Why podcast apps are developing their own original content

Source: Aptus

Podcasting as a medium has been around for about 13 years now, and for much of that time you’d find that most podcasts were platform agnostic. When a new episode was released, it would appear pretty much simultaneously across all podcast apps. Sure, podcasters placed most of their promotional efforts on iTunes, but that’s because it accounted for most of all podcast listening.

But over the last few years, the podcast and audio app space has gotten more competitive, and because of this we’ve seen some of these apps marketing exclusive content. Spotify, for instance, has signed deals with podcast companies like Gimlet so that it gets an exclusive window on new episodes before they’re published to all the other podcast apps.

In some cases, podcast apps are actually bankrolling and producing their own podcasts in an effort to differentiate themselves from other apps. The hit show Missing Richard Simmons was produced by Stitcher Premium and exclusively windowed there (this apparently pissed off the executives at Apple, since they refused to feature the show on iTunes). Audible launched Audible Channels, a platform for its own podcasts that aren’t available on any other apps.

And now add Castbox to the list of podcast apps that are producing their own shows. An app with 15 million downloads, Castbox has recently launched “Off Track with Hinch and Rossi,” a show about auto racing, and it has several other podcasts in development.

I recently interviewed Peter Vincer, head of global strategic partnerships at Castbox, about why the company is producing its own shows and whether podcast apps are taking a page from Netflix’s strategy.

To listen to the interview, subscribe to The Business of Content on your favorite podcast player, or you can play the YouTube video below. If you scroll down you’ll also find a transcript of the interview.

iTunes/ Stitcher/ Google Play/ Overcast/ Spotify

Simon Owens: Hey Peter, thanks for joining us.

Peter Vincer: It’s a pleasure.

You’re the head of global partnerships for a company called Castbox. Can you start by talking about what Castbox is?

Castbox is a global, multi-platform podcast app, player, podcatcher, whatever you want to call it. We’re actually the largest multi-platform podcast player at the moment. Apple Podcasts dwarfs us by a lot. We’ve been around for a couple years. Founded in China by a couple ex-Googlers. And we finally launched an iOS app about six months ago, so we’re available on both. We’re active on all home devices, Android Auto and CarPlay. We’re mostly focused on building a global podcast network and developing some great digital content.

When you say you’re the largest multi-platform podcast player, what do you mean by that?

I guess it’s a fancy way of being able to say largest, since Apple Podcasts are so much bigger than us. We’re the biggest on Android by a lot, and since we’re on iOS and Android, we can cleverly say largest all-platform because that gets Apple out of the way.

So you guys are bigger than Stitcher, which is usually the one that’s always namechecked in addition to Apple.

Correct. Unfortunately, and this is a bit confusing, we happen to have two apps on Android. If you were to search ‘podcasts’ in the Google Play Store, the first that would show up is our purple app. It’s called Podcast Player by Castbox. That was the first app we launched just over two years ago. And about a year after that launched, there were a lot of engineering challenges caused by the foundation that we had started with. So strategically we decided to start fresh. We still have the purple app that has about 8 million downloads at the moment. And that still lives and it’s slightly different UI, but not much. And then we launched, about a year ago, the orange app, which most people are familiar with. We have about 7 million downloads at the moment, and that is the app that’s received Google’s app of excellence award. They’re both editor’s choice apps, which I don’t believe any other podcast specific apps are. Now we’re focusing on building out iOS app’s capability.

The podcast app is a very crowded space, with obviously iTunes dominating the field. Last statistic I looked up it had somewhere north of 50 percent of all podcast use. You have everything from Stitcher to Overcase to Player.FM, it goes on and on. Given that it’s such a crowded space, how do you differentiate yourself in the field?

The ‘crowded’ word you use, I think, is fitting for this answer, because a lot of the people would say that the apps they use to, whether it’s Apple or any of the others, tend to feel crowded and cluttered and not the simplest, easiest to use, or focused. That’s kind of the focus we’ve tried to have, is real tech forward and simple and sleek and easy to use. We also try to focus on discovery. We actually launched a feature last August called in-audio search where it allows you to actually search the text of most major podcasts. So you can type in ‘Donald Trump’ into our search bar, and it brings up either channels that are named something that involved Donald Trump, episodes, or in-audio text. So that’s a pretty unique feature that helps with discoverability. We’re working on even more capability. There.

So it’s largely a UX case, in the hopes that consumer is trying out a few of these apps will see that one is a little bit easier to use or caters to their needs than all the others?

Up to this point that has been our strategy. What I’m working on is developing a number of creative and unique original content podcasts as Castbox originals. That’s meant to build the brand and help differentiate ourselves from a lot of the others. Obviously Stitcher does the same, but that’s really the only main one in this space that has an original content focus, and even there it’s a bit more segmented because Earwolf handles much of the original programing. There’s also Stitcher Originals, which is somewhat newer. But then that’s kind of separated, whereas Castbox is all under one roof.

Well I wouldn’t say Stitcher’s the only one. Stitcher’s doing it with Stitcher Premium. We have Spotify, which is doing windowing deals with Gimlet and some of the other major platforms where it shows up on Spotify two weeks in advance. You could argue that Audible Channels, which they don’t call themselves a podcast app, but they’re essentially a podcast app. They’re producing exclusive content on theirs to differentiate the Audible app more. So it seems like this is an emerging trend within podcast apps. It’s a crowded space, so it seems like they’re adopting a Netflix strategy with the thinking that there are a lot of aggregator apps out there, we need to start producing our own original content to create differentiation.

Netflix is an interesting comparison, and it’s probably the one I would use most, because the nature of the business is advertising focused, so most is available to everyone who wants to be a podcast player. But then, yes, the goal is to eventually to create enough good content — I don’t know what the ultimate strategy will be a few years on, but I know for now we’re not going to restrict any of our shows whatsoever. We’re not going to window any of our shows. We’re not going to hinder the potential growth of any of our podcasts, and that’s best for revenue, best for our creators, and that’s best for the brand.

Interesting that you’re not even planning on windowing the original podcasts. Would that hinder your differentiation then? Isn’t the whole point of doing the original podcasts because it’s supposed to be on your app only, and that’s the extra impetus that the listener has to download your app over the others?

Kind of. I just think that if we have a great app that delivers a great user experience, and if we have great shows, and if our brand is something that resonates with the users we’re trying to target, and if we say you can listen to this everywhere because we want to be cool, but we prefer that you give Castbox a shot, I think that might resonate with listeners enough to get them to try us out. Of course that will somewhat limit the amount of traffic we can drive to Castbox specifically, but on the flip side, there will be great benefit to the shows themselves, and they’ll be able to grow at a much more healthy and organic rate.

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Tell me about the original shows you’re creating. I came across an indycar podcast you’re doing. What is the actual process here in how you approach these partnerships?

There’s myriad ways we approach the partnerships. The first podcast we just launched called Off Track with Hinch and Rossi is two indycar drivers, and that was through my network of people I knew. It was one that made too much sense. They’re both naturals behind the mic and they’re both really good indycar drivers. It’s going to be a great season. That seemed like a no-brainer for us to kick off the network.

And then we have a bunch of other ones that are in the hopper. We have a big partnership with Studio 71. We haven’t done any PR for any of the other ones, that’s coming in the upcoming weeks. Studio 71 is a big influencer manager company. They manage a lot of YouTubers and social celebrities. We’re launching 10 podcasts with them over the next couple of months. All original content. Although we’ll also have any fitting audio content from their existing YouTube channels. There’s one differentiator, because that will probably just live on Castbox. We’ll decide on a case by case basis.

We have another big partnership we’re about to announce with Birdwell, which is the first social influencer music level. They’re based out of CAA in Los Angeles. They’ve got a partnership with Sony, and they work with some of the biggest influencers on the planet. So we’re launching an influencer-meets-music podcast that would have a new episode at least every other week. We’re doing a big push at music festivals over the next couple of months to get that one on the map. We even have a billboard outside of Coachella.

Probably one of my most exciting projects is called This Sounds Serious. It is a true crime mockumentary. It should be about 10 episodes. It’s made by the same guys who created Dexter Guff is Smarter Than You (and you can be too).

It’s like a mock motivational speaker, or something like that?

Exactly. I just absolutely loved it and struck up a friendship with the creators their. They’re actually most famous for a radio show they have in Canada with CBC, which is the NPR of Canada. They’ve had one of the longest running radio shows, which is Onion-style comedy news. It’s been a huge hit in Canada for a number of years. They’re starting the final season soon, and they’re going to be making a few podcasts with us. That’s a really exciting one as well.

How are these partnerships structured? Does Castbox own the IP, and then these hosts are paid contractors? Is it a revenue share type thing? Are you guys 100 percent producing these podcasts, or is it more of a loose partnership?

It’s all different. Off Track, we share the IP with the existing hosts. Studio 71, those are existing brands, and so it didn’t make a lot of sense to push for the IP on those. And they actually were willing to produce all those shows themselves. They produce a lot of video content in their studios, so this is their first foray into podcasting, but not their first production in general. So they’re handling that one. Heardwell, they’re handling that on their own, and they own the IP as well. This Sounds Serious, we own the majority of the IP there, and they’re producing that. So it’s all different.

There are a couple other podcasts I’m forgetting at the moment. We just have so many that are coming out in the next few months that we’ll own part of and are being produced by partners of ours.

Is it analogous, going back to the Netflix analogy, of ‘here’s the money, you guys are the creatives. You produce this and we’ll stay hands off?’ Or is this something where you’re very intimately involved from beginning to end?

Although all of our partners have been incredibly willing to share a lot of the creative decision making in each of these projects, we really have let them do their own thing. Most of our partners have been in the podcasting and creator business for much longer than we have, and they’ve gotten to where they are by doing what they do best. We have been hands off, though we could have a greater say if we wanted to.

You mentioned you’re not doing windowing. I’ve heard that windowing has backfired in some senses. I was wondering why this is the reason you’re not doing it. I seem to remember that Missing Richard Simmons, because it was windowed on Stitcher, iTunes, which had been gearing up to do a big promotion for it, reversed that decision and did no promotion for it. I know Apple Music has pretty much stopped windowing songs because Spotify will then ignore those songs in its playlists, which caused some of these big albums to tank in their streaming numbers. Is that a major threat for these podcast apps, that if they decide to window, then they’re going to be virtually ignored on all the other podcast apps?

We didn’t make our decision based on what else has been going on in the market, but it just seemed intuitive to me that if we want happy creators and we want happy partners, and we want the shows to do as financially well as possible, and we want the brand to be recognized as widely as possible, and is also best for the listeners, it made sense to us to not be restrictive at all. The examples you shared, it seems like common sense to me. If you have a good show and you’re happy with everything that surrounds it, you’d want it to be as widely heard and recognized as possible. Maybe, if one day, we see a value in being more restrictive, we certainly retain that right. It just doesn’t make a lot of sense to me.

What’s the monetization strategy for a podcast app, because so far I don’t really see any winning model. On iTunes I don’t see any direct monetization there. It’s basically just a lock-in for Apple devices to get you using their services more. Stitcher they’re trying Stitcher Premium, and I think they’re owned by some major media conglomerate. Overcast, they originally did subscriptions, now they’re doing in-app advertising. It seems like there’s no winning model yet. How have you approached it?

Of course we can have, in the back of our minds, a 12, 24, 36 month plan on how to monetize. I think this is a rapidly emerging market, and things are changing. I think there’s probably, eventually a trend toward premium content, in that it’s delivered in an ad-free version, in that it’s delivered as bonus features or extra episodes, or full length interviews. All that type of stuff that could be passed along for a recurring donation. Patreon is kind of ushering that in. So that’s one way.

We could also deliver ad-free versions of our podcasts or others in a bundle, sort of like a Spotify/Pandora type offering. And one of our apps at the moment is monetized via display ads, so that drives some money. There’s a lot of opportunities for us to ultimately create revenue, but I think it’s too early to try any of those. I think the goal at this point is just to make sure people know what Castbox is and recognize that we’re one of the good guys.

You mentioned Patreon. A lot of podcasters use it to generate subscription revenue. You pay $1 a month, $5 a month, whatever the price is. And for that price you support the podcaster and often get extra goodies, like extra exclusive podcasts. So you think there might be some way that, instead of going to outside services like Patreon, they could build it into the app itself so it’s just one click, your credit card is on file, and this is the podcast you want to support in some way?

I think that makes a lot of sense. We’re taking one thing at a time. I was the first U.S. employee for this company starting last June, so in a short amount of time we’ve taken some big strides. I think that makes a lot of sense as a potential next step. We’ll get this network stood up and start figuring out next phases. But yeah, I think that’s one of the top possibilities.

One thing I’ve noticed is nobody is bringing the YouTube model, where you supply the content and we’ll supply the programmatic ads via pre-roll. We’re starting to see programmatic ads making its way into podcasting. It seems like that could be a way that podcasts could monetize their apps, saying hey, instead of you guys handling your own advertising, we’ll just insert mid-roll, pre-roll ads that are programmatically set up, and we’ll take a cut of that. Do you think that’s possible, or is it too much of a challenge because the app space is too fragmented?

You know, it’s funny you bring that up, because the U.S. podcast market, being advertising based, limits the capability of that broad-scale model. Whereas in other places like China, there’s only a few podcast apps that exist. It’s not an advertising-based market, so over there people pay per podcast they want to listen to, and the ads can be delivered in a programmatic fashion. Here, everyone is really ingrained in the existing industry model of being driven by advertising. We would obviously have to have some significant partners that would buy into that model, and if we were to do that, that would fragment their ability to sell ads elsewhere, and we would have to have different versions. I think, conceptually, that makes a lot of sense, but I don’t know how realistic it is.

One thing we’ve seen over the last two years or so is the rise of connected devices, voice-activated devices. What’s the strategy there for a company like yours? Are these a threat to a company like yours, or are you trying to quickly adapt?

I love them, and they’ll only help our cause. As long as we’re delivering a great product for people to use, as long as our Alexa skills or our Google Home skills or Homepod skills, as long as we have all that dialed in, there will always be a space for the Castboxes and the Spotifies and the rest. I think, additionally, all of those emerging technologies only make the case for audio stronger. I envision a world five to 10 years from now where we’re not scrolling through a Facebook or an instafeed, but instead we’re waking up and saying Alexa go through my feed, and a lot of it is creators, influencers, sharing audio content so we can share so much more of it. I think it’s ushering in a new wave of technology that doesn’t exist today.

With Homepod at least, there have been things written about how it’s a threat to Spotify because the only real integration with Homepod is Apple Music. Is that a challenge, not just with Apple, but any of these connected devices, where partnerships are being formed and because they’re voice activated, they need to have default apps they use when they’re playing podcasts. I think with Alexa it’s Tunein. My question is: how do you navigate those waters without being left behind?

At the moment, I know on my Google Home device and my Alexa device, if I say play Michael Buble on Spotify, it’ll play on Spotify. If I say play Joe Rogan’s latest podcast episode on Spotify, even if Tunein is the default, it will still do that. I think people are pleased when they can use whatever app that they’re familiar with, wherever they have their playlists. I know if I had to change from Spotify today, I’m sure there would be capability to port all that stuff over. But I’m still familiar with Spotify for my podcast playing and that’s what I use. I think it’ll probably behoove a lot of these connected devices to have a more open system where people can use their favorite app within those and not be restricted. Obviously if they say that only a default app can play your podcasts, then we’ll have to be reactive and figure something else out. But at the moment, we’re heading toward a more open and connected tech community, but time will tell.

Most podcasts apps are focused on podcast consumption, but we’re seeing some entrants like Anchor that are trying to make recording podcasts easier, almost like trying to create a social media platform for audio. I’ve been skeptical that there’s a real demand for this? Do you think there’s a demand for podcast apps to make it really easy to do a podcast app without having to have a specific host and all the other hoops you have to jump over to produce a podcast?

We share the same sentiment with the Anchors of the world. I like Anchor a lot. I think the UI is slick, and it’s really fun to use and play around with. I don’t believe the demand is there yet. We have the capability in our app to record and distribute the feed elsewhere. Within Castbox we haven’t seen a lot of demand there. And more broadly, the podcasters of today are typically not someone in their garage talking about their favorite likes and dislikes, they’re production studios and big networks and entities that have been creating content in other formats.

I think eventually when we get to a place where people are sharing more audio socially, there will be a need. But I think we’re a couple years out from that from having enough demand for those capabilities.

So even though Castbox does have that functionality, you’re just not seeing that much user generated content through those features.

I forget the number of users that we even have that use it, but I think even the most popular user that’s distributing via Castbox, they have a couple thousand plays. When you think about it logically, there just aren’t that many people that have anything interesting to say and know how to grow it well enough in today’s ecosystem.

It’s ironic that in an era where we keep reading about how Millennials hate voicemail, there’s also these separate pieces that say we need an app that would boil down to people leaving voicemails that are mass-distributed via social media apps. I don’t see that being widely adopted at all.

Not now for certain. It is funny. Certainly video isn’t getting smaller, but we are trending back toward the radio/audio heyday of 10, 15 years, or way longer. It’s funny how cycles are with media and consumption.

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Simon Owens is a tech and media journalist living in Washington, DC. Follow him on Twitter, Facebook, or LinkedIn. Email him at simonowens@gmail.com. For a full bio, go here.

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