Spotify buys Gimlet and Anchor to combat iTunes' podcast dominance
Music streaming giant Spotify is making a push into offering podcasts to its users by buying two companies in the field, an attempt to catch up and compete with the dominant Apple iTunes for podcast distribution and listening.

Spotify founder and CEO Daniel Ek
Advised in a blog post by Spotify founder and CEO Daniel Ek, the streaming service anticipates its next phase of growth in audio will be in podcasting. In just under two years, Ek claims Spotify has become the second-largest podcasting platform, but it wants to take first place.
To do so, Spotify is buying two companies that have made an impact in the podcasting industry. The first, Gimlet, is a major content creator seeing success with its podcasts, such as "Homecoming" adapted from podcast to video for Amazon Prime, along with the internet culture-based "Reply All."
The other company, Anchor, produces podcast creation and distribution tools, including apps for the iPhone and iPad. According to Ek, Anchor has helped in the production of 15 billion hours of content listening on Spotify during the fourth quarter.
Though terms of each acquisition were not revealed, Ek believes, "These companies are best-in-class and together we will offer differentiated and original content. Gimlet and Anchor will position us to become the leading platform for podcast creators around the world and the leading producer of podcasts."
Citing radio industry data, Spotify believes it is a "safe assumption" that 20 percent of all listening on the service will be non-music, and has the potential to grow at a faster rate with more original programming.
"Just as we've done with music, our work in podcasting will focus intensively on the curation and customization that users have come to expect from Spotify," states Ek. "We will offer better discovery, data, and monetization to creators."
The announcement arrives at the same time as Spotify revealed its fourth-quarter earnings for 2018. During the period, it saw revenue of 1.49 billion euro ($ billion), with a gross margin of 26.7 percent. The total user count is claimed to be 207 million across all tiers of service, 96 million being paid subscribers, with each increasing year-on-year by 29 percent and 36 percent respectively.
The 96 million paid subscribers puts Spotify at almost double the user count of Apple Music, which was revealed during Apple's quarterly conference call to have 50 million subscribers.

Spotify founder and CEO Daniel Ek
Advised in a blog post by Spotify founder and CEO Daniel Ek, the streaming service anticipates its next phase of growth in audio will be in podcasting. In just under two years, Ek claims Spotify has become the second-largest podcasting platform, but it wants to take first place.
To do so, Spotify is buying two companies that have made an impact in the podcasting industry. The first, Gimlet, is a major content creator seeing success with its podcasts, such as "Homecoming" adapted from podcast to video for Amazon Prime, along with the internet culture-based "Reply All."
The other company, Anchor, produces podcast creation and distribution tools, including apps for the iPhone and iPad. According to Ek, Anchor has helped in the production of 15 billion hours of content listening on Spotify during the fourth quarter.
Though terms of each acquisition were not revealed, Ek believes, "These companies are best-in-class and together we will offer differentiated and original content. Gimlet and Anchor will position us to become the leading platform for podcast creators around the world and the leading producer of podcasts."
Citing radio industry data, Spotify believes it is a "safe assumption" that 20 percent of all listening on the service will be non-music, and has the potential to grow at a faster rate with more original programming.
"Just as we've done with music, our work in podcasting will focus intensively on the curation and customization that users have come to expect from Spotify," states Ek. "We will offer better discovery, data, and monetization to creators."
The announcement arrives at the same time as Spotify revealed its fourth-quarter earnings for 2018. During the period, it saw revenue of 1.49 billion euro ($ billion), with a gross margin of 26.7 percent. The total user count is claimed to be 207 million across all tiers of service, 96 million being paid subscribers, with each increasing year-on-year by 29 percent and 36 percent respectively.
The 96 million paid subscribers puts Spotify at almost double the user count of Apple Music, which was revealed during Apple's quarterly conference call to have 50 million subscribers.
Comments
The native app is better than it used to be. Can't wait for dark mode.
Apple invented the Podcast.
It's a shame they're allowing others to eat their lunch.
Just goes to show, most people are sheep, i listen to music today and do not pay over and over again, i listen to the radio with some ads which i tune out, or i listen to my private collection which I paid once and can listen to it as many times as I want. But people got suckered into paying to listen and keep shelling out money each month. In this generation subscription models, people will be shelling out $1000's of each year and have nothing to show for it.
Spotify almost surely wishes to monetize podcasts, which means a rather different approach that that taken by Apple. I'd wager that approach will be far more advertising-intensive and involve a lot more user tracking.
They didn't invent it, they stumbled into it. Users created the idea.
As mentioned in an earlier post, Apple does not monetize podcasts. They only act as a directory of RSS feeds, they don't host any audio files nor do they derive revenue from advertising.
There isn't a lunch to eat.
I am one of those sheeple you speak of and I, for one, see value in the subscription model. I used to buy tons of CD’s and DVD’s in my younger years thinking the same thing you are. If I own it, I will be able to consume it whenever I want and as often as I want. But unfortunately the perks of growing up and making more money also has it’s drawbacks; I no longer have spare time to watch the same movie 3 times or more as that is no longer a reality for me (and many others I would assume) Not only that but I can no longer watch some of my all time favourites because I only owned it on VHS and never repurchased them on DVD or Blu-Ray. I have even bought movies after watching them thinking I’ll be watching them again at some point only to discover years later that they are still unopened. I see this all the time at friends houses, purchased media never being opened. The amount of money I was spending on CD’s back in the day was also more than my monthly family payment for Apple Music of 15 dollars a month. That 15 bucks a month gives me any song I could want to listen to, the ability to find and be exposed to new artists and music easily, and to never have to worry that I will need to maintain an aging device to keep playing that media. This is some of my rationale for why I prefer the subscription model over the purchasing. And while it is different than yours, I do take offence at being labelled as someone who bought into model that only a follower and non-thinker would buy into.
People need to recognize there is only so much time in a day. If they are subscribing to enough media where they are paying 1000’s (2000+ is how I read that) of dollars a year for it, then they really need to sit down and think about what it they are actually purchasing, because at 2000+ a year, I have got to assume those people are paying for the convenience and privilege to consume everything they want when they want; which is a completely different issue. So if that’s your argument for who qualifies as sheeple then I would agree, those people have lost the plot. I, however, recognize that I only have so much time available for consuming media and as such only subscribe to 2 video companies at a time, Apple Music, 3 podcasts, and 3 media sites. My totally monthly bill for those equals less than what I would be paying for full cable television. I also benefit from never having to be subjected to advertisements and knowing that a portion of that money is going to those who contributed to creating the content. But yeah, if you are someone who watches every sport and 15 movies a month and tons of other shorter shows, etc, then you probably should be paying more because you are consuming more.
K
But I am concerned that so many business models are predicated on the recurring subscription model only because it seems that ownership is being phased out and all the masses will have left is a stack of recurring bills and “nothing to show for it”. I certainly don’t want to feed that future.
NB - obviously there are loads of good examples of where renting instead of owning makes sense. Just saying the sentiment these days seems to me to push more people into paying over and over again.
You listen to the radio with 'some' ads? Bro, you listen to the radio with ALL its ads.
So convenient to have a romantic evening with chill out music... and then some burrito advertisments.
I pay because I get great sound quality and save time:
- I have higher quality sound (yeah, I had a huge lossless collection, so don't start on that).
- I have my playlists synced across the devices and music being available offline on my mobile
- The shared playlists are awesome. Before I had to manage my collection (starting from laborious tag management)
And when the dust has cleared, there will be just 2 players. Like Hertz and Avis.
Makes sense to me.
I understand from a business perspective why Spotify would't want to carry music podcasts, but this is shortsighted, as I use these shows to discover new music which I eventually add to my Spotify playlists.
Spotify will never embrace the free market of podcasts and artificially restrict them to information / talk only. So sorry Spotify, nice try but you'll never get me and millions of other Podcast listeners.