“Do you find music or technology more interesting?” Asking the question this time is who should answer, but Dawn Ostroff, Spotify’s Chief Content & Advertising Business Officer, was born as a journalist. And then she was her, anchorwoman, producer of successful TV series, president of several television networks. We meet her in the new Spotify headquarters in Milan, which is also the headquarters for all of Southern Europe: around a hundred people work there, from ten different countries. A tangible sign of the growth of the platform, which counts today 433 million usersincluding over 188 million Premium subscribers in 183 countries. And that by 2030 it expects one billion users and 50 million creators.
New trend
Podcast boom in Italy, and it’s (almost) all thanks to Spotify
She joined the Swedish company in 2018: back then Spotify was essentially synonymous with streaming music. And today?
“Our mission has always been to allow millions of artists to create their content and distribute it for billions of people to listen to. Now that we are the largest music platform in the world, we try to become the largest audio platform in the world as well. It is a white space. With podcasting we started from scratch about four and a half years ago, and for a few months we have been first in the United States, where the landscape is very, very competitive. We have 4.4 million podcasts available globally and in the second quarter of this year alone we produced 100 new ones; in Italy we made 22 in one year ”.
How do you explain the podcast boom?
“Podcasts allow a very intimate connection with those who make them. Emotional engagement is deeper, and therefore allows for a more significant impact for advertisers. The impact of digital audio on Spotify is much stronger: 9% more than other digital audio platforms, 23% more than television, 19% more than radio. We have seen a huge growth in podcasts, which has shown us that we can have music as the core and expand to another vertical. The next will be that of audio books ”.
No video?
“Not necessarily, we have recently started adding videos to some podcasts and the first experiments are very positive. There are also videos in the songs, for some years now, and they will grow: I think it is very important for us to offer artists and creators a wide range of ways in which to create and show their art ”.
You cast Barack and Michelle Obama, Prince Harry and Meghan: how are celebrity podcasts doing?
“The deal with the Obamas expired, while the Meghan Markle podcast started about three months ago, but we suspended it for a few weeks out of respect for the royal family when Queen Elizabeth passed away. Since its launch, Meghan’s podcast has been in the top three or four most followed in the world, it talks about a topic that I think interests many women, that is to be labeled as certain archetypes: the ambitious, the diva, the one who doesn’t want to get married , and so on. There are always important guests, like Serena Williams, Mindy Kaling, Mariah Carey ”.
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How do you measure the success of a podcast?
“For us, what counts is the number of people who listen, the duration of listening, the liking or disliking of the show by advertisers, but there is a combination of parameters that we insert into a formula and that allows us to determine the success of a podcast. Some have become very popular, for example those of Dax Shepard or Joe Rogan. An unexpected problem we are facing is the difficulty in finding technicians who know how to make podcasts. We went to American colleges and universities and said, “Have you thought about having a podcast program as a degree program in some schools? We have worked with universities in New York and Southern California, agreements with others are being discussed. . For those young and thinking about a career, working in podcasts today is an opportunity not to be missed. You need many different skills, not just those required for radio, you have to understand the metrics, study what works and what doesn’t, be ready to change everything during the race “.
Yes, because, unlike radio, listening to a podcast can be measured with great precision …
“We try to help creators as much as possible, as we do with musicians. For example, in regards to music, they can figure out what their metrics are, how many streams they have had, how long people have listened to, but they can also use Spotify to determine where certain songs are most listened to, so that when they plan their tours know which cities to visit and which songs to play. So it’s a really great way to use data to grow the career of a music artist or podcaster and ultimately an audiobook writer as well. “
And you also need the data for advertising.
“The podcast business model is different. With music, most of the proceeds are paid to labels and record companies. For podcasts, until recently the author was responsible for selling the advertising, the commercials were inserted by those who published them. Now, if the content is exclusive, we are responsible for selling the ads, we already have a dedicated team, and we are building an advertising platform called Span (Spotify Audience Network), which allows us to give advertisers the same transparency, the same data and the same analytics they get when they buy on any other digital platform, but which for some reason were not available for podcasts and audiobooks until now. “
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How do you imagine the advertising market will change in the coming years?
“I believe it will change significantly. If we think about how big the advertising market is, and analyze how it is divided, we see that the bulk is in the hands of Google and Meta, then there are Microsoft, Snap and Twitter, but it remains a relevant space for traditional media. A space that is dwindling rapidly as many people abandon traditional media. Add to this the fact that streaming platforms, such as Netflix and Disney +, are starting to explore advertising – so a lot of advertising investments will shift to digital. And of course also towards Spotify: soon we will be able to compete with names like Snap, Pinterest and Twitter, and we expect that, in the not too distant future, advertising will represent about 20% of our turnover. An enormous growth, for a company that up to now has focused almost everything on subscriptions ”.
Do you think there is room for paid podcasts too?
“We have, and will continue to have, we want to offer creators every possible way to monetize. We have launched a no-cost program for creators, who will receive 100% of their subscription revenues, excluding payment transaction fees, until the end of the year, and from 2023 we plan to introduce a 5% fee for access to this. instrument”.
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You quoted Joe Rogan: There has been a lot of controversy over the past few months about unscientific theories that he made space for in his podcast. What is Spotify doing against the spread of fake news on podcasts?
“There is a lot to do, but we are learning. We have considerably expanded the internal trust and security team and created a Security Council with experts from different areas – we turn to them for guidance on how to behave. Also recent is the acquisition of Kinzen, considered the best technology company in the trust and security sector. Use our data and artificial intelligence to understand what’s being said in podcasts and identify potential fake news. Having a secure platform is essential for us, it is a responsibility that we take very, very seriously. And it is not a goal that we can consider achieved once and for all, it constantly moves and we continue to grow and learn, even starting from the experience of other companies “.
Spotify recently announced the acquisition of Sonantic, a London-based startup famous for creating artificial voices very similar to natural ones. Will you use it to turn books into audiobooks?
“There are several companies that convert text to audio and there are several ways we can use the functions developed by Sonantic. The possibility of converting text into speech is interesting, but it also offers us other opportunities that I cannot yet talk about ”.
Podcasts are often associated with listening on the go, perhaps to or from the workplace. Have they been affected by the pandemic, the lockdown, or smart working?
“We have seen important changes, for example in Brazil, with a collapse of podcasts in the most difficult moments of the pandemic. But then the ratings started to grow again, and today they are higher than before. This is true globally: last quarter we saw a significant growth in our monthly active users: people are on the move again, it’s true, but we always remember that a podcast is also listened to at home, while cleaning, or outdoors, while running or walking, in the gym, and on a thousand other occasions. It is the advantage of a medium that keeps the ears and the brain busy and leaves room for everything else ”.
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