How Spotify Is Strengthening Our Investment in Podcast Advertising With Acquisition of Megaphone

Less than two years ago, we announced that audio-not just music-would be the future of Spotify. We believe that streaming audio, including music and podcasts, is poised to be the next great frontier for listeners, creators, and advertisers.

That's why today, we're excited to announce Spotify's acquisition of Megaphone, one of the world's leading podcast advertising and publishing platforms.

The acquisition of Megaphone represents the next step in Spotify's expanding the possibilities of this intimate and screenless medium. At the top of the year, we launched Streaming Ad Insertion, an innovative podcast ad technology that delivers the intimacy and quality of traditional podcast ads with the precision and transparency of modern-day digital marketing. The results of Streaming Ad Insertion have been encouraging to say the least and have further validated our commitment to the significant potential of podcast advertising.

So what does Spotify + Megaphone mean for the growth of the podcast industry?

Delivering Scale to Podcast Advertisers Advertisers are ready to realize the full potential of podcasts. The combination of Spotify and Megaphone will allow them to activate across Spotify's Original & Exclusive podcasts while scaling reach through the Megaphone Targeted Marketplace.

Creating Added Value for Podcast Publishers Together, Spotify and Megaphone will offer podcast publishers innovative tools that will help them earn more from their work. This includes the opportunity to opt in to have their content monetized, matching their loyal listeners with even greater demand from advertisers. And we're excited to share that, once we come together, we will soon make Streaming Ad Insertion available to podcast publishers on Megaphone, the first time this technology will be made available to third-parties. That means that podcast publishers will be able to offer more-valuable podcast audiences to advertisers based on confirmed ad impressions (i.e., that their ad was actually heard).

We've already seen our investment in audio pay off. In our Q3 earnings, we announced that 22% of our total monthly average users (MAUs) engaged with podcasts last quarter and that podcast advertising revenue is up nearly 100% year over year. This comes alongside innovations like our first-of-its-kind format for creators to bring together music and talk, and mixed-media playlists like Your Daily Drive. Our podcast catalog now includes over 1.9 million titles that feature storytelling, sports, education, and wellness from diverse voices across the globe, and the world's top creators-from Michelle Obama and Bren Brown to Addison Rae and DC Comics-come to Spotify to connect with their fans and meet new ones.

From groundbreaking authentic voices to can't-miss news and information, podcasting is one of the most exciting mediums of our time. We are excited to collaborate with Megaphone to drive this business forward.

The transaction is subject to customary regulatory review, and it is business as usual until closing.

To learn more, head to the Spotify Advertising blog for a Q&A with Jay Richman, Spotify VP Global Head of Advertising Business, and Megaphone CEO Brendan Monaghan.

LINK:	https://newsroom.spotify.com/2020-11-10/how-spotify-is-strengthening-o...
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