Brad: Kerri, thank you for making time to do this.
Kerri: Thank you for your interest.
Brad: You’re the head of PRX, a top 10 American podcast publisher, almost 100 shows. According to Podtrac in January, you served 16 million downloads to about 6 million unique listeners. Congratulations on that.
Kerri: Thank you! We’re really proud of all the shows that we represent.
Brad: I do want to talk about some business specifics in PRX. But first I want to swing over to an essay that you wrote for the Nieman Lab website. It’s a 2022 prediction in which you lay out an aspiration prediction: This is a “radical opportunity to democratize media.” Now, that really got my attention, not only because of its high level of thought and aspiration, but also because I’ve been online for 30 years now and through that whole time, it has seemed to me that the internet is basically a democratizing force. Of course, I recognize that in 2022 we can all point to many ways in which democracy on the internet is broken. But there has been throughout a kind of a disintermediating push, which has given every internet citizen a potentially global reach for personal expression. And that’s good and cool! But I’d love to have you talk about this radical opportunity to democratize media and especially a discussion of your three-part process of how that must happen.
Kerri: Well, thank you for that, and I’ve been thinking a lot about it Yes, one of the things about podcasting in particular is that because it’s audio, it can easily be paired with radio, but it really isn’t. That’s not the right pairing. Their commonality is audio, but really podcasting is much more like the Internet and that open, rich ecosystem. And in every open rich ecosystem, there are dark corners as well. So you’re right, there are prevailing pressures, and they happen all the time, and they happen for Push and Pull reasons. Sometimes pendulums swing. We’ve seen both of these factors. My hope for podcasting is that we learn from other forms of media — particularly other forms of digital media — where we start to lock things off, we close things down, we insert paywalls, information becomes a have-and-have-not dichotomy, and where commercial pressures can either lead to misinformation, which we’ve seen, or just low quality information. And how do we nourish the ecosystem that allows for information to flow freely? Healthy ecosystems need lots of access points and nodes of entry, from the hobbyist podcast to the semi-pro to the institutional builders.
Kerri: Whether it’s public media or any of the other folks out there making excellent, impactful content. And when we start to make for narrow channels, I think that’s where things break down, and so it’s really an invitation for us to put our heads up on a swivel, look around and say, Okay, who’s doing really interesting stuff, how are we making impactful content? And what do we want out of a rich media? How’s the public served, how are listeners served, entertainment, all of it. I really believe that an open ecosystem is richer because of the variety of people who contribute to it. And I worry about this in podcasting because there have been so many acquisitions and so much investment — probably $2.8 billion by my count, you might have a different number, but it’s up there, right?
Brad: I’ll go with your estimate.
Kerri: [chuckle] And so, how does that money get paid back? What’s that return on the investment? Well, a couple of things will happen. One is what we’re seeing now, which is a lot of ad tech, a lot of highways get bought up, everyone’s travelling on their own highways, a lot of technology gets purchased. And then the is the rise of celebrity content, True Crime, that’s how you make inexpensive content in order to reap the benefits and pump up the volume to get that return on investment.
Kerri: And I’m not saying that that’s necessarily problematic. When you have an open ecosystem, those flood gates open up and that’s okay. But where are the guardrails and where are the ways that we protect privacy, that we guard for how we count the metrics? This is how most people make money — that’s what I’m hearing at least from colleagues about Spotify’s purchase of Podsights and Chartable [two days before this interview]. Where are the independent sources to measure an attribution? I don’t know how to answer that — The ink is barely dry on that news! But I think it’s a really good question, and how do we probe at the cottage industry that grows up around podcasting, and make sure that it’s fair and equitable?
Brad: Mm-hm. In that essay and in your thinking, you outline certain phases with which you can reach this highest aspiration of democratization. And the first one you mentioned is “rebellion.” That’s very interesting. Would you say that podcasting, at its roots, say in 2005, was a kind of a rebellion?
Kerri: Totally. Totally. And I love those roots, actually. I think they really inspire innovation, they inspire conversations, they inspire a kind of a carefree attitude of experimentation. And I think that’s healthy. But in the last five years, the industry has matured substantially. The rebellion really does also lead to this moment. And I think we’re in it, which is where people have a little bit of nostalgia for those days: “Oh, I remember when we could all sit around a table. I remember when we used to be able to call up anybody and say, How do you figure this out? How do you figure that out? I’ve got this really great new show.” That’s much, much harder, if not impossible now. But also, there are more people and there are more access points. So that’s the positive part of that maturity point.
Brad: Was the launch of Serial the inflection point?
Kerri: The perfect storm of Serial and Apple Podcast app being on the home screen is really the significant driver. Great content drives many, many things, but you have to have frictionless technology to be that accelerant, to be that enabling factor.
Brad: All right. So that’s the rebellion part. And then as your second phase on the way to democratization, you talk about “dissatisfaction.” And this I take to mean pointing out issues and problems, as you’ve started doing. And I made a list of the ones that you cite in that essay. I wonder if you could talk about some of them. The first dissatisfaction is “Big media underwriting revenue models.”
Kerri: Yeah. And the wave of paywalls. I understand it, and I understand the benefits of it, and I understand the currency and the transaction that listeners may want for something — some privilege in return. That makes good sense to me. But it does interrupt the economy substantially. Eventually, some things are over-paid for, and so it distorts the value. And the frenzy of acquisition headlines can create a false narrative that if you aren’t a millionaire yet, you’re somehow not successful. That’s not accurate at all! You and I know well that the content acquisitions in podcasting we could name are not as significant as all of the money that’s going to big companies and to technology. So the disruption of the economy is both at the consumer level of choice — what’s exclusive on this, what’s exclusive on that? That is disruptive. What am I transacting here? Is it access to some privilege like ad-free content or something, or a bonus content or something? And what does it do to the ad model that has mostly driven the industry? And ad revenue is not going down, still, that’s really the main driver. That’s for sure.
Brad: And just to interrupt for a sec. Are you really talking about two levels of this phenomenon, one being big media organizations acquiring content for hundreds of millions of dollars, and on the other hand, individual podcasters and podcast networks establishing Apple subscription services, for example?
Kerri: Right, absolutely. And what are the subscriptions at the individual show level? Patreon, Apple, a couple of the other subscription services that have come out. What are at the platform level? The best examples would be Audible, Spotify, etcetera.
Brad: Yes.
Kerri: An how do consumers know, and how do they make their way, and what do they have access to, and what do they not have access to? It’s every publisher’s right to decide where they want to be, for sure. But I do think that there’s a healthy skepticism and a healthy conversation we should have. Once things are exclusive on a platform, are they actually podcasts anymore? I mean, by definition, probably not. They’re just in a different industry. It’s just different.
Brad: So it’s all audio, but podcasting has particular characteristics. Does PRX have any Apple subscription packages?
Kerri: We do. We have four channels. And one of the things I like about the way that Apple went about their product is that it’s non-exclusive. We didn’t have to come to that decision: Should it be on Apple and not available anywhere else? They didn’t put that hurdle in our way so we were happy. And there’s a whole bunch of listeners who are happy to participate in channels for bonus content, for ad-free content. It’s a small sliver of our overall audience, but a growing one.
Brad:. Let’s move to another one of these “dissatisfactions.” And this is more technical. It’s about data, and here are your words: “Effective data use favors highly capitalized privacy-averse companies.” Could you please unpack that?
Kerri: [chuckle] It is a mouthful, hearing it back to me. I think this is one of those things that I was mentioning earlier. What can we learn from other industries that have commercialized very rapidly: Video, other internet businesses, etcetera? And privacy is one of those things that’s traded quickly in a technology, and we really believe that… Well, not only do we believe that the privacy laws that have now taken hold in Europe will eventually come to United States, so we believe that there’s good to be had there, but also we think that one can be successful in advertising without compromising privacy. I mean access to technology that can make that decision is a hurdle in and of itself, so how do new independent shows, for example, have access to expensive state of the art ad technology, if they care about privacy? Well, that’s a hard choice to make, it’s a lot of choices that have to go into play there. If there were standards that protected privacy, that lowered that access point — that’s kind of where we stand on it, and we believe that publishers can be successful and use an opt-in strategy for privacy issues. Libsyn does too. The team at Libsyn is strong in privacy support.
Brad: Now, some people listening to this might be thinking: Hasn’t the boat left the dock on this? When it comes to internet media privacy is already in tatters, some people might say. How can and should podcasting be exempt?
Kerri: I think that in the scheme of media, podcasting is still a toddler, so we actually have some choices to make and some opportunities to do the right thing. The alternative is that we are going to see stricter laws like GDPR. Maybe some states will make stricter laws than other states — and actually that’s a real nightmare for technologists to work around and follow compliance this way and that way. I think that it’s a benefit to all of us if we have clear standards and operate by the same rules and guardrails, and that we be “privacy first.” It increases trust with the audience. There isn’t a lot of evidence that by violating people’s privacy, it turns into more product sales. There isn’t a ton of evidence for that! It’s a narrative that we tell ourselves, the more you know about somebody, the more you can serve their needs, but not if they don’t want you to. It’s really complicated, and I’m aware and you’re aware too, like every time you go on the Internet, there’s certain ads that you get served, you’re like, “Hey, how did that get to me?” [chuckle] And there are other times you’re like, “Oh, that’s exactly what I need.” It’s really complicated, but I believe that we should put the listener in the driver seat of that choice. There’s ample evidence of this not going well. I mean, just think about a company like Facebook, their credibility has been really hurt over the last couple of years because of really excessive privacy violations.
Brad: All right, one more “dissatisfaction.” You wrote, “Millionaire culture in media favors the already successful.”
Kerri: Yeah. The acquisitions that are happening now are really some amazing talented shows, without a doubt, but they already have big audiences — it’s really an acquisition of a great audience and an audience that you can build other revenue on. It doesn’t favor newcomers, it doesn’t favor up-and-coming talent, so we really have to think hard about the young-ness of the industry, and how diverse the industry is. Where do investments get made in the next generation of talent that’s going to come our way and delight us with stories? I feel this a lot because as a non-profit organization, PRX integrates lots of shows…
Brad: Yes, I was going to bring that up.
Kerri: I’m really proud of it, actually. We really believe in the independence of shows, so when they’re successful, that’s a real feather in our cap. We’re so proud of them, because part of our model is to help them be successful on their own terms, and so we celebrate those moments. But I’m also well aware that the non-profit sector that I occupy isn’t nourished with much of that capital that comes back in, so it’s an extraction model. How do we flip that so that there’s an investment? Imagine, if the big companies in podcasting donated to organizations that actually are building new pipelines of content. Imagine that we could change that model a bit. That would be exciting to me And then those talented [creators] make their choices about whether they want to be exclusive here, exclusive there, but some recognition that it all starts somewhere. And we’re not the only group that really fosters independent talent. There are lots of organizations that do that and really support people along the way, so I generally want to figure out how to create models that enrich and invest as opposed to extract.
Brad: Well, I didn’t call this aspirational for nothing. What you’re describing is common to all of media really, which is that most of the money flows upward into the rich top of the pyramid. So it seems natural that as podcast matures as a category, it begins to follow that trend as well. But your other point, which is that PRX “walks the talk” is very good. Tell me something about your more recent efforts to foster talent to educate podcasters, because really the PRX brand is known for that.
Kerri: One of the things we have started over the last five years or so is a great partnership with Google to do a global training program. That’s an accelerator program. It’s competitive. We open up the doors and we get applications for a certain number of slots, and we run it like an accelerator program over 16 weeks. We’ve done a number of these trainings. One of the great things about giving ourselves 16 weeks as opposed to a two-week training, is it really gets to the opportunity to make something, and get feedback, and it favors the way adults learn.
Kerri: One of the things I’m most proud of in this training program is that 100% of the folks that have gone through the training are still making their podcasts! Those are great odds, that’s incredible odds. Now, are they small? Are they wildly successful? These are early days; this is where we plant seeds. But that gives us an indication at PRX that the training we’re doing is sticky, that it’s working. And again, it’s on their terms. We’re really proud of that. And we have two Podcast Garages, so that gives us a place to be in-person … so come in and take a workshop, meet other people, there’s a real community for peer-to-peer learning as well.
Kerri: A couple of years ago we started an online training program. We’re going to dust that off because there’s something needed in between. Maybe not everybody can do a 16-week program, and not everybody can walk into a podcast garage. What’s in the middle there? What would be unique about the way that PRX can offer that training? There’s a lot of amazing trainings out there. One of the ways I think that PRX is unique is that we are really well-versed in a “design thinking” methodology of training, and we uniquely make technology, so I really believe that up-and-coming podcasters need to be pretty well versed in how the technology works, or they’ll make a lot of terrible decisions along the way. Wo fluency around monetization and technology is how we can help people be successful.
Brad: Let’s swing over to other business questions about PRX. You have a mix, I think, of home produced, owned-and-operated podcasts, and distribution deals with other small networks and podcasts. Tell me about the distribution side of it, what kind of agreement is made there?
Kerri: Sure, our distribution is really the oldest part of our company, and it started out distributing shows on public radio. The way PRX started was to create an open marketplace to do that. Reducing friction and encouraging those who were making evergreen radio to upload. And so that public radio stations could find them. That gave us a front row seat to independence as they moved into podcasting. Over time we became a taste maker, and we started to invest in great one-off shows that we thought could be series. The MFA’s a really good example of that, which was a live show in two cities in those early days.
Kerri: Distribution is still really the majority of the relationships we have. We are a B2B company in many ways, and we help with monetization, technology support, marketing. About a year and a half ago we created our own production unit. I like to say that the reason we did this is so that we could stop saying “No” so many times when we were asked to make things, to do things, to be a co-producer. We’ve always been a co-producer on many things, but we started a production unit, and it’s been super successful…
Brad: This different from Radiotopia?
Kerri: It’s different from Radiotopia. Radiotopia is really a curated aspect of our distribution arrangements, and it’s intended to be small and select, but it’s a sub-brand really of PRX. So Radiotopia — I’ve thought about this many times over the years, because we never thought it was going to be as successful as it was. At the time when we founded Radiotopia, most podcast networks were topically aligned, like comedy or how stuff works. And our connection with the Radiotopia shows was really just creativity. We thought that was too loose, quite honestly, but it has become one of the most important aspects of the brand. We just double down on creativity, and we’re very selective about Radiotopia. We do a lot of things together, so we intentionally keep it very small, but it means that we can have a great variety in there too.
Brad: Let me grab a couple of examples from my possibly faltering memory, I think you’ve done distribution with Magnificent Noise, Eric Nuzum’s group, and maybe with WaitWhat too… Am I remembering that correctly?
Kerri: That’s correct.
Brad: With those deals and arrangements like them, do you then take on the monetization?
Kerri: We do. Magnificent Noise is a really great example. They make so much great content, and they make content for others, so they’re a work for hire. They also have a growing roster of original shows, so then they have to decide — well, okay, now that we’re doing all these original shows, do we make it exclusive on a platform, or do we make it in the open ecosystem wherewe own all the IP and we help monetize it? That’s where we come in. We partnered with Eric and we support all of the shows technically, we help monetize, we help promote and market, and he does that himself as well. Many things that are shared — marketing would be a great example of that. Eric, I think you know this too, he’s such a great promoter of excellent work.
Brad: Yes he is.
Kerri: And WaitWhat is the same — we help them with monetizing one of their shows, but they also have a sales team, so we do some co-selling as well. One of the things about being a creator first, mostly a B2B operation, is that we are able to contort ourselves, if you will, onto what the needs are of the people we work with. Sometimes that’s a big slate of things, and sometimes it’s a smaller slate of things. We have lots of folks who use us just for technology only, but we really have a pretty full menu of how we can support shows, depending on where they are on their trajectory of success.
Brad: When you’re involved in the monetization, do you have a sales staff or is that outsourced?
Kerri: We partner with an organization called Market Ingenuity…
Brad: Oh, Harry Clark.
Kerri: Exactly. And they have been great partners. We think of them as in-sourced a little bit. We work close enough so that they’re really an extension of us and we’re an extension of them, so we partner quite closely on how we do the direct sales. We do other forms of monetization. As you mentioned earlier, we also support the Apple Podcast, we do all of that uploading and metadata, all of the stuff to support the success on Apple Podcast. We have a micro-fundraising operation that we manage for a couple of our shows. We always keep on the lookout for ways to creatively monetize shows. This is an industry that is shifting, and so we try not to over-index on our cookie cutters. We try to be experimental, and now we’re seeing a whole slate of newcomers. They start with subscription. That’s totally new to me.
Brad: That’s interesting, isn’t it? And you can understand why. You get control over your earnings.
Kerri: Totally. And it takes a long time for ad revenue to kick in, really. It’s always audience first, money second. So it takes a long time for these channels and the audience to mature to a point where you really can leverage the advertising dollars. So it makes sense to me. This goes back to your other question — How do we capitalize new talent? How do we capitalize risk? And one of the other things that has happened a lot in the last couple of years is we’re seeing the rise of the six-episode show.
Brad: Yes!
Kerri: That’s super hard for our business, right? We’re in the marathon business, and sometimes we’re sprinting that marathon, but we’re in the marathon business, nonetheless. And media is habit, and we are always grateful to work with awesome audio — even if it is only six or eight episodes. But normally we have to look for funding before we can support that, because the math just doesn’t add up. It’s really hard to monetize with ad-support unless you have something ongoing.
Brad: “Media is habit.” I love that.
Kerri: Media is habit.
Brad: I’ve said that for years. I ran some editorial operations for AOL years ago, and I would tell the managing editors of those groups, “You’re not in the content business. You’re not in the advertising business. You’re in the habit business.”
Kerri: That’s true. And some of the VC-funded companies, they can invest in those six- and eight-episode things because the return is measured differently. They can put a different value on it. But supporting the independents with an ad model, that’s really hard. We think very hard about those short run mini-series. Our success is really in ongoing shows, ongoing listener basis. Advice I give to public radio stations all the time is maybe try a project or two, if it’s really core to the journalistic objectives you have, and the impact objectives you have. But know that it won’t pay for itself. [chuckle]
Brad: If I ask you about revenue and CPMs, will you hang up on me? [chuckle]
Kerri: [laughter] No not at all. Not at all. [laughter] Fire away.
Brad: Alright, how much?
Kerri: Well, we earn about $22-$24 million a year in ad revenue, that’s across a lot of shows, a variety of shows. So you’ve had some that are weekly, you get some that are bi-weekly, some that are daily. We’ve got a whole mix. We’re proud of that mix. The thing about PRX that is meaningful to me is we’re brokering those transactions, so most of that money goes into the hands of the creators. In that way we’re investing ourselves — in the monetization of that content and those independently owned shows. And I like knowing that that’s not to three shows, it’s to hundreds. Over the years, of course, it’s thousands of producers who have constant monetization from their efforts and what they do.
Brad: Well, this brings our conversation to a reluctant close. It’s lovely talking with you again.
Kerri: It’s nice to talk with you. Thank you.
Brad: As we were saying before we started recording, it’s been two or three years since everything went indoors into our homes. Thank you for making time.
Kerri: Thank you, Brad. Thank you for your interest, and I’m so glad that you’re doing this series. I’ve really enjoyed the ones I’ve listened to so far.
Brad: Thank you! See you soon, I hope.