that will define much of the next 18 months.

It’s hard not to think that subscription in some form will be tackled by more media companies. The rise of subscription options for prolific users on Facebook/Twitter, the recurring revenue opportunities to be deployed by Apple and Spotify, writers abandoning titles for Substacks and even Bauer rolling out a subscription option for their listeners. All of this is enabled by digital ubiquity for the vast majority of consumers. Digital TV, DAB, Smart-speakers, tablets, mobiles etc with the ability to cast and stream wherever. It’s never been easier to have your content consumable. Providing they know that it exists.

So, today, I wanted to do a few pick ups on stories I’ve written about with short, extra thoughts.

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Bauer Subs

Last week I talked about Bauer’s subscription offering – a £3.99 version that gets you an ad-free main station, 20 spin-offs and skippable tracks.

I registered and had a play last week. It’s been executed pretty smoothly. There were a few teething troubles in the app post-subscribe and the skipping did skip me back to a previously skipped song, but I imagine these bugs will be ironed out. The general feel of it was good.

What was surprising, and not particularly well messaged, was that your £3.99 gets you access to the subs offering of Jazz, Scala, Kerrang and Planet Rock. It’s not one, but all. With the addition of more stations, particularly their big hitters of Absolute, Kiss and Magic, it becomes a much more attractive offer. Especially if you listen to a lot of their brands on IP devices.

I don’t think it solves my issue of providing a deep brand experience beyond IP listening (which the stations and Bauer aren’t really resourced to deliver) but as a value proposition there’s definitely something to it.

Podcast Subs

I did a deep dive on Apple’s subscription podcast offering, following up on Spotify’s similar announcements. I worried that there would be some mis-alignment of the two, not helping out podcasters who would find it difficult to tell their subscribers to do something simple.

Sadly I was correct with that. Apple’s option allows a single podcast to become part-subscription or subscription-only, but it’s main focus is Channels. The grouping together of content and selling it as a bundle. So, you might pay a fee and get all of The Athletic’s podcasts ad-free, rather than having to individually subscribe to all the ones you like.

Over at Spotify, it seems very single-show focused with no similar concept to Channels. So, The Athletic are able to offer early access to all their 85 podcasts on Apple for 99¢ a month, but couldn’t replicate the same deal with Spotify. The best they could do would be to offer special access per podcast at Spotify’s pre-ordained price-points of $2.99, $4.99, or $7.99.

Spotify, of course, faces a key issue in that they can’t offer in-app subscription purchases (otherwise they’d have to share 30% of the income with Apple) so the sign-up flow bounces you to Anchor, requires sign-in, credit card submissions and then bounces you back out again. Whilst that is unlikely to be resolved (unless Epic win their current court case against Apple’s App Store), I’m still hopeful that Channels functionality will appear on Spotify eventually.

It always seemed like much of their subscription plan was based on what Apple might do, which probably necessitated some guess-work on their behalf. The fact that it’s available in limited Beta, in the US would seem to back that up.

Scale and Consolidation

I talked a bit about audio consolidation a few weeks ago. It’s mainly been US based, with lots of vertical audio integration with radio groups buying podcasts assets and ad tech etc.

Yesterday, SiriusXM announced the entirely unsurprising step to bring together all the sales teams of their various acquired businesses – SiriusXM, Pandora, Stitcher, Midroll – into one division, SXM Media. Collectively they reach 150m listeners, describing it as the largest digital audio ad platform.

In the UK (and around the world now) Global have DAX for podcasts alongside their UK radio and outdoor sales operation and Bauer and Wireless have united much of their digital audio inventory through their Octave joint-venture. It does seem a little more piecemeal than the more aggressive stance we’re seeing elsewhere. For example is a national stand-alone non-digital sales house for Wireless still a sensible thing to do? Or is this the sort of thing that will be sorted out if Global ends up buying more/all of iHeart.

Auntie

All of this collectively causes trouble for the BBC and BBC Sounds. The BBC’s audio content remains high quality, broad and popular as well as being well marketed, but the nature of the organisation makes it difficult for it to embrace much of the direction of travel for the audio sector.

The BBC are keen for Sounds to be a key home for UK audio consumers – music, radio, podcasts from the Corporation – but also the often mentioned third party content too. Whether commercial radio stations or third party podcasts – it seems to remain on the product plan but no sign of delivery.

With the growth of subscription offerings, that the BBC will find almost impossible to be able to integrate into Sounds, it seems mad that they haven’t co-opted the ‘free’ audio market from third parties quicker. Why they didn’t start with integrating Radioplayer into BBC Sounds, which has done much of the heavy lifting around free audio, still surprises me.

In addition, trying to sellotape the BBC Radio commissioning model into podcast and IP content is a non-starter. I may need the BBC to commission my strangely-specific, 5-part, 15-minute, up-market, passion-project and so I’m happy to take relatively restrictive terms. It will only likely be suitable for Radio 4 after all. However, with so many different and more lucrative on-demand audio opportunities (subs, ad networks, platforms etc), the idea of maybe not speaking to the BBC’s Business Affairs team seems a pretty easy one to take.

Podcast Day 24

There was a good response to my plug for the Podcast Day 24 conference last week. If you skipped that bit, we’re organising a 24-hour online podcast conference with segments focused on Australia, Europe and North America. There’s an amazing array of speakers, but if audio strategy’s your bag, we’ve managed to get Conal Byrne, who runs all of iHeart’s digital offerings, including podcasts to speak. There’s also an update from Amazon Music on their podcast offering and speakers from CBC, NPR, BBC, ABC and other non-acronym companies too.

It’s only £99+VAT to watch live (or catch-up), but to you, dear reader, £75+VAT if you use the code BPAINSIDER at podcastday24.com.

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Five months into 2021, what ideas are emerging?

Bauer and GB News Go Subscription

My predictions for GB News. It will have a good first week. Andrew Neil will ‘beat’ the news channels. It won’t be as right wing as people think. This will likely annoy the more gammon-y end of the market. Some of it will look a bit cheap. Some of the new presenters will find this stuff is pretty hard and the guests, outside of Andrew Neil, will be a bit average alongside loads of Tory MPs.

Its ratings will drop off pretty quickly. They’ll be lots of ‘according to BARB no one was watching these shows’ and they’ll come back with ‘look at all the retweets we’re getting’. Less people will watch Andrew Neil.

The resonating stuff will be all the right-wing malarkey and six months in they’ll have a mini re-launch and it’ll be all blowhards, all the time. The BBC imports will be moved to the edges. Andrew Neil will start to be a bit uncomfortable with the company he’s keeping and will end up doing a weekly show as he’ll say he needs to spend more time with his business interests and that this was always the plan.

Of course in the old days, this would be accompanied by ‘advertisers are abandoning ship’ news coverage. This time I’m not sure that’ll really matter.

It seems, according to the FT, that the telly bit is really a loss-leader and their real aim is to sign-up superfans to a fiver a month voluntary subscription. For this extra money you’ll get exclusive access to GB News ‘talent’, newsletters, podcasts, forums, events etc.

It’s not a bad idea at all. There’s a good chunk of people who want to use their support of the channel as a badge of honour to ‘own the libs’ and battle the woke etc, extracting £5 off them is probably relatively easy. The ideologically similar Telegraph’s had a great lockdown with over 400,000 digital subscriptions and overtaking The Times.

Subscription businesses are all about funnels, getting as many people in the free, top bit and then getting better at converting them to paying subscribers at the other end. A well-distributed TV channel generating loads of right-wing Twitter indignation is probably a pretty good way to do that.

With conversions based on passion, some decent features and importantly good community building, there’s probably a chance to keep churn low.

With TV news channels notoriously unprofitable, looking at a different model will be essential to any success they have.

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Bauer’s Subscription Announcements

Bauer’s taking a somewhat different approach, announcing yesterday that they’re going to make subscription versions of Scala, Planet Rock, Kerrang Radio and Jazz FM.

For £3.99 a month you’ll get an ad-free version of the main station and the ability to skip (every hour up to six) songs, 20 spin-off channels per service and some ‘special content’.

This isn’t the first go at subscription radio, in fact Planet Rock, under the previous owner did their own £4.99 subscription service in 2012. It was different times then, but the listeners were unhappy and the owner Michael Bluemel even sent a grumpy open letter back to them. Perhaps unsurprisingly he sold the station three months later.

I think the Bauer execution will likely be a pretty good one and with online listening on web, mobile and smart-speakers spanning many listening environments, having something that works across all of them makes sense. It’s important to remember that we’ve only been able to do that relatively recently.

Subscription though needs to be a scale-led business and if you’re involved with digital music then there’s quite a few costs before you get going. So of the £3.99, take off VAT, you’re down to £3.33. Strip away the 30% Apple will take, you’re left with £2.56 and, assuming you’re paying around 75p per subscriber for music rights, you’re left with £1.81. And that’s before you’ve spent any money on the technology, additional content or the marketing.

10,000 subscribers might pay for the tech costs, and the next 10,000 might pay for the content team. However, once you’ve cleared that hurdle there’s pleasantly little variable costs for adding new subscribers (though you do need to spend some money on keeping the ones you’ve already got).

Making it a success for a single radio station might be hard, but re-deploying the gear for lots of stations, not just in the UK, but across Bauer’s European portfolio, might have a better chance of adding a new revenue line for the company.

The product they’re launching though seems pretty function-led. To me, the key value is probably the ad-free listening. If I listen to Jazz FM on internet-connected devices all day, £3.99 is probably a good investment to lose the ads. I think they’re the first type of subscribers. The second group are probably the completist superfans of the stations. Like the GB News fans above, they’re the people that have the strong emotional connections to the station.

I think there’s a big opportunity in that group, not only to get them to give you money every month, but using it as a catalyst to strike up an even better relationship. That could be things that generate greater value – through products, like events or merch or even by charging more a month. The challenge though is it requires real effort at customer relationship management and working out ways to provide more value to these superfans.

It would be such a waste if all the heavy lifting that was done to get the technology to work isn’t then supported in ensuring the experience continues to be a good one. Listeners get annoyed when the things you think are benefits turn out to degrade the experience:

A purely functional experience – ‘no ads’ – once the wrinkles are ironed out, is easy to deliver but runs the risk of keeping yields (and success) low. This means you spend more and more effort getting people in the top of funnel, but the real benefits come from working out how to widen the bottom bit – so more people sign up.

Podcast Day 24 – Monday June 7th.

With my British Podcast Awards hat on, we’ve been working with the Radio Days Europe team to create an amazing online event – Podcast Day 24. It’s three conferences on the same day – for Australia, Europe and North America. Your ticket means you can watch all of them, live or on-demand.

In the Europe leg we’ve got a great selection of sessions including what makes a hit show with The Receipts and a guide to commissioning from Acast’s Clarissa Pabi and Spotify’s James Cator. RedHanded are one of the world’s most successful podcasts on Patreon – generating over $60k a month – find out their tips to be successful.​ Fearne Cotton will tell the story of building a mindfulness brand around her number 1 podcast. We’ve also got Adam Bowie talking trends and Tony Phillips (ex BBC and WNYC) reflecting on lessons from the past and how they might offer direction and clarity for the future.

Outside of the UK, we’ll hear from Genstart: Denmark’s No.1 Podcast, NDR’s chart-topping Coronavirus podcast, Rasmus Kidde from Denmark’s DR on appealing to different demographics, Petter Sommer from NRK about using Dogme rules for podcasting, ARD’s award-winning youth history podcast, seeing how Whatsapp works for podcasting, newspapers and podcasts and still more to be announced…

And that’s just the Europe leg! We’ve got over 20 more sessions from Australia and North America from the likes of iHeart, Spotify, CBC, NPR, ARN, Mamamia, the ABC, Triton Digital and Amazon Music.

Tickets are £99+VAT, but you, dear reader, can get them for £75+VAT (if you use the code: BPAINSIDER). See, a real subscriber benefit.

If podcasts are any part of your career or business, this will be the essential event for you and your colleagues. Sign up at podcastday24.com and I’ll see you on Monday 7th June!

More places want your money every month

Why Building Scale is Essential to Podcast Success

I was somewhat taken by a line in the press release announcing that Roman Mars’ 99% Invisible has been acquired by SiriusXM’s Stitcher unit. He says:

I want to be with the company that launches new projects, and Stitcher provided us a unique opportunity to focus on the art of creating, developing and producing content we know our listeners will love, while freeing me of constantly thinking about the business of podcasting. (emphasis my own)

Whilst I’m sure it’s not the only reason, I can imagine there’s a certain amount of relief in cashing in your business chips and returning back to the thing you love (the audio) rather than holding out for something that may never come, or worrying about being left behind whilst your medium changes around you.

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Right now seems a point of real change in podcasting. If the first 15 (!) years were about establishing the format, experimenting, and general growth, I feel the second wave of the sector is about to kick off.

We’ve seen consolidation of the operators to large groups that encompass content, hosting and monetisation (predominantly Spotify, SiriusXM, iHeart, Entercom/Audacy). The big players making, er, big players – Apple, Spotify, Amazon, Google and now Facebook. We’ve seen the tighter integration of ad agencies, networks and standardisation of programmatic exchanges (removing lots of barriers about getting ads into podcasts). This then leads on to the now two core models for audio. The first being Ads, and now with the two big players in the game – Apple and Spotify – Subscriptions.

Podcast discovery, like all digital discovery, is a challenge for operators new and old, but the people who are more likely to do well are those with pre-existing awareness (or their own non-podcasting marketing efforts) or organisations with podcast scale.

Podcast Scale

If you look at Apple’s US top 100 podcast chart (yes, disclaimers about not being a real chart etc) most of the shows are parts of networks – Wondery, NBC, New York Times, Audiochuck, iHeart, NPR, Barstool, Pineapple, Parcast etc.

Some are established media companies, some are newer entrants, but they are growing by having a suite of programming that’s either similarly toned, targeted or cross-promoted. This cross-promotion can come from ads in their shows or building an understandable parent brand “oh, it’s a new Wondery podcast, I’ll try that”.

Looking at the UK chart there are some UK operators who are benefiting from this – like the BBC, the Guardian and the power of the US networks makes many of them a key player here too. Global is starting to make a real mark with a mix of brand and talent-led shows alongside many cross-promotional opportunities (in-podcast, radio, outdoor etc). But the more striking observation is how few home-grown networks of scale we have. In the top 100 there are some great exceptions with History Hit and Goalhanger, and beyond that Stakhanov, Broccoli, Crowd Network are starting to build scale, but on from that there’s very few.

We have historically had some strong single shows – Shagged Married Annoyed, My Dad Wrote a Porno, No Such Thing As A Fish, Happy Place – but I think there’s a real danger that new emerging shows will be drowned out, caught between the big UK broadcasters and US networks.

The podcast promotional space is also about to be put under even more pressure, sharing screen real estate with the subscription offerings in Apple and Spotify, and many of those promoted are likely to be value propositions – focusing on large, well-known channels, that unlock a series of shows.

Increasing Output

For anyone that’s wanting to build a real business around their audio output (rather than those extending their brand or are singularly talent-driven) I think it’s essential to work out how to put out a range of shows that reenforce each other and help grow an over-arching brand too. Looking at production outfits putting out disparate concepts without an umbrella that provides familiarity, I feel each launch ends up being the same roll of the dice about whether it catches the audience’s imagination or not.

The shortcut seems to be “lets find someone popular and give them a podcast”. Of course this can be something that works – there’s lots of talent-led successes – but what value does it really grow, and for whom? It is rare for talent to be truly collaborative. They need to be able to look after themselves and be able to take up opportunities that benefit their broader careers – that’s something that’s difficult to partner with. These shows also tend to have limited IP value – as the concept is built around the talent. You’ll always need them far more than they’ll need you.

The great thing about podcasting is that there’s low barriers to entry and anyone can get a show out there. Some of these will be brilliant, others less so. As a medium, audio is also very cost-effective to produce great work and it’s often a joy to work in. I wouldn’t want to discourage anyone from making anything.

But. As we enter this new phase the commercial realities and competition mean that for those trying to build businesses in this sector they surely have to recognise that to be successful they’ll need to change. Spraying and praying that content will work isn’t scalable when the people you’re competing with have strong, integrated, international businesses.

Building a successful show is more than just concentrating on what comes out of a speaker. For UK podcasts to grow, forming networks with complementary content, being laser-focused at serving groups of people or having marketing scale will be essential to ensure you’ve got a decent chance of being downloaded.

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It’s hard to argue with the power of networks

Apple’s New Subscription Podcast Features

We’ve talked about it a fair amount here over the past few months – the rumoured plan for Apple to introduce pay-options for podcasts in Apple Podcasts, and, well, it’s finally here. At the top of yesterday’s Keynote, Apple CEO Tim Cook dedicated 78 seconds to revealing the new features.

I mention the time partly to be mean, but also to point out the revenues of Apple’s hardware and services business are huge cash generators and no matter how important audio is to us, the big boys have much bigger fish to fry. What they’re introducing today in Apple Podcasts is eminently sensible, pretty well thought out and a great opportunity for some creators, but the reason it’s taken so long is that Apple have always had a better way to make a wheelbarrow load of dollars.

What’s spurred this on now? I imagine it’s the huge competition that they face in the audio space, and a need to reenforce podcast consumption on the iPhone and their other devices when Spotify is running amok in the sector.

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Facebook’s New Audio Features

The people behind eight paid-for subscription newsletters – Platformer, Culture Study, Newcomer, Hot Pod, Deez Links, Garbage Day, Galaxy Brain and Zero Day – have joined forces to collaborate on a Discord server – called Sidechannel.

Discord is basically Slack but for non-work things and started off life catering for gamers and streamers. It’s grown to 250million users who use it for a whole variety of things.

For the newsletter folks it’s an interesting member benefit. I’m a subscriber to Hot Pod and I now get exposed to a bunch of cool people chatting and sharing. It adds some friction if I feel I want to unsubscribe, if it does a good job, so has the potential to be positive for all concerned.

It’s first proper day was today and they kicked off with an interview with Facebook CEO Mark Zuckerberg. Not a bad get!

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The Mood of the Nation

The death of the Duke of Edinburgh meant significant, instant changes, to the output of hundreds of radio stations and websites. With consumers used to choice and their favourites, many were surprised to be left without them on Friday afternoon.

‘Obit’ – the obituary policy – tends to get activated by most UK stations on the death of a category one royal (the Queen, Prince Charles, Prince William and the Duke of Edinburgh) or that of the Prime Minister. The plan tends to be to cancel or regular programming and replace it with content suitable for the mood of the nation

Much of this is steeped in history – and for the days when there was only a handful of TV and radio stations, what all good citizens were glued to.

It went hand in hand with the monopoly driven analogue media world. The stations reflected the mood of the nation, that they themselves had probably created.

Today’s Obit genuflecting is perhaps more driven by a fear of what the Daily Mail will say, rather than what it should be, which is reflecting the tastes of listeners or viewers.

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Permission to Break Format

Commercial radio gets a lot of unfair criticism. I grew up professionally in it, so perhaps I always feel that chip on the shoulder.

Many of the things that are spoken about negatively are conversely the things that can make stations successful – tight music rotations, speed links and research-driven content policies.

Much of why these things work on the radio can often get misconstrued as unbreakable rules. Even people who work in the sector often do the things – but don’t understand why they’re there in the first place.

These tactics are just some that are used to achieve the strategy, they’re not a means to an end.

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Suddenly Losing Your Listeners

The pandemic has made us all change. And not just because of the length of our hair.

Whether it’s Zoom, using Amazon Prime, Disney+ or interacting more with the Smart Speaker, the pandemic has been an accelerant. None of these things existed because of Coronavirus, but their utility was certainly enhanced by it.

Indeed, I expect sans pandemic, the growth curves of all of these things would have been steady, but the last 12 months has probably meant they jumped ahead 12 quarters. Zoom made a $16m pre-tax profit in 2019 and a $660m one in 2020.

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Opening Super Followers’ Wallets

My mind is still pretty pre-occupied with thoughts about content, talent and subscription. I think this is a combination of Apple/Spotify’s upcoming subscription podcast thing, a really interesting post on ‘Sovereign Writers’ from Ben Thompson and some questions I was asked about this newsletter by Simon Owens on his Creator Collab Substack.

Talent has always been something that’s in-demand by media owners. Investing in talent generally comes from either supporting someone up and coming (and incurring the cost of money and time to get them where you want them to be) or by paying more for someone that has something that you would like. The general business analysis is whether that investment gives a better return than if you continue with an existing operation.

I’d probably argue that media operations (like all jobs) also have a lot of people who fulfil a function that other people, with some training, could also do. Not talentless, but not often part of the talent equation.

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Follow, Don’t Subscribe

James Cridland does not tend to overstate things or resort to clickbait for his must-read daily podcasting news email – Podnews. So, when he tweeted:

….it definitely resulted in an eyebrow raise.

The news was what could be seen as just a minor change in a podcasting app – but the repercussions are significant.

Apple Podcasts, which is still the core podcast consumption app, is changing the ‘subscribe button’ to a ‘follow button’.

This is the button that signals you want to receive every new episode of a show. It’s also what nearly every podcast in the world uses to encourage their listeners to subscribe to the show.

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