Sweden-based Spotify Technology SA has agreed to buy podcast advertising and publishing platform Megaphone, the latest in a set of a deals to improve its podcast platform.
The deal is worth $235 million, a Spotify spokesman said.
The company is going to utilize Megaphone’s technologies to create targeted ads, it stated, and will also make its proprietary advertising monitoring tools accessible to third party podcast publishers.
Spotify, which earns revenue from paid subscriptions and from disseminating advertisements to non-paying users, saw its advertising business return to growth in the third quarter after it had been hit by the pandemic earlier this season.
Executives have stated advertising growth will accelerate from the present quarter.
Its heavy investments in podcasts, in an effort to become the Netflix of audio content, have helped drive subscriber growth in a time when many men and women are homebound as a result of coronavirus outbreak.
Since last year, Spotify has spent hundreds of millions of bucks to purchase companies like Gimlet Media, a podcast manufacturer, and Ringer, the sport and entertainment podcast community based on sports writer Bill Simmons.
The company said the new technology can help podcast publishers get more from their job.
“We are still in the early chapters of the streaming audio industry story, but it is absolutely clear that the potential is significant,” Spotify’s Chief Content & Advertising Business Officer Dawn Ostroff said.
Spotify now has 1.9 million podcasts, up from 1.5 million from the next quarter, boosted by large leaps for example “The Michelle Obama Podcast” and “Mama Knows Best” by ‘influencer’ Addison Rae.
The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Supantha Mukherjee in Stockholm and Ken Li in New York. Editing by Jan Harvey.
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