A quick one today, on Juneteenth.
Earlier this week, a survey on people’s willingness to pay for podcasts was published, and some of the headlines reporting the results could fairly be represented as “pessimistic.” After reading this one, which declared “Pay for Podcasts? No Thanks, Say Most Listeners,” I tried to fix the headline on Twitter:
We often get fooled by small numbers. I can’t tell you how many times people have reached out to me about data that shows “only” 5% of Americans do this, or “just” 7% of women agree with that. I never, ever, ever use the words “only” or “just” when I characterize data, because a) it’s a value judgment, b) “only”…compared to what? and c) any single-digit percentage of the US population is millions or even tens of millions of humans, and if they all sent you a dollar you’d be pleased as punch.
In the case of this study, it was commissioned by Variety, who reported it with the headline “Consumers Aren’t Ready To Pay For Podcasts, But Platforms Keep Trying.” Here’s the thing: the study, conducted by YouGov for Variety, reports that nearly 20% of U.S. podcast listeners say they would be Very or Somewhat Likely to pay for or donate money to a podcast. It’s a good study—those numbers smell right to me! But I read the data a little differently. First of all, I can assure you that any medium that could attract 20% of Americans to pay for it is a pretty great business. Second, any medium that could attract event the 2% of Americans who said they would be “very likely” to pay for content is a pretty good business. Third, people never want something until they do. For the millions of us who already subscribed to Netflix and Amazon Prime and Hulu (yes, all three), there was likely no way you would have said a year ago that you’d consider adding a fourth service to your increasingly costly subscription list. And then…BOOM. Disney+ appears and it’s essentially a national tax on parents.
I want to focus on another stat from that article that tells a better story, I think: Variety/YouGov also reported that 17% of U.S. podcast listeners have ever paid or donated to access a podcast. Now that, in research terms, is a crapton of people. In Edison Research’s Podcast Consumer Tracker, we ask a similar question, but to weekly podcast listeners, who are presumably somewhat more passionate about the medium than U.S. podcast listeners overall) and we ask about donation/payment to a podcast in the last 12 months, not “ever.” Guess what our number is? Yep—17%.
So I don’t need to speculate about whether one in five podcast listeners might pay for a podcast; nearly one in five already have. It’s behavior already in evidence. It just isn’t concentrated on a single “Netflix of Podcasting” and maybe it never will be. That’s why I will never view the reported struggles of Luminary, a high-profile attempt to create a premium podcast network, as a referendum on the viability of a subscription model. A subscription model is 100% feasible, possible, and I can guarantee it will happen. Howard Stern alone drove millions of people to pay more than ten bucks a month just to listen to him in their car. Joe Rogan likely could do the same. It only takes one show, or one personality, and the calculus changes.
Ten years ago, Edison Research and the (now defunct) Association for Downloadable Media fielded a study on consumer attitudes on advertising and monetization of podcasts—and this was well before most of today’s leading podcasts were even in existence, save This American Life and a handful of others. Even then, when we asked respondents how many would be likely to pay a small subscription fee to listen to the podcasts they listen to regularly, ten percent agreed that they would. Not “only ten percent,” but ten percent in a time before most of the broad concept, mass-appeal podcasts of today were started, when all podcasts were free, and Spotify was not even available in the United States (GASP—WHO CAN IMAGINE SUCH A TIME).
So, I’ll wrap it up this week with something I often tell reporters who call me up and ask me to comment on Luminary (I never do) or the folly of chasing a subscription model: I am a firm believer that any and every revenue model is applicable to podcasting, that saying any one of them is preferred to another is a false choice, and that all of them are essential to keeping podcasting a robust, going concern. And let us never forget how quickly things can change with consumer behavior. In five years we have gone from “don’t ride with strangers” to “use this app to ride with strangers” to “don’t ride or drive anywhere STAY HOME.” Good luck with your five-year plans!