Report: Apple Mulls Podcast Subscription Service

Apple Inc. is working on adding a subscription service to its podcasting business in 2021, part of a broader push that has included funding new original programs, according to a reports by Bloomberg citing people familiar with the matter.

Apple has discussed the plan to create a subscription service with its partners, said the people, who asked not to be identified because of nondisclosure agreements. The company also has talked about stepping up funding for new shows and marketing.

The plan to create a subscription tier, first reported by The Information, would put Apple in closer competition with Spotify Technology SA. Shares of that company tumbled more than 7% on Friday.

Apple, based in Cupertino, California, declined to comment.

Apple has been the dominant distributor of podcasts in the U.S. for more than a decade, offering the programs for free. But the company now faces significant competition from two of its biggest rivals: Spotify and Amazon.com Inc.

Apple also is under pressure to get more revenue from services, rather than just its big moneymakers like the iPhone. A podcast subscription would further that end.

The company recently launched Apple One subscription bundles as well, and it would make sense to make the podcasts service part of that. If it does, Apple would likely add a significant number of users automatically by charging them little or nothing.

Spotify, meanwhile, has invested hundreds of millions of dollars in podcasting shows and technology, and has robbed Apple of some the most popular podcasts in the world. The top show, “The Joe Rogan Experience,” is now exclusive to Spotify.

Spotify has already dethroned Apple as the leader in online music, and by fusing podcasts with its music service, the company threatens to do the same in that market. Spotify has eclipsed Apple as the leading provider in many territories outside the U.S.

Amazon, a competitor to Apple in the market for smart speakers, is also increasing its investment in podcasting. The company has bankrolled original series for its audiobook arm Audible and added podcasts to its music service as well. It also agreed to acquire podcasting company Wondery last month.

Meanwhile, the website Engadget reports Spotify has reportedly considered a separate subscription for exclusive podcasts as well. The streaming giant has invested heavily into podcasts over the last few years. It has spent over $800 million on snapping up podcast companies and securing deals with the likes of Joe Rogan, the Obamas and Prince Harry and Meghan Markle. 

Some other podcast services have locked certain shows behind paywalls, including Luminary and Stitcher (which SiriusXM acquired last year). Amazon is also making waves in the podcast world, as it recently bought the Wondery network. 

Apple moved into podcast production last year with an interview series featuring Apple Music radio host Zane Lowe. Last May, Bloomberg reported that Apple was looking to buy podcasts and make them exclusives, and to develop spinoff and companion podcasts for Apple TV+ shows and movies.

The often controversial Joe Rogan Experience hit Spotify on Sept. 1 and became exclusive to the platform in December. After making its debut on Spotify, it quickly rocketed to the top of the service’s podcast rankings and, in just three months, has become the most popular audio show of 2020 among its global listenership, according to The Hollywood Reporter.

The other most popular podcasts from this year included TED Talks Daily, The Daily, The Michelle Obama Podcast and Call Her Daddy. Of those shows, only The Michelle Obama Podcast is a Spotify original. It debuted exclusively on Spotify in July before rolling out onto other platforms in September.

In the U.S., the top podcast was NPR News Now followed by The Joe Rogan Experience, The Daily, Call Her Daddy and The Michelle Obama Podcast.