There are debates about how fast podcasting will grow, but SiriusXM CEO Jim Meyer says there’s no doubt in his mind about what the future holds. “It’s going to grow exponentially,” he said in an interview with CNBC. Nine months after SiriusXM bought the streaming music service Pandora and suddenly found itself in the podcast business, Meyer said he’s now more excited about the strategic decision to bring the two companies together. And podcasting is one of the reasons.
“People have always loved talk content. But younger people consume it differently than people from my generation,” Meyer said. “In talk, there will always be shows and episodes and there will always be ways to cut that into snippets for different attention spans and different intentions.”
In one of SiriusXM’s biggest podcast deals to date, last month it announced a multiyear alliance with the Walt Disney Company’s Marvel Entertainment brand to create original podcasts for SiriusXM and Pandora. The venture will include both scripted and unscripted series, in addition to themed live events. Meyer said that deal is likely to produce a channel of content on satellite radio as well as content that is more podcast-oriented. “We’ll put it out there and we’ll see which way consumers go,” he said. “I think we’re going to find they’ll enjoy them in multiple ways.”
As much as the sister companies have focused on growing their podcast content this year, Meyer said that some work on the behind-the-scenes infrastructure remains. “We have a little bit of work to do to catch up on the technology side and I think you will see us very focused on that in the next three to six months,” he said. “Advertising technology is crucial and you need to be very good at it. We’re great at it in music, but Pandora never did it for spoken word. We need to get that bridged in the next couple of months.’
Meyer’s appearance on CNBC on Thursday came the same day as parent company Liberty Media held its annual investor day with shareholders. That also brought Liberty CEO Greg Maffei before the cameras, and in a separate conversation with the network he said he views a lot of potential in the audio business – especially podcasts. “Not only is there an upside in listenership and the kinds of content offered, but they’re under-monetized,” said Maffei. “I think there’s an opportunity to see increases in how podcasts and other forms of content are monetized.”
To many on the outside, the race by the big media companies to secure podcast deals with content partners and sign exclusives with producers looks a lot like what is happening in streaming video, where a multibillion dollar battle has pit giants like Disney, Netflix and Amazon against one another. Maffei said when it comes to podcasting the cost structure is “way more attractive,” despite “a little bit of a bidding war” for audio content. “You can’t spend on audio. I mean, a great podcast may be $250,000 a year. An hour of one of these high-end [TV] shows may be $10 million. The numbers are so far apart and the war is way less. The good news for us is we’re a serious player in audio,” he said. Maffei told CNBC he expects SiriusXM and Pandora to sign more exclusive deals for podcast content in the months to come.
In addition to its stake in SirusXM and Pandora, Liberty Media secured a 4.8% stake in iHeartMedia during its recent bankruptcy reorganization. That’s fueled speculation Liberty has its sights on taking control of the biggest broadcast radio company. But Maffei dismissed the idea. “We have no plan or intent on that today. We look at the terrestrial radio business as being interesting and have a lot of respect for what [CEO] Bob Pittman and [CFO/COO] Rich Bressler are doing there, so we’ll watch,” said Maffei. Asked what he’s looking for, Maffei said he’s focused on not only iHeart’s performance but larger market trends. “Some people think terrestrial radio is going to slide the way linear video has, others—including Pittman and Bressler—think they have a great future,” he said. “We own 4.8%, so we’re rooting for them.”
What Maffei said he finds most attractive about the broadcast radio business is that it has a “big funnel” with “a lot of listeners.” That could be an advantage when marketing subscription services like SiriusXM and Pandora.