The Hollywood Reporter
Spotify’s relationship with the Sussexes was, in the end, a mess.
The two parties formally ended their exclusive podcast deal on June 15 in the press after The Wall Street Journal reported that Spotify was not renewing Meghan Markle’s Archetypes show for a second season and the Duchess was “continuing to develop more content for the Archetypes audience on another platform, according to a statement shared with the paper that was first attributed to a spokesperson for Archewell Productions before being changed to WME, which signed Markle and Archewell in April.
The Journal story is believed to have ultimately fast-tracked the end of the Spotify–Archewell relationship, which had still been in place prior to the story’s publication but concluded with a carefully worded joint statement released that evening announcing the two parties had “mutually agreed to part ways.” But Spotify’s Bill Simmons, who leads podcast monetization for the audio company, called into question how amicable the split was when he labeled Markle and Prince Harry as “fucking grifters” during a June 16 episode of his eponymous podcast.
That isn’t to say Spotify is entirely blameless in the breakdown of the relationship. One dealmaker notes to The Hollywood Reporter it is “very difficult to get anything done at Spotify” and that there isn’t much “flexibility with these big tentpole deals.”
Other high-profile talent deals have also ended without renewal, including with Barack and Michelle Obama, whose Higher Ground decamped for Audible, and Esther Perel, who left for Vox Media. Jemele Hill, whose show Jemele Hill Is Unbothered had been exclusive to Spotify since 2019, is also expected to leave after her contract ends this summer.
The podcasting division at Spotify has undergone major leadership upheaval with the recent departures of former chief content and ad business officer Dawn Ostroff and top podcast partnership executive Max Cutler. Significant layoffs have impacted the podcast division this year, with the most recent caused by the merger of in-house studios Gimlet and Parcast into one centralized studio, Spotify Studios, despite the audio company’s pricey acquisitions of the two.
Spotify CEO Daniel Ek acknowledged the “overpaying and over investing” on podcasting and talent deals during an April 25 earnings call with analysts. “We’re not going to do that [anymore], and we’re going to be very diligent in how we invest in future content deals,” Ek said. “The ones that aren’t performing, obviously, we won’t renew. And the ones that are performing, we will obviously look at those on a case-by-case basis on the relative value.”
Still, having only released 12 episodes of Archetypes and one holiday special during their entire time with Spotify, the Sussexes aren’t set to receive the full payout of their reported $20 million Spotify deal. (It’s unclear how many episodes they had to hit to get that pay figure, though typical Spotify exclusive deals require multiple series or multiple episodes of a show released on a regular basis, such as with a weekly show.)
Archetypes could still live on elsehwere, however, as Archewell does retain the rights to Markle’s show and now can openly shop around the podcast to other platforms. But wherever Archewell Audio does go next, they will be negotiating at a time when major podcast publishers become wary of expensive talent deals, especially during a slower market.
Though some companies, most notably Amazon’s Wondery, have experimented with exclusive windowing deals, most platforms have largely agreed that forking over the millions needed for an exclusive deal and losing out on additional listenership isn’t a smart choice.
Conal Byrne, the CEO of iHeartMedia’s Digital Audio Group, during a Feburary conversation at the Hot Pod Summit said the exclusive, mega-deal driven model didn’t make sense for podcasting, which he said thrives from an open ecosystem.
“They can be worth it if a creators is that good, you may want to pay that. Where it tripped up is these exclusive distribution models that made sense for streaming services like Netflix and Hulu, and maybe Prime, because they were solving problems,” Byrne said. “In [podcasting], I couldn’t identify the problem that that was solving, and therefore I think the industry tripped up on it.”
And for their part, Spotify has essentially abandoned the exclusive model for its new talent deals and is releasing some of its previously exclusive shows, like Emma Chamberlain’s Anything Goes, on other platforms. At Cannes Lions, the audio giant revealed the newest star to join its roster: Trevor Noah.
But unlike past deals, the comedian’s upcoming podcast will be available wide on all major platforms.
Julie McNamara, Spotify vp and head of global podcast studios, stated that partnering with Noah, “will make for captivating storytelling that will delight our more than 100 million podcast listeners around the world.”
As one person familiar with the matter tells THR, Spotify needed the exclusive deals in the early stages of its podcasting expansion to grow its audience. Now that they have the listeners, releasing shows on competing platforms lets Spotify tackle its next goal: making money off of podcasts.
Source: Hollywood Reporter
