Diversifying Content

When people complain about podcasts & audiobooks being integrated into Spotify, I often remind them that the "pod" in podcast comes from iPod. And that before iTunes did this very thing, integrating podcasts & audiobooks, they were just called "internet radio shows." Apple only trifurcated these features from iTunes into Apple Music, Apple Podcasts, & Apple Books in 2019, which they can do because the apps come pre-installed on Mac & iPhone products, & it allows the designers to create highly tailored experiences for each content type. It's good to be the king of your own castle, apparently.

If Spotify were to launch separate music, podcasting, & audiobook apps, a lot of folks would be very happy about that. Podcast apps obviously create a better experience for podcast listening than music apps. But artists tend to benefit from these formats being bundled. Well, depending on how this is framed.

The caveat is... yes, it is kind of a bitch move for Spotify to reclassify family/duo plans as "bundles" in order to qualify for a lower royalty payout to publishers & songwriters. The courts ultimately agreed with Spotify, but we know that when the publishers signed the agreement, "bundling" was understood to mean bundling a Spotify & Hulu, or a music subscription with an audiobook subscription. So that legal technicality is wack.

But what artists don't seem to understand is that when a user signs up for Spotify premium with the primary intent of listening to podcasts, 70% of their subscription fee goes to the music royalty pool, & Spotify monetizes the podcasts themselves through advertisements. So if a user is contributing to the music royalty pool & only listening to podcasts, their contribution benefits all artists receiving plays for that month.

Even with Spotify's $200m deal with Joe Rogan in 2020, this money came out of Spotify's operating budget, not the royalty pool. And was recouped through ad sales. The users who followed Rogan to Spotify & signed up for premium accounts then contributed to the music royalty pool without necessarily diluting it with music plays.

This was controversial at the time. One of the biggest media controversies of the covid era, in fact. And people cancelled their subscription to Spotify & signed up for Apple Music. The irony is, of course, that before Rogan signed the exclusivity deal, Apple was carrying every Rogan episode. And as a part of the renewed deal, Rogan will no longer be exclusive to Spotify. It's returned to Apple Podcasts. So will those users leave Apple Music in protest?

I wouldn't hold my breath for it.

I understand disagreeing with Joe Rogan, & even being disappointed with society that his podcast commands hundreds of millions of dollars. But if you're going to endorse censorship, Joe Rogan is an odd place to start. Spotify 's library is chock full of controversial content. GG Allin. 2 Live Crew. Charles Manson. Do we just start taking takedown requests from any concerned citizen?

That sounds like some PMRC shit to me.

Spotify has given justifications for their move to diversify content. Mostly it relates to the fixed percentage of revenue when it comes to music. In other words, the percent of revenue they have to share with artists is non-negotiable. And so their only way of increasing profits (as capitalists are wont to do) is to add an upsell charge for audiobooks or an advertising revenue stream for podcasts. I'm not here to defend this business strategy. Only to to suggest that these new types of media are not directly competing with music royalties, as many seem to believe they are.

There's room enough in this here town for music, podcasts, & audiobooks, I believe.