Spotify is launching podcast subscriptions… but it’s not going to make any money from them

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Last week, Apple unveiled Apple Podcasts Subscriptions, which starting from May, will be available to Apple users in 170 countries.

These subscriptions can be started by any individual podcast publisher on the service, with Apple taking a 30% cut of earnings in the the first year of these agreements, and 15% thereafter.

Joining the Apple Podcasters Program will cost podcasters $19.99 per year.

Spotify is now reportedly following suit, with plans to announce its own podcast subscription offering imminently.

Unlike Apple, however, SPOT won’t be charging podcasters to enable subscriptions – and it wont be taking any commission, either.

That’s according to the Wall Street Journal, which, citing a person familiar with the matter, also reports that podcasters using Spotify’s yet-to-be launched subscription service will get to “set their own pricing”.

While the WSJ’s report of Spotify’s own podcast subscriptions launch so soon after rival Apple’s announcement indicates that competition in podcasting is getting much fiercer, the Wall Street Journal cites Spotify Chief Content and Advertising Business officer Dawn Ostroff as stating that there is ‘room for everybody’ in the podcasting space.

“The opportunity in audio is massive. We feel there is room for everybody given the scope and scale of what this medium has become,” said Ostroff.

“Other companies are looking at audio as a side business—it’s our core mission.”

The prospect of individual podcast shows setting up subscription tiers on Spotify – and then netting 100% of the proceeds, with no money staying with Spotify – will surely tingle the tastebuds of the artist / musician community.

Could Spotify one day make it possible for artists to charge fans subscription fees direct for access to certain recordings?

If so, what would the major record companies make of such a mechanism?

Or, indeed, Spotify investors – who already now have to watch the company hand over the full spoils from podcast subscriptions while Apple snaffles nearly a third of them.

The launch of Apple’s new Subscription offering follows rival Spotify’s podcast-related spending spree over the past few years.

SPOT has invested hundreds of millions of dollars as part of its podcast strategy, which has included the acquisition of various companies and deals for exclusive podcast content such as the Joe Rogan Experience.

The company even sent out a user survey in November indicating that it was considering the launch of a standalone podcast subscription service, which Apple has now obviously beaten it to.

As noted by the WSJ, apart from subscriptions, Spotify seeks to generate revenue from podcasts via advertising, a strategy highlighted by its $235 million acquisition in November of Megaphone, a company that provides hosting and ad-insertion capabilities for publishers and targeted ad sales for brand partners.

Spotify was also working on a new interactive podcast ad feature called ‘In-App Offers’ last June, which the platform promised will remove the need for podcast hosts to read out offer codes or web addresses for listeners to redeem deals.Music Business Worldwide