Another week, another round of cuts. This time it’s Spotify. CEO Daniel Ek told employees yesterday morning that the company would cut 6 percent of its workforce and said he “takes full responsibility for the actions that got us here today.” The most high-profile change is the departure of chief content and advertising officer Dawn Ostroff. While additional shows were not cut, advertising and business staff, particularly under Podsights and Chartable, were laid off about a year after Spotify acquired both companies.
Plus (and I realize how inappropriate this is, sorry), we have a few more announcements for the Hot Pod Summit.
After years of podcasting, Spotify is on the wane
Spotify has built itself into the biggest force in the podcast industry through sheer force of will (and capital), spending more than $1 billion on acquiring studios, publishers and ad tech. It also relies on veteran entertainment executive Dawn Ostroff to oversee blockbuster deals that have delivered hits over the past four years. The Joe Rogan Experience, Call her fatherand Batman is not buried only to the platform. Now, as part of company-wide layoffs, Spotify is turning to consolidation.
According to Ekin’s letter, Ostroff is not willing. Taking over its content and advertising vertical is its chief subscription officer, Alex Norstrom, who is now chief business officer. Heads of talk content Julie McNamara, Max Cutler and Bill Simmons will report to Norstrom.
“Working together, our podcasting team has revolutionized the space,” Ostroff said in a company filing yesterday. “The trajectory of this organization is amazing, going from virtually zero market share and a handful of podcasts to a leading platform with over five million podcasts today and a 30x increase in podcast consumption on the platform.”
But (and this is a big but), Norstrom is not a content man. Going from someone like Ostroff with Hollywood roots to a more typical tech executive like Nostrom will inevitably result in a change in how the business operates. Perhaps McNamara, Cutler and Simmons will have more autonomy or may be constrained by a tighter budget.
Other than Ostroff, the content side avoided the worst cuts this time around. It doesn’t appear that any additional shows were cut, but that’s probably because those teams were hit hard in October.
“We’re committed to building on our success in podcasting, delivering innovative features for creators, and continuing to invest in O&E podcasts,” said Spotify spokeswoman Rosa Oh. Hot Pod.
On the advertising and business side, the new cuts were more deeply felt. Employees who came to Spotify last year as part of Podsights and Chartable were among the divisions being laid off. Acquiring these two companies has given Spotify the ability to measure how shows are performing on the platform and put it in a better position to sell ads. And it’s working — the company grew ad revenue 26 percent in the first nine months of 2022 compared to the same period in 2021.
But those acquisitions have added more employees in roles similar to those at Spotify, especially since its 2020 acquisition of Megaphone. There was “a lot of duplication in job functions,” according to one person affected by the layoffs, who asked not to be named so they could freely discuss their former employers.
It goes to the larger issue that Spotify still has to find a way to make its many podcast business acquisitions — Anchor, Megaphone, Podsights, Chartable — work in harmony. According to that former employee, that hasn’t happened yet: “They don’t have a real strategy for their podcast yet. There are all these different technology stacks.”
Another Spotify employee affected by the layoff felt similarly. “There was a lot of confusion about how everything was supposed to work together,” they said, asking to remain anonymous so they could talk about their former employers.
As the 600 workers who lost their jobs yesterday try to pick up the pieces, the company will have to figure out how to make a leaner organization work again. While layoffs are always destabilizing, they haven’t come as a complete shock either. I heard that in the months leading up to the cuts, employees were told to limit business travel to critical events, and food and sports stipends were cut. Meanwhile, the rest will have to make do with the staff they have — Spotify has removed all job postings except for internships.
Hot Pod Summit adds another interesting guest – and a live podcast recording
The Hot Pod Summit is coming up next month and we have some more exciting programming news to share with you all: Conal ByrneThe CEO of iHeartMedia’s Digital Audio Group will join us for an in-depth interview. Verge Editor-in-Chief Nilay Patel. The interview will be live Decoderweekly podcast The Verge It asks executives, innovators and policymakers how they make decisions and where their industries are headed. We’re excited to host this conversation at the Hot Pod Summit and try to answer some of the big questions on the minds of many people across the industry.
If you’ve been invited to the Hot Pod Summit, be quick to remind yourself today This is the last day we can guarantee your place at the conference before we open up seats for additional guests.
If you would like to come but are not already on the list, please fill out our form here today is the end of the day to let us know you’re interested.
The Hot Pod Summit is part of On Air Fest, the premier cultural event for audio creatives and inspired listeners. This year’s creative festival takes place February 23-25 at the Wythe Hotel in Brooklyn with special sessions with Audie Cornish, Kara Swisher, Talib Kweli, Krista Tippett, John Cameron Mitchell, Craig Finn, Kevin Morby and Audible, Paramount, Topic Studios. , Simplecast, Stitcher, Pushkin and Vox Media Podcast Network, etc. You can learn more and purchase single and two-day tickets at www.onairfest.com. Plus, On Air hosts a first-ever podcast fan experience with exhibits and immersive rooms by Radiolab. About existence, My Favorite Crime, and more. The Podcast Experience runs all day February 23-26. Tickets at www.experiencepodcasts.com
That’s it for now. I’ll be out next week so you’ll hear from Jake.