Interview Transcript

In terms of Spotify, they are just licensing Rogan’s stuff. They don’t own it, as such. They have exclusive access, but Apple can easily go and get other podcasts. Clearly, Joe Rogan is the most popular but it doesn’t stop anything from Apple going to get great podcasts and outbid Spotify?

I think the issue for Spotify is, what’s your creative strategy, in building a podcast business?

You mean, what fans are you attracting, to then upsell them?

How do you build enough that is unique, into that, that draws people who wouldn’t otherwise be in your universe? In the end, there are only two places where you are going to make money, at Spotify – advertising and subscription. If you move to subscription, so get rid of the ads, that creates one economic line. The other one is, it’s all ads or it’s bifurcated. I have to watch ads anyway, which is one of the things we were doing at Pandora. Whichever subscription you have, either you’re an ad-supported subscription or a cost subscription, you get the podcasts. Maybe you’ll get a couple of specials, if you’re on the pure subscription model. Those are the sorts of things that I’m sure they are doing.

So for the Joe Rogan deal, he would receive part of the revenue from plays on the ad tier and, obviously, the premium tier, plus an advance. He would get a similar deal to a record label, in effect, do you think?

I haven’t done one of those, so I’m more speculative than I usually am. I’m a little nervous about giving a view on that. If you look at the way that it was announced, they didn’t say anything about how it was organized. They did make clear that it was going to be exclusive, but it was pretty mushy. I don’t know quite what the deal is. But it had to be very rich, because he is a phenomenon at the moment. That was, obviously, important to them. He wasn’t doing badly where he was.

But the point on the business model is, they don’t own the IP.

Think about how valuable a podcast is, that’s all about current activity. How much future value does it have? Howard Stern created huge amounts of IP and he brings it out occasionally and they use it as filler and all of that sort of stuff.

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