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Spotify Acquires Gimlet Media, Anchor in Podcast Push

07 February 2019

The company said it will spend up to $500 million on podcast start-ups this year; the deal with Gimlet is rumored to be in the neighborhood of $200 million. With these acquisitions, Spotify cannot only become the premier producer of podcasts but also the leading platform for podcast creators.

Swedish audio streaming company Spotify has acquired podcast production company Gimlet Media and do-it-yourself podcasting platform Anchor to increase its podcast offerings.

According to Recode, Spotify is around $230 million for Gimlet.

"The format is really evolving and while podcasting is still a relatively small business today, I see incredible growth potential for the space and for Spotify in particular, " he wrote. And Anchor has completely reimagined the path to audio creation, enabling creation for the next generation of podcasters worldwide-15 billion hours of content on the platform during Q4.

We are building a platform that provides a meaningful opportunity for creators, excites and engages our users, and builds an even more robust business model for Spotify in an industry we believe will become significantly larger when you add Internet-level monetization to it.

Podcasts have enjoyed a popularity boost in recent years, with weekly listening numbers reaching a high of 48 million in the USA in 2018 - and Spotify has taken notice.

It's easy to see why Spotify views podcasting as a huge area of growth.

In a separate blog post, Ek suggested that "over time, 20% of all Spotify listening will be non-music content", adding that Spotify's podcast users "spend nearly twice the time on the platform" as those who listen exclusively to music.

In its earnings letter to shareholders, Spotify said podcasts were part of its strategy for faster revenue growth. It seems like Spotify may have found an opportunity.

Spotify and Gimlet declined to comment on the acquisition price.

In a separate blog post, company CEO Daniel Ek said, "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".

Gimlet spokesman Kevin Turner said the company's 120 employees would be joining Spotify. Anchor will bring its platform of tools for podcast creators and its established and rapidly growing creator base.

"We will offer better discovery, data, and monetisation to creators".

Separately, Spotify announced that it had achieved its first quarterly profit, and for the first time in the firm's history, its operating income, net income, and free cash flow were all positive.

Spotify Acquires Gimlet Media, Anchor in Podcast Push