Spotify Loses Another High-Profile Host & Announces Layoffs: What's Going On There?

 When do you know when a trend is a trend? When similar events happen in a short period of time? That seems too broad and vague as a description. Maybe when a series of related events are orchestrated by an entity. In this case, Spotify.

I think the question is: Is Spotify intentionally driving away its high-profile hosts and creators? Why would they do that? Save money? 

That's a reasonable assumption since Ashley Carman reported on June 5 that Spotify is laying off 200 employees, primarily in its podcast division. 

This sudden layoff announcement comes on the heels of reports that Jemele Hill is looking for a new home for her podcast, Jemele Hill Is Unbothered. Hill's Spotify contract ends in the summer. Rumors are flying that Hill may want to exit earlier than the contract end date.

In leaving Spotify, Hill waves goodbye along with other high-profile podcasters who have not renewed their contracts with the audio giant, including Brené Brown, Esther Perel and the Obamas’ Higher Ground. There's even scuttlebutt that Joe Rogan will bolt Spotify when his contract ends at the end of 2023. Rogan, who has chafed under Spotify's weak-kneed, loophole-driven content moderation, has threatened to leave, usually after Spotify has pulled some of his episodes for misinformation mischief.

Spotify does have a $60 million existing deal with Call Her Daddy and host/creator Alex Cooper. Call Her Daddy, with its sonic sexuality, is one of the most popular podcasts according to Podtrac in the industry. Would Spotify allow to Cooper to shop around when her deal expires?

Hill has been an early fixture in Spotify’s podcasting strategy, having hosted Jemele Hill is Unbothered exclusively on Spotify since 2019. The former ESPN sportscaster and journalist is still contracted to release more episodes with Spotify as she completes the fourth season of Unbothered, but both Spotify and Hill are not planning on extending the host’s current deal for her podcast.

The deal discussions come as Hill’s other deal with Spotify for The Unbothered Network, a podcast network focused on elevating Black women, ended earlier this year. According to The Hollywood Reporter, "Hill and Spotify had initially struck a two-year deal to develop the network with two additional years that Spotify could option, but the two parties both walked away in March after failing to reach an agreement on terms."

In addition, acquisitions like the purchase of Gimlet and Anchor for $340 million in early 2019 have not appeared to be the slam dunk Spotify hoped these purchases would be. 

So what's the play for Spotify going forward in this year and then in 2024?

A leaner, more focused podcast network with fewer high-profile (and expensive) hosts / creators? Maybe a pivot to more true-crime and comedy podcasts, where ad rates are higher, and audiences are thirsty for more content in those arenas? More partnerships with smaller production studios to offload costs and share expenses?

Spotify has seen a lukewarm response to its foray into audiobooks with a clunky interface, clashing marketing strategies, and lackluster pricing strategy, with Spotify's prices often falling in the middle between subscription-oriented platforms and other à la carte audiobook sellers, attracting little notice.

One source is good news is that Spotify tops all podcast feeds for total listeners to podcasts. Yet, Apple still dominates in podcast downloads, according to new U.S. data from Podtrac.

Podtrac also revealed that Spotify has the lowest number of episode requests per listener, at just three: Apple Podcasts users download more than nine times as many.

According to Edison Research, Spotify, SiriusXM Podcast Network, and iHeartRadio take the top three spots as the networks with the greatest reach. 

How will these recent moves -- layoffs, the upcoming loss of Jemele Hill, and earlier defections from other big-name podcasts impact Spotify's place in podcasting?

Is being number one in reach that critical?

Whatever the barometer for success for podcast networks, it's clear that Spotify dove into the deep end of the podcasting pool in 2019, and now understands it should have doggie-paddled into the shallow end before getting in over its head.  

Is Spotify drowning? Or just treading water? 

Stay tuned.