Joe Rogan has just signed a deal to take his talents to Spotify. Most notably, he’s doing so exclusively, which is a massive deal as he’s one of the, if not the, most popular podcast host right now. This is only surprising in that it’s Joe Rogan who has famously eschewed putting his podcast on Spotify to date. But the type of deal shouldn’t be a big surprise. It was inevitable.

And while my title implies a negative tilt, it’s more to denote a watershed moment for the podcasting industry. If it feels like there have been a lot of those over the past couple of years it’s because there have been. And in the past year or so, they’ve predominantly been driven by Spotify.

Gimlet. Anchor.¹ Parcast. The Ringer. Now Rogan. Boom. Boom. Boom. Boom. Boom. Boom.

This last “boom” in bold because it’s the big boom. The obvious comparisons to Howard Stern signing with Sirius over 15 years ago seem apt in the broader importance of the deal. Though the details and ramifications seem far different here.

The open web proponents are already assembling with the pitchforks in Twitter town square. “Podcasting was always supposed to be open! If not a standard, exactly (it’s always just ridden on the rails of RSS), a mentality. And this ruins everything.”

Maybe. Maybe not. Either way, it doesn’t really matter because again, it was always inevitable. Podcasting has been in the process of changing for years. Big, splashy new plays like Luminary get a lot of buzz (and derision), but it’s the established players like Stitcher, Google, and yes, Spotify, which have been slowly but surely shifting the landscape. Yes, Apple, which brought podcasting to the masses, has remained the benevolent ruler for years and years, and that has been great,² but we’ll see what happens now…

The reality is that Spotify has the scale, not to mention the capital to change this industry. Most importantly, they have the desire to do so.

They also seemingly have the need to do so. Everyone knows that music is a tough business to be in. But it becomes decidedly less tough if you have leverage in the form of say, millions of customers who use your service to do something other than listening to music. This plus the leverage of working more directly with artists makes the music business not such a bad business over time, would be my guess.

But it’s hardly just about that. Podcasting is becoming a big business in its own right. Yes, it’s still nascent, but Spotify has been putting the pieces in place to make it less so. And Joe Rogan may be the last piece needed in that equation.

Spotify’s deal to acquire The Ringer was interesting in that the idea was that their popular network of podcasts would still be available elsewhere.³ Others weren’t so sure, but it seemed logical to maintain the status quo because… The likely plan was to use the wide reach of those shows as the scaffolding for a podcast advertising network. What does advertising need to work? Scale. The bigger, the better. That means Spotify plus Apple Podcasts plus Google Podcasts plus Stitcher, etc.

The Rogan deal is almost the exact inverse. They’re not acquiring the man nor his show. It’s an exclusive deal for a set number of years that moves the show entirely onto Spotify, along with a decade-plus archive, after a set period of time. This is less about scale because Rogan already has scale. This would seem to be about leveraging his scale in a few interesting ways.

The first is undoubtedly as a funnel to new Spotify users.⁴ While Spotify goes out of their way to note that the podcast will remain free, this just means that you don’t need to be a Spotify premium user. You will still need a Spotify account. Some percent of users that sign up for Rogan will undoubtedly convert to paid Spotify users, and that’s great. But even if they don’t, they’re now using Spotify as a podcasting app. Which means they’ll most likely be using it to listen to other podcasts as well. (More on this in a bit.)

Again, both of those things mean leverage over the music labels. But they also likely mean even more scale to get a podcasting ad network off the ground.

At first, I thought the most interesting unknown of the Rogan/Spotify terms was around who manages and sells the ad inventory. But my friend John Zeratsky pointed me to the AdAge write-up of the news which notes:

Spotify will begin selling ads in September through a partnership with PMM, which has a long track record of representing Rogan’s ad inventory. Although the show previously only had pre-roll ads, Spotify intends to now include mid-roll ads as well, the company told Ad Age.

There are seemingly still some unknowns here — how does he handle/promote some of the more fringe products which he has a stake in, for example? And at some point does Rogan get fully integrated into a Spotify ad network, when it’s fully baked and rolled out? I suspect there are elements of the deal to make it a hybrid on an on-going basis, but we’ll see.

You’re likely aware that Spotify currently pays almost all of their revenue back to the labels. You may be less aware of the fact that they do this even if users are listening to podcasts and not music. I’m going to go ahead and guess that this starts changing soon. Again, the leverage just landed.

Another interesting dynamic: beyond pure podcasting, Rogan’s show was very popular in video form on YouTube. That ends this year with this deal. But presumably the videos don’t end. That means they’re either used as promotional clips and still shared on YouTube and the like, or they also come over to Spotify. [Update: once again, the AdAge article above comes through to confirm this detail:]

Rogan’s channel on YouTube also saw more than 100 million streams in March alone. By the end of the year, however, all of that content will exclusively live on Spotify’s platform, though some snippets of video will still be featured on YouTube. Spotify also has plans to incorporate a video element of the show, where users can toggle between audio and video through its app, but that feature is currently in testing and not widely available.

You may recall a failed effort by Spotify to launch a streaming video service a few years back. This could be a different, tangential attempt at video. Video pods get almost no love when it comes to press coverage, but they’ve long been a part of the ecosystem. I see no reason why Spotify doesn’t and shouldn’t want to play here as well. And, in fact, per above, they’re already experimenting with it. Rogan just super/turbo/ultra-charged this effort.

This means Spotify now has a free music service, a paid music service, a podcast player, exclusive podcast content, written content (The Ringer’s website) — and perhaps a video service, in the form of video podcasts (at least to start). Oh, and an ad network. The leverage is growing, alongside the market and the userbase.

The next obvious question: how do others react? There have long been whispers and reports of exclusive Apple podcast content. But it was always framed more as promotional for the various other services they sell — Apple Music, or Apple TV+, for example. This may change that equation.⁵

It may also change the equation for Google/YouTube.⁶ Google recently re-launched their podcast service, and as a product, it’s quite good. But it’s similar in nature to Spotify, in that they’re trying to have their own directory. That’s a tough sell unless you have, say, millions of users already using the app as Spotify did. Perhaps Android is the play here, but what if you say, sign a Joe Rogan type to be exclusively on your platform, thus bringing the users in? I have absolutely no inside information here, but if I were them, I would probably look to what Rogan was doing with YouTube (not to mention what YouTube does with music) and square a circle.

Regardless of how it shakes out, it feels like we’re entering a world in which there are different podcast services which have their own different content. Akin to the current streaming TV situation, you may very well need multiple podcast services — and podcast players — to get the content you want.⁷

And as is happening in the game streaming space, exclusive deals to lock talent to various networks may become the norm. While the Howard Stern deal may not have kicked off a bidding war for radio talent, podcasting has enough players now interested and with deep enough pockets that this could play out differently. What if, say, Apple makes a play for Stern himself?! (It’s perhaps not as crazy as it sounds — remember Beats 1? — especially with a contract up soon…)

There have long been fears that music would play out in a similar fashion, with platform exclusives. And while Apple and others dabbled in exclusive windows, the labels were able to keep the status quo intact. That’s not happening with podcasts because there are no labels. The closest thing to an old guard was Apple, and they just got lapped by Spotify while staring off into space. That great big open environment.

You may not like it, I may not like it, but by the end of the year, the podcast landscape is set to look a lot different. An arms race is afoot.⁸ Offer up your best defense. This is the end of podcasting’s innocence.

¹ At the time of the acquisition, I was an investor and on the board of Anchor through GV. That said, I have no knowledge of Spotify’s podcast plans since that deal went down. Alongside my wife, we were also personal investors in Gimlet. Same situation. Unrelated to those two transactions, we hold shares in Spotify — mainly because they seem like a smart, savvy company. See: above.

² Unless you care about innovation, then it has been decidedly less great.

³ For the most part; they have some exclusive shows — including on Luminary.

⁴ As Spotify said in a statement to AdAge: “The comedy talk series has long been the most-searched-for podcast on Spotify and is the leading show on practically every other podcasting platform.” Users will come to Spotify for this show and more importantly, will stay there.

⁵ At the very least, hopefully it forces Apple to take this more seriously. In the era of services, podcasts could be a key part of a bundle… Which is blasphemy to the open web folks, I know. But again, it’s happening.

⁶ Time for the other disclosure: Google/Alphabet is the LP of the fund at which I’m a partner. No, I have no inside information about any of this. Yes, these views are my own.

⁷ With some base level of content — albeit a massive base — likely always available for free on the open web via RSS feeds. But we’ll see how this shifts as well. Maybe even some smaller podcasters align with various networks for monetization and/or distribution. Unclear.

⁸ The last question: why now? Was Rogan being pursued by others? Were Spotify podcast numbers falling in the era of COVID? This is obviously very soon after The Ringer deal, was the plan always to land a marquee name with the opposite type of deal? Again, so soon?