What you need to know
- Spotify today launched a new paid subscription service for podcasts.
- It'll enable podcasts to charge their listeners and keep their businesses sustainable.
- Spotify will also let all podcasters keep 100% of their profits for the first two years.
Spotify is expanding its podcasting business today by actually turning it into a business. As had been expected, the company today announced that it would be launching support for paid subscriptions.
From today in the U.S., Spotify will be leveraging its Anchor ownership to extend monetization opportunities to creators. They'll be able to upload subscriber-only episodes to Spotify and select other services. The company will sweeten the deal by allowing them to keep all their profits for the first two years, with a 5% take afterward.
You won't be able to sign up in the app, however, with an external website being necessary to subscribe to your favorite creators. Anchor co-founder Michael Mignano said, via TechCrunch:
It's basically up to every creator to educate their listeners about how and where to subscribe to the podcast, and the actual subscription happens on an Anchor webpage — on the creator's profile page on Anchor. But once you do that and you authenticate it and you come back to Spotify, it'll be unlocked.
Podcasting is a pretty big content business now. Spotify getting into the podcasts business was surprising at first, but with Amazon and then Apple following shortly afterward, it now makes a lot of sense. A ton of people listen to podcasts, and 345 million people listen to Spotify, that's a huge potential audience for podcasters, as well as a lot of potential revenue. It's a bit concerning that Spotify does not break out monthly podcast listeners, but using the more impressive number is a tried and true marketing tactic. It'll be moreso if the company obfuscates similarly next year.
Spotify is opening this first to 12 independent creators who can charge between $2.99 to $7.99 on a monthly basis. Later, it'll expand the program to more creators with an international launch also on the cards.
Anchor isn't the only way you'll be able to leverage paid podcasts on Spotify. The Spotify Open Access Platform will allow creators who already have their own infrastructure for paid podcasts to integrate with Spotify. It's not live yet, though. "We're currently testing the technology and will have more to share in the coming months about partners and features, Spotify said.
