What Apple’s and Spotify’s New Podcast Subscription Plans Mean for Creators and Listeners
If you’re somebody who creates or listens to podcasts, then you may have noticed a handful of big announcements about podcast subscription plans recently. These subscription plans are definitely worth paying attention to, because they’ve introduced a whole new funding model into the industry and could have a lasting impact on the entire podcasting ecosystem going forward.
Let’s dive in.
Subscribing to Your Favorite Podcasts
In April of 2021, both Spotify and Apple made it known that they were going to begin allowing creators to publish premium content that would be exclusively available to paid subscribers.
The aim of these new podcast subscription plans isn’t to lock shows that were once free behind a paywall, but rather to give podcasts a new revenue stream outside of traditional podcast advertising. This means that podcasters can offer their ardent listenership a new way to directly support them and access additional content.
Many see this as an exciting development in the world of podcasting because it means that independent creators will be able to enhance the quality of their shows and produce more content for their audiences. Up until now, most independent content creators turned to membership platforms such as Patreon to distribute paywalled content to their subscribers.
But with the arrival of Apple’s and Spotify’s podcast subscription plans, the ability to subscribe to a particular show is now streamlined through the major platforms where the majority of listeners are already tuning in to stream their favorite shows: Apple Podcasts and Spotify.
However, these two services’ podcast subscription plans look a bit different from one another. Let’s break down the similarities and differences between Apple’s and Spotify’s new offerings.
Apple Podcasts Subscriptions
Apple’s new subscription offering, entitled Apple Podcasts Subscriptions, will enable podcasters to provide exclusive content to paid subscribers. Apple is charging its creators $19.99 per year to participate in the program, which will in turn allow creators to set their own monthly subscription rates. Apple will, however, take a 30% cut of creators’ earnings during the first year they take part in the plan, which will drop down to 15% for the subsequent years.
Although there are a handful of competing services in the listening landscape, Apple has the benefit of being a leader in podcasting dating back to, well, when the medium was first invented. (The term ‘podcast’ is, after all, a portmanteau of ‘iPod’ and ‘broadcast.’) Because so many podcast listeners already use the Podcasts app to listen to their audio content, it’s probable that subscribing to individual shows within Apple’s closed system, where a user’s Apple ID and payment info is already saved, will be that much more seamless.
Apple Podcasts Subscriptions will begin to roll out in over 170 countries and regions starting in May 2021.
Spotify’s paid subscription platform
While Apple has said that it will keep about one-third of the profits that creators earn through its subscription plan, Spotify is taking an alternate (and potentially more creator-friendly) route. The Swedish streaming service will allow podcasters to keep 100% of subscription revenue until 2023, at which point a 5% fee will kick in. This makes Spotify’s offering an attractive option for independent creators because it grants them a couple of years to establish an audience before Spotify starts charging them (at a rate which is significantly reduced from Apple’s 15-30% cut).
The opportunity for listeners to become paid subscribers directly within the Spotify app, however, may not be as frictionless as Apple’s offering. The Wall Street Journal reports that “users of Spotify’s iOS app who subscribe will be routed to a website for the transaction, meaning that Apple won’t take a cut of the revenue.”
Spotify, which is framing its subscription plan as a way for creators to provide fans with “subscriber-only bonus content,” will allow users to search for and discover subscriber-only shows and episodes in the same vein that they can any other content using the service. Notably, the play button on subscriber-only content will be replaced with a lock symbol, prompting users to subscribe in order to be able to listen.
NPR’s adoption of podcast subscription plans
One major media organization that appears to be an early adopter of Apple’s and Spotify’s podcast subscription efforts is National Public Radio. At the same time that Apple and Spotify made their big announcements, NPR revealed that it would begin giving its listeners the opportunity to become paid subscribers to their prominent library of shows, which includes the likes of Planet Money and Code Switch.
When a listener becomes a paid subscriber to an NPR show, they will then be able to listen to that show without any sponsored messages. These ad-free versions of the shows simply add ‘Plus’ to their tail end—dubbing themselves Planet Money Plus and Code Switch Plus. There’s also an additional subscription plan which, as Hot Pod reports, “revolves around access to a broader sponsorship-free NPR Podcast bundle that comes attached to a station membership at a certain level.”
In an email to the NPR Board, the broadcaster explained that “very few of NPR’s 24 million monthly podcast listeners are supporting public radio today. Paying for a subscription will be an easy way for them to do so, in the apps in which they are already listening. Together, Apple and Spotify represent more than half of NPR listening.”
NPR’s new podcast subscription plans will be accessible through both Apple Podcasts and Spotify. And while subscribing to the Plus version of a show will provide audiences with a better listening experience, the free, sponsored versions of each NPR show will continue to be available to listen to on all audio streaming services.
What Does This Mean for Podcast Listeners and Creators?
These changes to the way that podcasts can be listened to and funded represent an evolution in the podcasting industry.
For some, it will turn podcast creation into a more viable side hustle or full-blown career path, with more independent creators profiting off of all of the hard work they put into their shows.
Podcast listeners may also be pleased with the opportunity to opt-in to get bonus content for the shows they most vehemently follow, while continuing to listen to the free offerings for the shows that they aren’t as devoted to.
However, listeners won’t need to become monthly subscribers in order to keep tuning in to particular podcasts. For the time being, podcasts will remain free to stream on Apple Podcasts and Spotify, while the premium content of these shows (bonus segments, ad-free episodes, etc.) will rest behind a paywall. It’s yet to be seen whether entire shows will become gated for paying subscribers in the future, or whether audio streaming services will begin offering bundle subscription plans for users to access a particular range of podcast content for a single fee.
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