According to Spotify latest earnings calls, the number of podcasts on the platform was 2.2 million as of the end of 2020. This is up from 700,000 at the end of 2019.
Spotify’s Q4 2020 earnings call showed how stay-at-home orders enforced by the pandemic helped the music streaming and podcast platform continue to grow. The call announced the platform now has 345 million monthly active users, up 27% year-over-year, as well as impressive podcast library and consumption numbers.
As of Q4, we had 2.2 million podcasts on the platform (up from more than 1.9 million podcasts in Q3). Of note, 25% of our Total MAUs engaged with podcast content in Q4 (up from 22% of MAUs in Q3 2020). We continue to see strong growth in podcast consumption, with consumption hours in Q4 nearly doubling since Q4 2019.Spotify’s Q4 2020 earnings call
Thanks to the increased engagement from content investments and better ad tools, Spotify are making more money per user than a year ago. In a press release Spotify commented on the correlation of Spotify Podcasts and increased monthly users, “based on the behavior we see when users first join Spotify, we are confident that podcast usage has been a factor in the accelerated [monthly active user] net additions.”
The growth of Spotify’s podcast platform was helped by their huge investments into acquiring networks and exclusive shows from the likes of Michelle Obama, Kim Kardashian and Joe Rogan, in 2020 alone.
“As we look at that universe though, the primary thing that we’ve been focusing on as we got into this audio first strategy was we already had a massive user base on Spotify today. How can you turn them into podcast listeners? And extending our platform into becoming the de facto podcast player.”
“Obviously we do believe that Joe Rogan has contributed positively to user growth on the platform. We haven’t broken out how much of his usage has come from existing users or new users. But if you take a giant step back, part of the strategy when you bring someone like that on the platform is, it’s going to have a couple of different effects. One is to bring new people onto the platform, and another is to create a better experience for those already on the platform, whereby their retention increases or their churn (cancelled subscriptions) goes down.”
“The revenue against podcasting is growing very, very nicely as well, so we are seeing that. We’re not quite at the point yet where the revenue is outpacing the continued investment. We are very optimistic that over time we will get there. But as Daniel mentioned, we’re going to continue to invest and that investing has a compounding effect and a compounding benefit on the business.”Paul Vogel, CFO, Spotify – Earnings Conference Call Q4 2020
Spotify aren’t alone in investing in and ramping up podcast efforts, with Amazon Music for example acquiring Wondery for an estimated +$300 million, and Apple considering some sort of premium podcast subscription. Spotify CEO Daniel Ek commented on these reports, saying:
“I definitely do believe that, and we’re not surprised that something like audio that interests billions of consumers around the world also will catch the attention of the big companies, because there are very few spaces that have hours of most consumers’ time of day, and reach billions of people at the same time. So, we’re not surprised that this is happening.”
“I believe about three years ago, there were fewer than 30 people at Spotify that were actively producing content that ended up on our service in one way or the other. And that number now is, I would say certainly during ’21 will be closer to 1,000 people.”Daniel Ek, Co-founder and CEO, Spotify – Earnings Conference Call Q4 2020
Spotify say they are still in the early days of investing in podcast content, with more exclusive podcasts planned for 2021. Going forward, Spotify say they will put a greater focus on building the studios they already have acquired, than investing in new ones.