Spotify is looking to change the face of the podcast industry. In a massive push towards catering to podcast listeners, the music streaming service confirmed yesterday that it has bought two podcast networks, Gimlet and Anchor.
The final value for the deal hasn’t been disclosed but the company says it will spend a further $500 million “on multiple acquisitions in 2019.” According to technology news website Recode, Gimlet is valued around $200 million but it is unclear the exact amount Spotify paid for Gimlet and Anchor.
For anyone who has been reading the news from Spotify these last few months, this deal shouldn’t come as a surprise. The company made its intentions to get into podcasts clear last year. The company has been creating exclusive shows, such as “Unbothered” from journalist Jemele Hill, while also working on special ad units around its podcast network.
Spotify wants to make podcasts a mainstream addition to its menu and not just a side dish. Courtney Holt, the head of Spotify Studios, told TechCrunch in January, “People who consume podcasts on Spotify are consuming more of Spotify — including music. So we found that in increasing our [podcast] catalog and spending more time to make the user experience better, it wasn’t taking away from music, it was enhancing the overall time spent on the platform.”
Spotify will give listeners a broad podcast catalog too chose from in addition to the over 40 million tracks it already contains.
Spotify is not just focused on users; it also wants to ensure that the ads that run on these podcasts are aligned with users’ preference. Both Anchor and Gimlet can help them do just that.
Gimlet Media Inc. is a podcast network and digital media company founded by Alex Blumberg and Matthew Lieber in 2014, while Anchor is a podcast production app that allows users to create and distribute podcasts.
Some of Gimlet’s podcasts include the shows “Reply All,” “Crimetown,” “StartUp,” and the New York magazine collaboration “The Cut on Tuesdays.” Anchor, according to the press release, will help “bring its platform of tools for podcast creators and its established and rapidly growing creator base” to Spotify, which first brought on podcasts to its platform in 2015.
Spotify laid down its podcast plans on February 6th in a blog post titled “Audio First.” Spotify CEO Daniel Elk wrote, “We believe it is a safe assumption that, over time, more than 20% of all Spotify listening will be non-music content,” and said he believes the acquisitions “will meaningfully accelerate [Spotify’s] path to becoming the world’s leading audio platform.”