|Can Luminary entice podcast listeners to pay to listen? |
E ric Zorn
April 19, 2019
Tuesday may mark the beginning of the end of the free ride for podcast listeners.
That’s launch day for Luminary, a heavily capitalized startup that for $8 a month will offer a package of more than three dozen exclusive audio programs starring such notables as Conan O’Brien, Lena Dunham, Trevor Noah and Chicago’s own David Axelrod.
Pay-to-listen podcasts have been around since the dawn of the medium roughly 15 years ago, but for the most part they’ve been niche products aimed at devoted fan bases. The popular, buzzy podcasts atop the iTunes charts have been free and, increasingly, so plentiful that even devoted listeners can’t keep up.
Attempts to erect paywalls and cash in on the appetite for quality programs have been unimpressive.
Certain producers are able to sell “bonus” content, extra segments, for a modest fee, and others are sustained through crowdfunding sites such as Patreon. But most pay the bills with commercials.
Those bills can be small. Many podcasts are just people yakking into a microphone.
Or they can be considerable. The most ambitious offerings feature extensive shoe-leather reporting and take months to produce.
There’s a reason dollar signs are in the eyes of entrepreneurs. Survey data released last month by Edison Research and Triton Digital showed that 51 percent of Americans ages 12 and older have listened to a podcast, up from just 30 percent five years ago, and that 32 percent listen at least monthly, more than double the rate of five years ago.
Lena Dunham has signed up be on podcast provider Luminary. (Jay L. Clendenin/Los Angeles Times)
These trends are driven by record-high ownership of podcast-enabling devices — smart speakers, now in 23 percent of homes, and smartphones, now carried by 86 percent of Americans.
They’re also driven by the stunning range and quality of these on-demand shows. I now subscribe to 77 podcasts. The topics covered include local, state and national news, pop culture, the law, philosophy, science language, old-time music and University of Michigan sports. Some are weekly, others daily. And I’m lucky if I get through 20 of them a week, even listening at double speed as is my wont.
When someone offers me a must-listen recommendation, I immediately start trying to figure which show I’ll have to bump out of my regular rotation.
Which is why I wonder if Tuesday might instead mark the beginning of the end of the idea that consumers in great number will pay for podcasts.
Luminary reportedly is starting with nearly $100 million in funding and the stated goal of becoming the Netflix of podcasting.
The potential analogy is apt — for a monthly fee, Netflix offers TV viewers a range of exclusive, high-quality content as well as conventional movie and TV programs.
But Nicholas Quah, who writes the Hot Pod newsletter that covers the industry in depth, is skeptical.
“Netflix didn’t build an initial sustainable user base off the strength of exclusives,” he wrote last month. “It build that audience through film and television products that had already been tested in the marketplace, but were inefficiently monetized, insufficiently monetized, and/or hard for people to access.
“To put it another way: Netflix’s early success was rooted in giving users products they already knew they wanted, that they were already habituated into paying for,” Quah wrote. “That allowed them to expand into a different kind of business while being backed by the stability of the older one. Netflix’s original content journey was gradual.”
He asked the critical question: “What specifically about Luminary’s portfolio should convince me … to pay $8 a month instead of turning to the enormous universe of free alternatives?”
“Enormous” doesn’t even say it. The podcast directory site Blubrry estimates there are more than 130,000 active podcasts (and many times that number of discontinued podcasts).
So the question for Luminary is, how can it succeed where others have not? How can it persuade customers already overwhelmed with podcast choices and feeling inundated by video providers rattling their tin cups to put yet another monthly subscription fee on their charge cards?
What’s our limit? Last month, Apple announced Apple TV Plus, yet another pay platform that will offer streamed original or exclusive video content. Although the company didn’t disclose its exact offerings and the pricing model, I instinctively recoiled.
Just to participate in dinner party conversations anymore you have to subscribe to Netflix, HBO and Amazon Prime Video. Maybe also CBS All Access, Showtime and Starz, if your social circle consists of engaged viewers.
And yes, I know, TV has never been better. Subscription models drive quality and consistency. They’ve inspired commercial-supported networks to up their game considerably.
Who knows? We may someday look back on the pre-subscription days of podcasting with the same patronizing disdain with which we now look back on the days of antenna TV.
Will Luminary be the breakthrough product? Or — my guess — will it be Spotify, Pandora, Audible or SiriusXM, established streaming-audio giants that are integrating on-demand programming into a much broader range of offerings? Either way, to change the fundamentals of this medium, some subscription service will have to corner the market on at least one critically hailed “it” podcast that everyone’s talking about, the audio equivalent of “House of Cards,” “Game of Thrones” or “The Handmaid’s Tale.”
Subscribe or miss out. It’s a powerful incentive.
Not yet powerful enough for me, but when it comes to possibilities, I’m all ears.