Spotify to Acquire Podcast Production Companies, Gimlet Media and Anchor
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Spotify to Acquire Podcast Production Companies, Gimlet Media and Anchor

Spotify & Gimlet Media

Last week, Spotify announced the strategic acquisitions of Gimlet Media and Anchor, two of the podcast industry’s largest production houses and distribution tools, respectively.

Gimlet is home to popular shows such as Reply All, StartUp and Spotify exclusives Crimetown and Mogul, previously called itself the “HBO of audio,” and will be sold to Spotify for a reported price of around $230 million. Anchor, on the other hand, claims that it powers 40% of new podcasts entering the market and accounted for 15 billion hours of audio content on Spotify in Q4 of 2018.

This move is one that could potentially make Spotify the one-stop-shop for all audio content, be it music or podcasts. According to a Recode interview with Gimlet’s founders, Spotify accounts for nearly 20% all podcast listening, a significant jump from the 7% share reported just half a year ago. The company’s Q4 shareholder letter reveals that over 10,000 podcasters are currently using the Spotify for the Podcasters analytics tool, which is still in beta. Now that Spotify owns Anchor, it can finally bring its vision of becoming a “two-sided marketplace” to life.

Spotify has tried growing its own podcast content but hasn’t gotten very far. The acquisition of Gimlet would put Spotify on a path to offering a critical mass of original audio content that would distinguish it from the very large pack of podcast apps, which all offer most or all the popular podcasts for free. It would also give Spotify the ability to create high-profile commercial video content.

Brands typically pay higher CPMs for podcast placements compared to other digital ad formats, as MIDiA Research analyst Georgia Meyer notes, “podcast sponsorship is the new Instagram influencer marketing,” as it caters to a

niche, highly-engaged audiences. Thus, Spotify will be a direct beneficiary of these sponsorship dollars, particularly in the case of Gimlet’s high-production slate of shows.

These acquisitions have now sparked panic among music distributors, as they are now racing to brand themselves beyond just delivery and accounting tools.

Megha Shah
Megha Shah
A dreamer, traveler, aspiring entrepreneur and a bookworm beyond repair, Megha Shah is extremely fond of writing and has been doing so since she was a child. Apart from being a part-time writer, Megha is currently in college, pursuing B. Com. (Hons). Megha is an ardent follower of ‘Hardship, Hustle and Heart’ and firmly believes in the power of hard work and destiny!
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