Apple launches paid-for podcast service

Apple is to add a subscription option to its podcasting service as challenges to its once dominant podcasting app mount, specifically from Spotify.

Why it matters

Because podcast content will go through Apple, podcasters won’t receive information about their subscribers, such as email addresses or other contact data. But, as Apple’s reach is vast within the US smartphone market – where the podcast market is biggest – the company is betting that what podcasters lose in data, they will make up for in subscription revenue. 

The details

• Content will continue to be free, but from next month, as part of an overall redesign of Apple’s app, podcast listeners in over 170 countries will have the option of signing up to subscriptions in exchange for a premium service offering bonuses, such as ad-free listening and exclusive and early-release content.
• Podcast creators will be charged 30% of subscription fees by Apple for the first year, reducing to 15% afterwards, so incentivizing podcasters to offer perks to keep subscribers on board.
• In March 2021, Spotify edged ahead of Apple Podcasts in monthly downloads, according to data from podcast hosting company Buzzsprout. Spotify announced its own plans for subscriptions earlier this year.

Key takeaway

Podcast advertising in the US is expected to top $1 billion for the first time in 2021 as its share of total digital audio ad spending continues to grow.

Sourced from The Verge, IAB