SERVANT OF POD WITH NICK QUAH
Episode 5 Transcript: Stitcher Sold
Fri, 8/21 3:15PM • 13:24
stitcher, sirius xm, podcast, feel, big, company, caroline, acquisitions, iheart media, deal, employees, wnyc, spotify, joining, leadership, money, sale, talent, cooper, people
Caroline Crampton, Nick Quah
Nick Quah 00:02
From LAist Studios, this is Servant of Pod. I’m Nick Quah. We're coming to you with a bonus drop today because there's been a pretty big development that has a ton of ramifications for the podcast industry. And we'll get to that after the break. Last night, The Wall Street Journal reported that Stitcher, one of the oldest podcast specific companies, is being sold by Scripps to the satellite radio giant Sirius XM for around $300 million. We talked about the possibility of this at last week's new segment, when a report in The Information confirmed that Scripps was shopping Stitcher around. I should say, this is the largest podcast deal we’ve seen yet. In my view, Stitcher had been in a bit of a tough spot. They do a bit of everything: content creation, ad sales, they have an app—which is a complicated position to be in in 2020, when you have substantially larger companies like Spotify and iHeart Media also trying to do everything, and are able to easily outspend you on deals. To help think through this development, we brought back Caroline Crampton, HotPod’s UK writer. Hey Caroline.
Caroline Crampton 01:23
Nick Quah 01:24
First question: what's the significance of this sale?
Caroline Crampton 01:29
I think its size is pretty significant, and I think as well what it represents about the moment we're in at the moment—extreme consolidation, it feels like
Nick Quah 01:39
Yeah, and Stitcher, for the longest time, had been this interesting end-to-end company. And nowadays, like when everything is super hyper corporatized, AND you can't really compete unless you have a lot of money, you probably don't have a really clear path to do very much, so it just kind of strikes me as almost like an inevitable outcome. Do you feel the same way?
Caroline Crampton 02:00
Yeah, that sounds fair to me. I think I could see a pathway for Stitcher maintaining its position, but I couldn't necessarily see a pathway for them to grow, as you say, with these really big spending massive companies coming in above them, as it were. So I suppose this deal does provide a path for the entities within Stitcher, their various sort of constituent networks like Earwolf, and the My Favorite Murder people, and so on. It gives them a path to growth that maybe they didn't have in its previous incarnation.
Nick Quah 02:30
Absolutely. And I think it's sort of worth noting that Stitcher, for the past couple years, at least since Spotify started making its major acquisitions, I think its big sort of differentiating point was its robust ad salesforce. I don't think there was any other company in the market that had that depth of history and expertise. And so it does feel like at the very least Sirius XM is picking up a salesforce that nobody else has. And that kind of, to me, feels like one of the main points of the sale.
Caroline Crampton 02:58
I think that's a really good point. I think that there's a depth of experience with Stitcher’s institution, and also some of the people there, that a lot of companies that have got into podcasting very quickly and very recently just don't have.
Nick Quah 03:11
What do you think this means for the way we should think about Sirius XM? Sirius XM is the major satellite radio company. They also own Pandora. They recently made another podcast acquisition in Simplecast, which is kind of a back end hosting technology platform company. This feels like a “deal now, think later” kind of thing. I am not sure how they're going to manage all those different brands at the same time, which suggests, at the very least, there'll be some changes coming to Stitcher, at least in the immediate future, I think.
Caroline Crampton 03:41
Yeah, I think that, as I think we said last week, Stitcher is fairly unusual these days in being a kind of end-to-end podcast operation. They have that ad sales element, but they also have a pretty, you know, reasonably-used app. They also have the content and they have some pretty decent IP in there as well. So they sort of had a little bit of everything. And since Sirius XM already owns all those other things, as you said, it's kind of hard to see how they're not now duplicating some of that.
Nick Quah 04:09
So Stitcher has been, historically, when I've spoken to a lot of podcasts in the past, for the most part, they've been good partners. They've been sort of really agreeable, non-hyper aggressive corporate partners in their, sort of, creative collaborations with creators. I—to me, that—I feel like that's going to be a really interesting canary in the coal mine to see whether Stitcher’s culture will change as a result of this new ownership. But what are the other things that you will be watching moving forward about the way the sale will affect Stitcher?
Caroline Crampton 04:38
That's definitely a big thing. And Stitcher does have that reputation for being “the good guys”, if you want to put it that way.
Nick Quah 04:45
Which is ironic because they used to be, I feel like they used to be, the sort of, like, symbol of corporatization.
Caroline Crampton 04:50
Nick Quah 04:51
Like in 2017.
Caroline Crampton 04:52
If you were a comedian and you were selling out, you did it with Stitcher.
Nick Quah 04:56
Caroline Crampton 04:57
Obviously, that's changed quite a lot, given the other acquisitions and so on that we've seen. I do think that the path that Sirius XM eventually works out for themselves is really, really important to watch out for. Are they going to join Spotify and iHeart Media in this sort of big race to buy up exclusive content? Are we going to see more Joe Rogan-type deals? Just not traditionally something that Stitcher’s really gone for, those really, really big-money talent acquisitions, but with that power behind them, is that now the strategy?
Nick Quah 05:31
I think it's inevitable. I think that's definitely a strategy because Sirius XM, fundamentally, is in the sort of radio talent business. Their strategy is to throw sort of money at big name talent, Howard Stern being sort of like their, sort of, diamond in the set there. And so it does feel like this the very least we will see that kind of competition from Sirius XM in these sort of, quote-unquote “higher end” deal-making processes.
Caroline Crampton 05:54
I also think there's something interesting that we should watch out for with the branding. With all these different existing companies that they've now acquired—Simplecast has probably less name recognition than Stitcher, but not none—is Stitcher going to continue as the Sirius XM podcast division, or does it become “Sirius XM Podcasts”? I think it’s interesting.
Nick Quah 06:16
What do we gain and what do we lose from this, as consumers?
Caroline Crampton 06:21
I think there is going to be a bit of a, “Is this the end of the old podcasting times?” You know, the sense that, as you say, Stitcher was once upon a time, a big player in a small pond and there was something maybe sort of benevolent feeling about that. If you think back to a time of podcasting’s self-image, at least, as a kind of DIY—
Nick Quah 06:43
Caroline Crampton 06:44
—streaming, scrappy industry, Stitcher, I think, was the helping hand reaching down to some of those people to sort of help them level up. So I do think there's going to be some nostalgia and feeling that we have lost something there in that Stitcher is now just part of another massive corporation, and that completely changes the culture of any deals that they might do. In terms of what this might be the beginning of, or what we might gain, I think, for a certain type of person, and I'm thinking mostly celebrities, influencers, sports stars, that kind of thing, I think the market for their podcasts just heated up once again.
Nick Quah 07:22
It just gets even more competitive for people who already have power and value.
Caroline Crampton 07:27
I do think that that's, you know, what we've seen already is that, you know, celebrity podcasts do seem to be a first stop for a lot of these companies.
Nick Quah 07:36
Right, the prime beneficiaries of these arrangements. My sense is what we are losing that is, you know, that's kind of unique, is I think we're losing sort of what feels like a middle-class company. I think there's an interesting argument to make that you can't really stop this kind of corporatization from happening, especially when a space heats up and gets more popular and just becomes more valuable to advertisers, and creators, and people who have money in general, but what you would want, at the very least, is a company that's robust, that's able to build mid-sized shows sustainably, and to serve that part of the creative market. And that's not to say that there aren't companies already doing that pretty well, I think, arguably sort of Maximum Fun and Headgum are two networks that are still very much independent, and still very much serving a certain kind of quote unquote, “middle-class” show. But Stitcher used to be, I think, one that felt like it was able to build projects that you would think would be kind of quirky, or, you know, they sort of pursued projects that aren't obvious, from a sort of, you know, corporate media standpoint. It's sort of an interesting thing to lose at this point in podcasting’s sort of history. To me, it also opens up the opportunity for another company to tap into this way. Also, as I’m sort of saying this out loud, I'm thinking that we're talking about it as if it's the end of Stitcher. Do you think it's the end of this kind of company?
Caroline Crampton 08:57
I don’t think it's the end of this company. I mean, it'll continue in some form under the much bigger umbrella of Sirius XM. I do think whether they choose to keep the brand name is an important point, actually, towards what you're saying. Because if they're even going to try and continue with that kind of sort of middle-to-large role, as it were, then they’ve built up a lot of goodwill under the name Stitcher, so it might well be worth keeping if that's the play. But yeah, I think it is a developing problem in podcasts, actually, this missing middle. We've written about it quite a bit in Hotpod before, about if you're not a small show, but you're also not a massive one, where is your natural home these days? What's your natural monetization direction, and all this kind of stuff? It does feel a bit like there's still some space there.
Nick Quah 09:46
Before we wrap up, there was another piece of news that's worth tracking because it's—I think it's fairly important to hear. There's been some commotion happening at WNYC, and I believe you've been tracking it a little more closely than I have. Could you walk us through that story, Caroline?
Caroline Crampton 09:59
Yes. So, this, in recent times, has its origins in the appointment of a new editor in chief for WNYC, who is Audrey Cooper, who joins from the San Francisco Chronicle. But this actually has roots way back, going back years now. 2017, there was a big shakeup at the station that ultimately ended up in the departure of New York Public Radio President Laura Walker. There were lots of harassment allegations, bullying allegations; some top talent left the station. And after that, there was a real reckoning that, you know, there was apparently an internal, lots of internal discussion and investigation, particularly employees of color and black employees contributing to listening exercises and so on to try and turn the thing around and get a better, better leadership going forward. There's now been a letter sent to the trustees and management of the station, signed by 145 employees, calling on them to fulfill the promise of diverse leadership, which they don't feel that Audrey Cooper's appointment does. The reasons for that that they state being that, firstly, she's white; secondly, she doesn't have a sort of radio/audio background, she's really a print journalist; and also, she's not particularly rooted in New York, and she's joining from the west coast. And so for all of those reasons, staff are expressing their disappointment that they've taken part in these years-long processes, just to feel like they're getting more of the same.
Nick Quah 11:29
So what it does feel like is that it's emblematic of what feels like a performative process, in which the sort of leadership, and structure, and management structure, you know, engages in these listening sessions and basically try to engage in these, what feels like, acts of appeasement to the workers within an institution or advocating for better outcomes for the institution, while at the end of the day doing something that feels like it doesn't actually draw from those inputs at all. And so, you know, what's further complicated about this is the fact that there in that letter, I think there was no sort of clear set of reforms or clear set of outcomes that's being demanded—at least that's my understanding—and so I feel like I have a bit of confusion as to how this will move forward effectively for all parties.
Caroline Crampton 12:11
Yeah, that that's pretty much where it's at. The letter doesn't go as far as to call for, you know, Cooper to step down from the job before she's even really taken it up or anything like that. It's really just a statement of dissatisfaction with how what felt like it was supposed to be a productive internal process has not been, and so the employees have gone public with that, and in an attempt to get some kind of action—what that action is going to be though, I don't think we can really say yet.
Nick Quah 12:41
Well, big weekend news. Thanks so much for joining us, Caroline.
Caroline Crampton 12:44
Thanks very much for having me.
Nick Quah 12:55
Servants of Pod is a production of LAist Studios. And keeping with the theme, we have a new episode coming out tomorrow where I talk with Hank Green about big money in podcasting, which, you know, great timing.