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Spotify Launches Podcast Subscription Plans

Courtesy of Spotify

Spotify has announced a podcast subscription solution for creators hoping to attract listeners willing to pay a little extra for bonus content.

Starting soon, creators using Spotify’s podcast creation tool Anchor (which Spotify acquired in 2019) will be able to designate episodes as subscriber-only before publishing to Spotify and other platforms. Like Patreon, a subscriber platform for podcasts and other content, podcasters will be able to offer various tiers of subscriptions that can be tailored based on material. At present, Spotify has three price tiers: $2.99, $4.99 or $7.99 per month.

For the next two years, creators will keep 100% of their subscriber revenues (excluding transaction fees) before a 5% fee kicks in starting in 2023.

Spotify launched the program today to a test group of 12 creators — including NPR — who will begin releasing subscriber-only content to their existing feeds. The company is accepting submissions to be added to the early adopter list, and will expand globally "over the coming months," it said.

"By enabling wide distribution of subscriber-only content, our aim is to help podcasters maximize their subscription audiences and grow them from their existing listener bases," the company said. "Within Spotify, this content will be searchable and discoverable like any other podcast episode."

Podcast listeners will start seeing small lock icons next to premium episodes in their podcast feeds. Clicking on the button will prompt a pitch to "support this podcast by becoming a subscriber."

Courtesy of Spotify

Spotify’s top competitor in the podcasting space, Apple, announced last week that it will launch a similar podcast subscription to creators and fans starting next month. Apple subscriptions will provide support for ad-free listening, exclusive content, and early access to new shows, however, there will be more fees involved. In line with other App Store purchases, Apple will keep 30% of sub fees for the first year and 15% annually after that.

Apple’s podcast division helped popularize the format, but in recent years has given up its lead to Spotify, which has grown rapidly. Spotify's acquisition of Anchor in February 2019 marked its third podcasting company acquisition that year -- after Gimlet Media and Parcast -- spending upwards of $400 million total on the trio. In November, Spotify added podcast advertising and publishing company Megaphone to its arsenal, too. According to market research firm eMarketer, Spotify is expected to pass Apple Podcasts in U.S.-based monthly podcast listeners this year, with 28.2 million listeners every month, compared to Apple’s 28 million.

For the most part, Spotify's podcasting push has so far focused on big-name talent, inking content deals with the likes of Joe Rogan, Kim Kardashian and Barack and Michelle Obama. But today's announcement of a new podcast subscription is part of a three-pronged effort from the company to help independent podcasters monetize, which also includes the newly-announced Spotify Open Access Platform (OAP) and audio advertising marketplace Spotify Audience Network (SPAN).

The OAP, which is currently in testing mode, will allow podcasters who have paid subscriber bases on other platforms to deliver paid Spotify content directly to those bases, using their existing login systems. SPAN, which Spotify first announced at its Stream On event in February, will begin rolling out to select independent creators using anchor starting May 1.

It's only Tuesday, and this news already joins a string of announcements from Spotify this week. Yesterday, on the music streaming end, Spotify began hiking prices for Family Plan subscribers in the U.S. and U.K. and launched a Facebook miniplayer allowing users to stream music directly within the social media platform.