The Podcast industry is growing rapidly with over 1 million podcast shows on offer. In 2018 the industry generated almost $500 million (a 50% increase from 2017) in revenue. By 2021 the industry is predicted to generate over $1 Billion in revenue, however it has a major problem, most creators are not getting paid. While the predicted revenue sounds big, when we consider the recent $100 million deal which Joe Rogan made with Spotify you might realise that most of the money is going to a small number of the podcasts. Now a new app called Podhero hopes to change that and create a system which will help podcast hosts to keep going.
Recent data suggests that 97.2% of podcasts (972,000 shows) make no money, not to mention profit after spending on maintaining websites, producing the audio, buying gear and paying for hosting. So who is making money and how?, Well based on estimates of current data, it is said that 1.4% of podcasts (14,000 shows) have managed to secure ads or sponsors. Meanwhile, only around 1.4% of podcasts (13,800 shows) are actually able to monetize through premium content or subscriptions on services like Patreon.
One of the big problems is that in the advertisers eyes 99% podcasts are not big enough to justify paying for ads. Deciding on shows to advertise with, measuring the effectiveness of the ads and managing the placement and creation of ads is time consuming and difficult. Moreover for hosts, some of the advertisers won’t be a good fit and for listeners ads are an annoying turn off. While you might hear more than 1.4% of podcasts with ads, some of these are actually affiliates whereby the host only makes a profit if a user signs up or buys a service using their special code.
Podhero hopes that it’s soloution will be appealing to both Podcast hosts and listeners. The current systems in place to support a podcast through a subscription like Patreon are too difficult to manage and maintain, hosts have to offer tiers – either by restricting content or creating additional content that you don’t let everyone hear. In the case of Patreon it also takes an 8% cut for doing absolutely nothing but providing the platform. I can understand Spotify taking a cut of subscriptions for it’s music services because they actively improve the UX of the app people are listening to, managing servers for the music and help artists to reach more listeners and understand who their listeners are.
Having previously rolled out Swoot, a social podcast listening app the creators of Podhero hopes to tackle the podcast revenue problem. PodHero is a player available on iPhone & Android which charges users $5.99 a month, the company doesn’t take any fee’s only requesting a non compulsary additional amount (up to your discretion) to help them run. Each month your subscription fee is divided between the shows you’ve choosen to support. However, unlike 3rd Party subscription site Patreon, Podhero isn’t just a new way to support podcasts, it’s also a way to listen and discover new shows. As well as looking through categories and it’s charts, you can connect your account to social feeds like Facebook, Twitter and from your phone contacts to see what others are listening to.
PodHero doesn’t require Podcasters to sign up, they use existing feeds and databases to make sure all the podcast people might want are able to be found on the platform – except shows that are exclusively available on platforms such as Luminary. Once listeners start to support a show they’ll get in contact to tell them how to sign up and get access to their back end and receive funds. As another benefit to Podcasters, the platform will give them a new way to be discovered as users can recommend their favourite episodes to their followers within the app, and if your show gets recommended you’ll get a pay-out boost – although that’s not defined.