Spotify shows how the live audio boom has gone bust

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Lots of news to start off the week. Let’s get right into it: Spotify Live gets the ax, the Obamas land another podcast deal, and iHeart signs a top wellness podcast.

Spotify Live is shutting down, and what remains of live audio is sparse

In the latest sign that live audio is well and truly on its way out, Music Ally reports that Spotify is shutting down its Spotify Live app. On the app, which still has a handful of chat rooms going, users get a notification saying that the service will go away at the end of the month.

“After a period of experimentation and learnings around how Spotify users interact with live audio, we’ve made the decision to sunset the Spotify Live app,” Spotify spokesperson Gayle Gaviola Moreau said in a statement to Hot Pod. She added that the company will continue to explore live streams in scenarios where it makes sense, like artist-focused “listening parties.”

The post-pandemic has not been kind to live audio, which thrived with the emergence of Clubhouse in spring of 2020. Clubhouse peaked in mid-2021 when pandemic lockdowns and restrictions still hampered normal socializing, snagging a whopping valuation of $4 billion. Since then, the number of monthly active users on Clubhouse has dropped by 82 percent, according to data provided by Sensor Tower.

While Clubhouse is still limping along, the companies that followed in its footsteps have largely abandoned their pursuits. Last year, Facebook folded its live audio rooms into its overall live chat feature. Last month, Reddit announced the shutdown of Reddit Talk. Spotify, which built its live product by acquiring Betty Labs in 2021 for more than $60 million, put the product through multiple rebrandings and brought on high-profile podcast hosts to make the app shine. But the app only amassed 670,000 downloads, according to Sensor Tower (for comparison, Clubhouse had 35 million downloads in 2021 alone). Spotify started to deprioritize its programming late last year, and given Spotify’s layoffs and belt-tightening, it seemed inevitable that the app would fall by the wayside.

What remains of the live audio ecosystem, aside from Clubhouse, is Twitter and Amazon’s Amp. Twitter Spaces emerged as the most successful of the live products, but it’s on shaky ground. As a platform, Twitter made the most sense for topical conversations, and it was well on its way to building Spaces into a comprehensive audio product complete with playlists mixing podcasts with chat rooms. Then Elon Musk took over, the podcasts were thrown out and most of the Spaces team was laid off. It may not go away, but Spaces is clearly not the priority while the company tries to salvage its valuation.

Amp, despite its layoffs, could prove to be more interesting. Though it does have chat shows, it is billed as a “live radio” app where would-be DJs can curate their own music stations and utilize the kinds of social features that came out of the live audio boom. To Spotify’s point about “listening parties,” social audio might have some legs when it comes specifically to music, rather than just listening to people talk. And if not, then Amazon will be just fine either way. 

Whichever way you look at it, it’s hard to argue that live audio is still all that lively. When Spotify, a company exclusively focused on audio, doesn’t see a way forward, it may be time to call live audio what it is: a (very costly) fad. 

The Obamas’ Higher Ground inks ad and distribution deal with Acast

After reportedly chafing at Spotify’s exclusivity model for podcasts, the Obamas are moving toward wider distribution for their audio projects. The former first couple signed a multiyear first-look deal with Amazon’s Audible after their deal expired with Spotify last year. And now, thanks to Audible’s shorter exclusivity window, Higher Ground has signed a separate deal with Acast, which will distribute their podcasts across other platforms.

With the new arrangement, advertisers can now buy spots through Acast on Higher Ground’s shows like Renegades: Born in the USA, the boomer fever dream pod featuring conversations between the former president and Bruce Springsteen, The Sum Of Us, hosted by author and policy expert Heather McGhee, and audio docuseries The Big Hit Show with Alex Pappademas.

Acast will also handle the ads and distribution for Higher Ground’s current and future projects produced originally for Audible. Last month, Higher Ground launched its first Audible podcast, Michelle Obama: The Light Podcast, which has a two-week exclusivity window for episodes on the platform. Once that window passes, episodes are then distributed by Acast to platforms like Apple and Spotify. 

It does seem like the Obamas achieved a happy medium between reach and the kind of big podcast money that only comes with exclusive licensing. And for Acast, this is undoubtedly a win. The company has already signed a number of high-profile shows, including WTF with Marc Maron and Anna Faris Is Unqualified, and the Higher Ground deal will only add to its cache in the industry.

iHeart signs On Purpose with Jay Shetty

See, the deals are still happening! Megahit wellness podcast On Purpose with Jay Shetty has signed with the iHeartPodcast Network. Shetty, who is an author, life coach, and the Calm app’s chief purpose officer (can we please cool it with the nonsense titles, honestly), launched the show in 2019. It has since become a mainstay among the top 25 shows on Apple Podcasts and Spotify.

Unlike some other audio giants, iHeart does not play the exclusivity game. When he appeared at Hot Pod Summit in February, Conal Byrne, CEO of iHeartMedia’s digital audio group, explained that the company has more to gain by distributing their shows as widely as possible than trying to corral people into the iHeart app (which, according to a study by Cumulus and Signal Hill Insights, only represents 3 percent of all podcast listening). 

And while Shetty is already comfortably positioned among the top podcasts, he may find it appealing that iHeart also has a massive broadcast network that can be used to plug his show and bring in even more listeners. “We have about 70-ish shows in the iHeart Podcast Network that drive over 1 million monthly downloads or more,” Byrne said at HPS. “The only reason we have that number is because of broadcast radio marketing.”

That’s all for today! See you next week.

Correction 5:05PM ET: A prior version of this article said that Twitter no longer stores old Spaces recordings. The company has actually stopped storing broadcast recordings.