Audio, thanks in large part to podcast, is enjoying a burst of attention and the head of radio’s largest operator says how the two platforms harmonize is working to its advantage. “These new forms like podcast have really super-charged radio again because it’s really an extension of the radio experience,” said iHeartMedia CEO Bob Pittman. In an interview with CNBC, he noted that while perceptions of audio may be changing, the reality is radio use hasn’t been disrupted by digital in the same way television or newspapers have.
“Radio has basically been unchanged in reach,” explained Pittman. “Radio is really about the companionship. We’re your friend riding with you in the empty seat in the car; we’re your friend chatting with you while you’re cooking, brushing your teeth, doing some work that you want to get your mind off of, or you’re walking or whatever. And I think companionship is probably more valuable today than ever, especially in this era of always looking at the phone and living in this very fragmented society.”
Month after month Podtrac data shows iHeartMedia is the largest commercial producer of podcasts while NPR is the biggest noncommercial podcaster. Pittman says the glaring common thread among two companies is their broadcast roots. “We’re both radio and podcasting, and the two work in tandem,” he said. “Podcasting is not so much a separate bolt-on business but it’s really an extension of what we do on radio.”
It’s a conclusion that other radio executives have also come to, and the industry has poured millions of dollars into building out a podcast business. Most notable, Entercom has reshaped the Radio.com app with a bigger emphasis on podcast content. Since podcasting remains a medium seeking additional consumer adoption, Pittman told CNBC that new competition may be more of a help than hindrance.
“Anybody who gets into podcast helps us because we’re the leader,” he said. “Everybody who comes in brings somebody new to podcasting and we’ve got the big library and the big shows and so bringing them into the podcasting ecosystem is very good for us. So we’re encouraging everybody to get into podcasting.”
The comparisons between podcasting and Netflix are now well-worn and many in the industry shy away from company claims of being the so-called Netflix of audio. Pittman is no different but said in the interview that Netflix did color how iHeartMedia built its podcasting business. He said while television networks were comfortable licensing their content to a company that had the look and feel of TV, it’s a model he concluded wouldn’t work for iHeart. That’s because he views it as “an extension” of radio. “That’s why it was so important for us to own podcasting,” said Pittman. “It’s so important that it’s all one seamless operation so we can go back and forth between podcast and radio with the consumer—we’re really one audience and multiple platforms.” He did acknowledge, however, that if iHeart were to operate the podcast business separately, he said it might be given a better valuation among Wall Street investors.
Smart speakers have yet to become a major access point for podcasts, but Pittman said the fast-growing device segment is helping fill a gap that has been developing during the past decade in the broadcast radio reach model. “The weakness of radio was we lost a lot of those clock radios, home radio and kitchen radios and suddenly here’s the smart speaker. And where do people put them? The bedroom, the kitchen, the living room—exactly where their radios were,” he said. “It reinvigorates the home listening experience for us.”