The Duke and Duchess of Sussex, otherwise known as Harry and Meghan, are being paid a reported $25 million to produce podcasts for Spotify. Archewell Audio, their newly formed audio-first production company, signed a multiyear content agreement with Spotify in December. That deal is coming under scrutiny in the U.K. where a hearing in the British Parliament this week focused on streaming.
Horacio Gutierrez, Chief Global Affairs Officer at Spotify, told lawmakers that the streaming company relies on a “completely different set of economics” with podcasts compared to its streaming music service.
“Like a lot of our services, there is a market for certain talent because they command a certain amount of consumption,” said Gutierrez. “We don’t get to negotiate directly with artists the way we negotiate with podcasters or people who create podcasts, so the structure of that market is very different,” he explained.
If the royal deal figures are correct, it would mean that Harry and Meghan are working for a quarter of what Spotify is paying Joe Rogan. He has signed a reported $100 million licensing fee for The Joe Rogan Experience podcast.
Gutierrez did not confirm the $25 million (£18 million) value put on the Archewell Audio deal reported by the British press. “They’re not doing it for free,” he quipped, adding they are “box office” talent whose value is determined by how many people they attract to Spotify. He also compared it to the high prices paid by streaming television services like Netflix to get big celebrities to work on the small screen.
“Those high production shows that tend to be the tentpole that attract people into the service, and therefore benefit everyone,” said Gutierrez. “The product is valued based on how many users it can attract, how many streams it will attract, which in turn determines how many advertisers are willing to advertise on the podcast which determines the economic opportunity, there’s a market that’s emerging for talent in that regard.”
Harry, 36, and Meghan, 39, last week made their split from the royal family official. This week they turned up to plug their podcasts during Spotify’s Stream On event. "We created Archewell Audio to make sure we can elevate voices that maybe aren't being heard and hear people's stories," said Meghan.
Harry added: “And the biggest part of this is trying to create this community of where you can share. We encourage everybody else to then share their own vulnerabilities within that safe space.”