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Illustration: Aïda Amer/Axios

Spotify's $235 million acquisition of podcast monetization company Megaphone on Tuesday is the latest in an acquisition frenzy that's stirring up the podcast industry.

Why it matters: The past year has seen several key companies invest hundreds of millions of dollars in podcast acquisitions, including Spotify, iHeartMedia, Apple, SiriusXM and others.

Driving the news: Spotify's Megaphone deal comes on the heels of an investment spree by its rivals.

  • iHeartMedia on Friday said it would acquire the rest of Voxnest, a podcast monetization company. (It owned a minority stake in Voxnest prior to the deal.) On Monday, it announced a partnership with audio production company Pushkin to be its exclusive sales partner for many of its most popular podcasts. (Full disclosure: Axios partners with Pushkin to produce its Axios Today podcast, and also works with Megaphone.)
  • SiriusXM's $325 million acquisition of Stitcher closed last month. The deal gave it access to Midroll, a podcast ad company that Stitcher bought in 2015. This summer, the radio giant acquired Simplecast, a podcast management platform that helps podcasters publish, manage and measure their content. It already owns podcast ad company AdsWizz, which it acquired through its purchase of Pandora in 2018.
  • Apple earlier this year reportedly acquired Scout FM, a startup that creates radio-like stations for podcasts. While Apple has long been the king of hosting podcasts, it hasn't invested as much in podcast monetization through ads.

Be smart: Companies like Amazon, Google and others have also made moves into podcasting, but so far, they have not seemed as eager to acquire new firms to build their audio empires. That could change in the future.

The big picture: For now, podcasting is a small but growing advertising medium. The industry as a whole still only brings in less than $1 billion in ad revenue, even though more than 90 million people listen to podcasts monthly, per Edison Research.

  • But just as Google and Facebook bolstered the digital ad market by aggregating lots of ad tech companies, the same thing is beginning to happen in audio.
  • Companies like Spotify, SiriusXM, iHeartMedia and others aim to grow the podcast advertising market by aggregating podcast services together through deals like the ones struck this week and later securing a chunk of the services' revenue for themselves.

What's next: There are still a few independent podcast companies that are likely to get acquired as the podcast industry continues to consolidate.

  • Apple and Sony are among two firms that are eyeing an acquisition of the independent podcasting studio Wondery, Bloomberg reports. Sources tell Bloomberg that Wondery is seeking $300 million to $400 million in a possible sale.

Go deeper

Dec 1, 2020 - Politics & Policy

Exclusive: Don Jr. tells Georgia Senate voters that Trump is on the ballot

Photo: Eva Marie Uzcategui T./Anadolu Agency/Getty Images

In a six-figure radio ad being released in Georgia today, Donald Trump Jr. tells the state's voters that the U.S. Senate — and his father's accomplishments — are on the line during January's special election, according to audio obtained by Axios.

Why it matters: Trump Jr.'s first of many advertisements in the Georgia Senate races argues the race isn't just about electing the Republican incumbents, but also about preserving President Trump's agenda.

Dan Primack, author of Pro Rata
6 hours ago - Technology

TikTok gets more time (again)

Illustration: Aïda Amer/Axios

The White House is again giving TikTok's Chinese parent company more to satisfy national security concerns, rather than initiating legal action, a source familiar with the situation tells Axios.

The state of play: China's ByteDance had until Friday to resolve issues raised by the Committee on Foreign Investment in the U.S. (CFIUS), which is chaired by Treasury secretary Steve Mnuchin. This was the company's third deadline, with CFIUS having provided two earlier extensions.

Federal judge orders Trump administration to restore DACA

DACA recipients and their supporters rally outside the U.S. Supreme Court on June 18. Photo: Drew Angerer via Getty

A federal judge on Friday ordered the Trump administration to fully restore the Deferred Action for Childhood Arrivals program, giving undocumented immigrants who arrived in the U.S. as children a chance to petition for protection from deportation.

Why it matters: DACA was implemented under former President Obama, but President Trump has sought to undo the program since taking office. Friday’s ruling will require Department of Homeland Security officers to begin accepting applications starting Monday and guarantee that work permits are valid for two years.