Hollywood Seeking Foothold in $314M Podcast Industry
Agents and media executives are no longer just focused on exploiting IP for film and TV.
A series of traditional media moves into podcasting signal that the niche audio medium is poised to get a lot louder.
On Sept. 13, iHeartMedia announced its ambition in the mobile-first format with the acquisition of Stuff Media for a reported $55 million, and WME owner Endeavor unveiled plans for an audio division that already has recruited TV super-producer Dick Wolf, among others, to make podcasts.
The deals showcase a shift in how Hollywood is approaching the space. No longer are agents and media executives focused purely on exploiting podcast IP for film and television. Now they are seeking a foothold in the fast-growing industry, which with $314 million in revenue last year is still small — but is expected to grow 110 percent to $659 million by 2020.
"The business of audio is just starting to form," says Endeavor Audio marketing head Lisa LaCour. With legacy media organizations like The New York Times now citing podcasts as meaningful advertising businesses, Endeavor also saw an opening. "We're starting to venture more into original content. The company determined that podcasting and audio storytelling in general is a big opportunity to continue the growth."
For radio broadcaster iHeartMedia, which offers more than 20,000 podcasts on its app in addition to operating a small original podcast division, acquiring the 50-person Stuff Media — the company behind shows Stuff You Should Know and Atlanta Monster — immediately supercharged its position in the space. "It doubled our size overnight," says iHeartMedia Networks Group president Darren Davis. "If this acquisition doesn't signal our intention to be the leader [in podcasting], I don't know what does."
But the maturing of the space has also led to some upheaval. Just as iHeartMedia and Endeavor are making their push into podcasts, two longtime players in the space have backed out. Slate Group's Panoply has said it will no longer produce podcasts, switching its focus to hosting and advertising technology, instead. The move coincides with the departure of Slate chairman Jacob Weisberg to form a new audio company with Revisionist History host Malcolm Gladwell. BuzzFeed, too, has said it will stop producing podcasts in-house.
The disparate moves have led some in the industry to question whether podcasts are primed for growth. But observers suggest it's a sign that the space has reached a point where only those who invest fully will continue to thrive. Now, it will be all about finding the right formula to broaden the audience for this business. "There hasn't been enough content out there that has generated motivation for people to go out and seek it," acknowledges LaCour. "That's one of the things we're looking to solve."
A version of this story first appeared in the Sept. 20 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.