What Impact Did Podcasts Have On The Company?

Spotify bulks up it podcasting muscle

In 2019, Spotify CEO Daniel Elk said in a company press release: “We think there’s a massive opportunity to modernize the podcasting space, much like we did with streaming music over the last decade… If we’re successful, we will not only grow the overall podcasting market, but we will make it much easier for all types of creators to build and monetize their audiences.”

George Witt, San Francisco-based podcast consultant notes: “Those were the heady times for Spotify as it bulled and bullied its way into podcasting. When a smaller or mid-sized company enters an industry that they have little familiarity with, there is moderate damage. But when a company the size of Spotify entered podcasting it had a positive effect and one negative unintended consequence.”

Witt continues: “First, Spotify introduced podcasting to millions of its streaming customers. That step was like a solar flare for podcasting. Suddenly, people noticed it. Second, Spotify made a lot of acquisitions and added a lot of new shows that, in essence, created a podcast bubble.”

“All bubbles burst,” Witt deadpanned. “When they do, there is significant collateral damage.”

Spotify first acquired Parcast and Gimlet in 2019 as part of its one billion-dollar expansion into podcasting. Yet, the following year, according to Forbes, Spotify generated $215 million, in podcast revenue but also saw a $110 million, negative impact on gross profit, with the company insisting to Forbes it was still in “investment mode.”

In another move at brand expansion, Spotify also formally launched its audiobooks business in the U.S. with a library of 300,000 works for purchase and the company admits it is exploring additional business models, which could potentially include an ad-based model in the future.

The Spotify bubble burst

Three years later, the good times stopped rolling. In October 2022, The Hollywood Reporter reported that Spotify canceled 10 of its original podcasts from studios Parcast and Gimlet over the next month.

Gimlet’s How To Save A Planet, Crime Show and Every Little Thing and Parcast’s Medical Murders, Female Criminals, Crimes of Passion, Dictator, Mythology, Haunted Places and Urban Legends wrapped up in the next month.

According to The Hollywood Reporter, the cuts impacted under five percent of staff working on original podcasts at the audio giant’s in-house studios — which includes Parcast, Gimlet, The Ringer and Spotify Studios — while others working on the canceled shows will be reassigned to different projects.

Spotify cancelled its in-house, founding original podcast studio, internally known as “Studio 4” (or Spotify Studios), on January 11, 2022. The company disbanded the founding team and laid off or reassigned the 10 to 15 employees working in this specific division.

In December 2023, Spotify officially canceled the acclaimed podcast Heavyweight. The cancellation was part of a major corporate restructuring and cost-cutting initiative at Spotify, which included laying off a significant portion of its workforce and shifting its focus away from in-house studio productions to more licensed, personality-driven chat shows.

The correction was underway.

Spotify innovates and monetizes

Despite the loss of several innovative studios like Gimlet and Parcast, Spotify appeared to gradually find its podcasting “sea legs.” In mid-2026, Spotify asserts that “it has transformed podcasting from a static, one-way audio experience into a dynamic, integrated, and highly monetizable ecosystem,” and the company may have a point. By heavily investing in infrastructure, the company insists it has introduced several industry-first innovations.

“It’s easy to pick on the ‘big guy’ in any industry,” notes George Witt. “But Spotify has made measurable gains for the industry in general, for podcast creators and for podcast consumers.”

Mr. Witt ticks off a list of innovations: “Spotify has integrated video deeply into the podcasting experience, allowing creators to seamlessly transition between audio-only and full-screen video. Through acquisitions like Megaphone and the Spotify Audience Network (SPAN), Spotify created a targeted advertising marketplace. This allows publishers to seamlessly monetize content, run A/B split testing on ad creatives, and benefit from machine-learning-powered bidding. They unified their hosting, recording, and publishing tools into a single, comprehensive management platform.”

According to The New York Times, Spotify paid out over $100 million to podcast publishers and creators worldwide in just the first quarter of 2025, driven by expanding ad-revenue sharing and subscription programs

Spotify currently has a slate of more than 500 original and exclusive shows produced across its four in-house studios.

Like any industry, however, too much power concentrated in all leverage points can stifle competition and innovation, exclude small, independent creators, and force consumers to pay higher prices.

Look what happened to Ticketmaster once it was bought by Live Nation. A federal jury in New York just found that Live Nation and its Ticketmaster subsidiary illegally operated as a monopoly that suppressed competition and overcharged consumers

Let’s end with insights from one of the brightest and influential people in podcasting, Bryan Barletta, Partner at Sounds Profitable and President of Podcast Movement.

Barletta observes: “When Spotify expanded beyond music and into podcasting, it was a major jump that immediately captured the attention, and scrutiny, of the audio and entertainment industries. It’s turned out to be a move that’s enabled them so many things in such a short period of time. From live-streaming to video to audiobooks to work out classes; podcasting was Spotify’s first major step away from music.”

Mr. Barletta continues: “While, there have been plenty of times when we can question how they spent money, decisions they made on a technical and acquisition space, or even their alignment to the goals of what we see in the business of podcasting, ultimately, they have been an incredible steward for such a large team running in so many different directions with a global footprint. We are better as an industry for having Spotify as a part of it, and every improvement that we are seeing in their platform for podcasters and creators is visibly imprinted with the feedback and buy-in by the companies that have made podcasting what it is today, showing a new collaborative side to Spotify that grows every single year.”