Spotify combines podcast studios and shrinks workforce
Spotify is combining two divisions in a cost-cutting move that will hit its podcasting business after years of extravagant spending.
Why it matters: Spotify is one of the biggest names in podcasting with more than 100 million listeners. The move shows that its explosive growth came at a significant cost.
Driving the news: Spotify announced Monday it was combining Parcast and Gimlet into one operation called Spotify Studios and reducing its podcast division by about 200 people, or 2% of the company's workforce.
- Jemele Hill has moved toward ending her relationship with Spotify, which exclusively distributes the "Jemele Hill Is Unbothered" and the shows in her Unbothered Network, Bloomberg reported Friday and Axios can confirm.
Context: The above chart is not all inclusive but provides a snapshot of some big names Spotify has signed over the past five years.
- In 2019, Spotify touted deals with Jordan Peele, Paul Feig, Mark Wahlberg and Lele Pons. It later signed Duplass Brothers Productions and Addison Rae. Not all of these have seemed to result in content, however.
- Some of the former Spotify exclusive podcasters have signed deals with competitors. Higher Ground moved to Audible. Esther Perel is now part of the Vox Media Podcast Network.
Of note: Beyond exclusive licensing deals, Spotify had spent big on podcast-related acquisitions such as Gimlet, Anchor, Parcast and Bill Simmons' "The Ringer."
What they're saying: Spotify CEO Daniel Ek has been open about the changing strategy.
- "In hindsight, I probably got a little carried away and over-invested relative to the uncertainty we saw shaping up in the market. So we are shifting to focus on tightening our spend and becoming more efficient," he said on the company's earnings call in January.
