Spotify to pay $250m for the Ringer, bringing its total podcast acquisition spend to $650m in the past 12 months

Spotify is paying $250m for the Ringer, the Bill Simmons-founded sports media outlet that SPOT recently confirmed it will be acquiring following a report that they were in talks.

That figure was reported by Bloomberg today (February 11), which states, citing a source, that “the previously undisclosed price of 180 million euros will be followed by more than $50 million later”.

Bloomberg adds that the value of the acquisition will be detailed in a regulatory filing soon and that ‘the deal requires Simmons to keep working at Spotify for some time’.

The $250m spend on the Ringer means that Spotify has done podcast-related acquisition deals worth over $650m in total in the past 12 months.

Spotify spent $375m in cash on buying podcast companies last year – across three deals with a total value of $404m.

Those other companies are

New York-based Anchor FM Inc, an online platform which enables users to both create and distribute podcast content, which SPOT bought on February 14 for a total consideration of €136m ($154m).

Next came podcast producer Gimlet Media, for a total deal price of $195m. Spotify acquired the firm on February 15 for a total consideration of €172m ($195m), consisting of €170m ($193m) in cash. The remainder of this purchase price (€2m) was “related to the fair value of partially vested share-based payment awards replaced”.

Founded in 2014 by Alex Blumberg and Matt Lieber, Gimlet creates podcasts like Startup, Crimetown and The Pitch.

After Gimlet and Anchor came Parcast, which Spotify acquired in April 2019. The company was founded in 2016 and has launched 18 premium podcast series including Serial Killers, Unsolved Murders, Cults and Conspiracy Theories and the studio’s first fiction series, Mind’s Eye. The total price of that deal: $55m.

Spotify confirmed last week that it ended December 2019 with 124m Premium subscribers and 271m total Monthly Active Users (MAUs) worldwide.

That subscriber number was up by 11m on the 113m Premium subs base the platform hit at the end of September 2019 – representing an average per-month subscriber growth rate in Q4 of 3.66m.

SPOT told investors that, at the close of December, over 16% of its 271 MAUs were listening to podcasts – approximately 43m users.

In other words, the number of people accessing podcasts on Spotify grew by around 8m, or 23%, from the end of Q3 2019 to the end of Q4 2019.

Speaking on a Q4 earnings call last week, SPOT boss Daniel Ek noted that total podcast consumption hours on Spotify in Q4 2019 grew by nearly 200% year-on-year.

“[That 200% figure] is a global phenomenon,” he said. “It’s not just a US phenomenon.”

He also suggested that “podcast users are not only more engaged [with Spotify] overall, but because of that engagement they’re also listening to more music”.Music Business Worldwide

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