Brief - The Hustle

Podcast wars: Apple vs. Spotify

Written by Trung T. Phan | Apr 26, 2021 8:02:05 AM

There can only be one… or two… maybe more (SOPA Images / Getty Images)

The word “podcast” is a portmanteau of “iPod” and “broadcast.”

As you can imagine from the first of those words, the inventor of the format is a tiny little company called Apple.

But since introducing podcasts in 2005, the iPhone maker has won purely by being the default and introduced very little innovation…

… until last week

As part of a larger event called “Spring Loaded” — where it showcases new hardware (e.g., iPads, iMacs, AirTag) — Apple announced that it’s offering paid podcast subscriptions, per The Wall Street Journal:

  • Creators pay Apple $19.99 a year to activate the option
  • Apple takes 30% of subscription revenue in year 1 and 15% thereafter

While the 30% cut may irk some — and is already a source of antitrust concern for Apple — the potential normalization of paid podcasts could be a gamechanger, especially from a company with 1B+ iPhone users.

Now, Spotify will roll out its own subscription option

The streaming service will not charge creators for the right to do so… nor will it take an ongoing cut, per the WSJ.

This is the latest Spotify move to own the podcasting space which, to date, is making serious headway.

Analytics firm eMarketer says the Swedish company is on pace to overtake Apple for podcast listenership in the US (Apple’s market share has declined from 34% in 2018 to 24% now).

With podcast ad revenue projected to break $1B in the US this year for the first time ever, and Spotify taking Apple to court over its App Store policies, the battle is just starting.