Spotify to Buy Advertisement Firm Megaphone in $235-Million Deal to Monetise Podcasts

Sweden-based Spotify has agreed to purchase podcast promoting and publishing platform Megaphone, it mentioned on Tuesday, the newest in a sequence of a offers to increase its podcast platform.

The deal is value $235 million (roughly Rs. 1,700 crores), a Spotify spokesman mentioned.

The firm will use Megaphone’s expertise to create focused commercials, it mentioned, and also will make its proprietary commercial monitoring instruments accessible to third-party podcast publishers.

Spotify, which earns income from paid subscriptions and by disseminating commercials to non-paying customers, noticed its promoting enterprise return to development in the third quarter after it was hit by the pandemic earlier this yr.

Executives have mentioned commercial development will speed up in the present quarter.

Its heavy investments in podcasts, in an effort to develop into the Netflix of audio content material, have helped drive subscriber development at a time when many individuals are homebound due to the coronavirus outbreak.

Since final yr, Spotify has spent a whole bunch of tens of millions of {dollars} to purchase corporations like Gimlet Media, a podcast producer, and Ringer, the sports activities and leisure podcast community based by sports activities author Bill Simmons.

The firm mentioned the brand new expertise will assist podcast publishers earn extra from their work.

“We are still in the early chapters of the streaming audio industry story, but it is absolutely clear that the potential is significant,” Spotify’s Chief Content & Advertising Business Officer Dawn Ostroff mentioned.

Spotify now has 1.9 million podcasts, up from 1.5 million in the second quarter, boosted by large launches equivalent to The Michelle Obama Podcast and Mama Knows Best by influencer Addison Rae.

© Thomson Reuters 2020

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