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Plus Report - By Thomas Baekdal - September 2019

Premium Podcast Monetization Strategies Explained

The market for premium podcasts is growing although not necessarily in the way we want. While the advertising revenue is increasing, the revenue for premium podcasts seems to be channeled in all the wrong directions.

From a trend perspective, audio is becoming what I call "the third great format for publishers", and if we look at the consumption models around audio, we see so many areas of people's lives where audio works brilliantly. So, the trend is looking amazing, but the monetization doesn't really excite anyone at the moment.

The reason is largely because we haven't yet figured out how to monetize podcasts in any usable form.

So in this 28-page Plus article, we are going to talk about the right way to monetize this, why it is so difficult to do, and also lay down the groundwork for how to change this.

Premium podcast startups don't help us monetize

Before we get to changing things though, we need to talk a bit about the monetization theory. To do this, let's look at the many premium podcast startups that are popping up these days, because they perfectly illustrate why we are not getting anywhere.

At the moment, I see a new premium podcast startup about every month, and they all think they have invented some brilliant new model ... and yet they are all doing basically the same thing.

In short, the model these premium podcast startups are focusing on is this:

  1. Create a platform for podcasts
  2. Center that around some kind of mobile app that includes some type of discovery, some recommendations ... and, to make VC capitalists give them money, they also say they are using machine learning to ... uh... sort the list.
  3. Then they get people to pay the podcast startup money for listening to these podcasts, of which they then aim to give the publishers a cut of the revenue share.

Most of these startups then define the price of all this to be a minuscule amount, because they need it to be cheap to 'get people in'. This of course is great for the startup, because on top of all their VC money, they also don't really have any costs in terms of producing any of the podcasts. So to them, money is like an imaginary object that just comes in.

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Thomas Baekdal

Founder, media analyst, author, and publisher. Follow on Twitter

"Thomas Baekdal is one of Scandinavia's most sought-after experts in the digitization of media companies. He has made ​​himself known for his analysis of how digitization has changed the way we consume media."
Swedish business magazine, Resumé


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