technology
Aug 18, 2023 | 12:11pm
Spotify is reportedly missing out on $38 million a year in profits because users can’t stop listening to “white noise” podcasts, which are less profitable for the company.
The “White Noise” podcast, which features calming, relaxing sounds such as the sound of falling rain, crashing waves, or just plain silence, was getting 3 million hours per day on Spotify as of January, according to internal documents. It is said that it is producing a huge amount of consumption time. Bloomberg acquired.
Podcasts are so popular that Spotify has completely eliminated them from its streaming service, preferring users to music by the likes of Drake and Ed Sheeran and other “equivalent shows” that are more cost-effective from a revenue standpoint. It is said that they considered redirecting the .
Spotify’s annual gross profit would increase by an estimated $38 million if the company removed “white noise” from the “talk” section, blocked future uploads, and directed users to other audio content, according to internal analysis. It says.
Ultimately, the company decided not to go through with this move. For now, White Noise will still be available on the platform in podcast format.
“The proposal in question did not materialize and we will continue to offer white noise podcasts on our platform,” a Spotify spokesperson said in a statement.
Bloomberg said podcasts had inadvertently increased at the expense of the company’s profits by promoting “talk (not music) content through Spotify’s own algorithm.” The media previously reported that white noise podcast “hosts” could earn $18,000 per month in advertising revenue.
The Post reached out to Spotify for comment.
Some Spotify users are complaining on Reddit that their favorite white noise podcast isn’t working. Recently “disappeared”.
Spotify shares are up more than 60% since January. Shares are still on the rise this year, despite dismal second-quarter results that fell well short of Wall Street expectations.
The music streamer reported a higher-than-expected net loss of $333.4 million ($1.71 per share). This was up from his loss of $138 million, or 94 cents per share, in the same period last year.
Spotify also worried users in July by announcing plans to raise the monthly subscription fee for its ad-free service by up to $2.
“Market conditions have continued to evolve since we launched. To keep innovating, we are changing our premium pricing in many markets around the world,” the company said in a blog post. “These updates help us continue to deliver value to our fans and artists on our platform.”
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