New Podcast Listeners Are Coming From Radio, Not Music

If the music industry is worried about podcasts eating into music’s share of the American audio diet, new survey data suggests that such worries are unfounded: podcasts’ share increased at the expense of music a couple of years ago but has held steady ever since. Instead, the rising number of podcast listeners are coming from AM/FM radio. That’s what the numbers in new research from Edison Research, Triton Digital, and National Public Radio show.

The Infinite Dial from Edison Research and Triton Digital is an annual survey that has been published for over 20 years. It originally covered listenership to digital radio such as Pandora and Sirius XM, but it has expanded to include other types of streaming music services, social media, podcasting, and most recently e-sports; it has also tracked trends in consumer ownership of devices such as smartphones and smart speakers. The Infinite Dial is highly respected because of its methodological rigor and its year-to-year consistency over a long period of time. The 2020 edition of the Infinite Dial was released last week.

Edison Research also now produces the Spoken Word Audio Report in partnership with NPR. The report, first published last November, is a new piece of research based on a national survey of over three thousand adults who consume some sort of spoken word audio—podcasts, news, sports, audiobooks—on a monthly basis.

The Infinite Dial shows that podcasting has been steadily increasing since 2013. Monthly podcast listenership increased 16% over last year and is now 37% of all Americans ages 12 and up. The increase has been consistent across all age groups.

Yet the amount of time that people spend per week listening to podcasts hasn’t changed—it’s remained flat at around six and a half hours per week since 2018. The Spoken Word Audio Report says that “share of ear”—the percent of audio listening to spoken word content as opposed to music—jumped from 20% to 24% since 2014. However, only a small portion of that 20-24% is podcasts; most of it is AM/FM radio or “Other” (meaning satellite radio, audiobooks, etc.). Podcasts more than doubled since 2014 but they are currently only 17% of all spoken word audio listening. In other words, only 4% of current audio listening is to podcasts.

The data suggests that podcast listening is mostly time taken from AM/FM radio, not digital music. The changes in listening time derive from the sharp rise in the use of smartphones for spoken word audio listening: the Spoken Word Audio Report says that it has doubled over the past five years.

The rise of smart speakers is also playing a role in the increasing popularity of podcasts. Data about smart speaker ownership confirms that much of it is at the expense of AM/FM radio. The Infinite Dial also tracks device ownership; one of the most remarkable statistics from the latest survey is that while smartphone ownership has topped out, smart speaker ownership is rising fast while radio ownership is dropping. Over the past two years, smart speaker ownership has risen 50% while radio ownership has dropped slightly.

Yet listening to radio stations has only dropped slightly over the past few years. Radio still has a huge audience: the Infinite Dial says that AM/FM radio is still the number one audio source in cars by a very wide margin: it’s only dropped from the mid-80% range to the low-80% range over the past several years.

Many people listen to Internet simulcast streams of AM/FM stations on their smartphones or smart speakers, through individual stations’ apps or the two main simulcast apps, iHeartRadio and TuneIn. (If you ask your smart speaker to play a radio station, it will use one of those two apps to play it.) Jacobs Media, a radio industry consulting firm, tracks terrestrial broadcast vs. digital radio listenership; its annual TechSurvey shows that digital radio listenership was 31% of total in 2019, up from 17% in 2014.

In other words, most of the new podcast listenership is coming from AM/FM radio, but AM/FM radio listenership is still so large that the shift to podcasts isn’t making much difference.

This shift has implications for the podcast strategies of major music services, mainly Spotify and iHeartRadio. Spotify has been spending hundreds of millions of dollars on podcast content and production tools over the past couple of years, and it has set a goal of 20% of all listening on its platform being to non-music content. Although the share of podcast listenership relative to music hasn’t changed much since then, Spotify’s popularity as a podcast platform has ballooned: a survey published by MIDiA Research in January, covering the fourth quarter of 2019, shows that Spotify is now a close second to Apple for podcast listenership. Yet there’s no apparent link between Spotify’s investment in podcast content and its increased podcast listenership, since all of Spotify’s podcasts are available everywhere. It will be interesting to see if Spotify starts making all that podcast content it now owns exclusive or offers it for paid licensing to others.

As for iHeartRadio, it has been bulking up on podcast content for years and is now just behind NPR with the second highest aggregate listenership of any podcast publisher. iHeartRadio launches new podcasts on almost a weekly basis. Its podcasts all carry advertising, and generally iHeartRadio treats its podcasts as an extension of its large broadcast radio and syndicated radio show strategy. The company is positioned ideally to take advantage of the spillover in listenership from AM/FM stations on traditional radios to on-demand content on smartphones and smart speakers.

Amid all this growth in podcasting, the other major music service providers aren’t doing much. Apple was reported to be investing in original podcast content last year, but not much has come of that; and its market share as a podcast platform is dropping. Amazon owns Audible, the market-leading audiobook service, but it hasn’t really ventured into podcasting other than to support podcast listening through its smart speakers. As for Google, it just launched a version of its podcast app for iOS, but that’s about it. It’s still not clear whether listenership or revenue numbers justify major investment in podcasting for companies like those that are huge and have diverse revenue streams; but for audio-focused companies like Spotify and iHeartMedia, it seems like an imperative.