Spotify is undertaking a “strategic realignment” of its podcast division, laying off about 200 staffers.
Sahar Elhabashi, Spotify’s VP, head of podcast business, announced the job cuts in a memo to employees Monday that was shared publicly. The 200 employees represent about 2% of the audio streamer’s worldwide workforce.
The layoffs in the podcast group come after Spotify cut 6% of its overall headcount earlier this year and saw the exit of Dawn Ostroff, chief content and advertising business officer, who previously headed Spotify’s podcast business
“We are expanding our partnership efforts with leading podcasters from across the globe with a tailored approach optimized for each show and creator,” Elhabashi wrote in the memo. “This fundamental pivot from a more uniform proposition will allow us to support the creator community better. However, doing so requires adapting; over the past few months, our senior leadership team has worked closely with HR to determine the optimal organization for this next chapter. As a result, we have made the difficult but necessary decision to make a strategic realignment of our group and reduce our global podcast vertical and other functions by approximately 200 people, or 2% of Spotify’s workforce.”
Even with the cuts and a stepped-up focus on creators, Elhabashi said, Spotify “remain[s] committed to original programming.” With the reorganization, Spotify will merge its Parcast and Gimlet groups into a “renewed Spotify Studios operation” that will produce originals including “Stolen,” “The Journal,” “Science Vs,” “Heavyweight,” “Serial Killers” and “Conspiracy Theories.” The Ringer, headed by Bill Simmons, will remain separate and continue producing programming across sports, culture and tech.
Last fall, Spotify canceled 11 podcast shows, pruning the originals lineup to weed out what the company determined were underperforming titles.
Elhabashi, who joined the company in 2018, reports to Spotify co-president Alex Norström following Ostroff’s departure. Julie McNamara, VP, head of global podcast studios, will continue to oversee the Spotify Studios organization, with Liliana Kim in charge of current content for Spotify Studios alongside Liz Gateley, who will be head of development.
Bill Simmons will continue as managing director of The Ringer -- which Spotify acquired in early 2020 -- and head of podcast innovation and monetization. In addition, Elhabashi said, Spotify will continue to expand its teams that support podcast creator partnerships under Bryan Thoensen, head of content partnerships, "as we increase our focus on the millions of creators building audiences and businesses on our platform."
In disclosing the news about Spotify's latest layoffs, Elhabashi also touted the company's position in the podcasting space. Spotify is the most-used audio podcast platform in most areas of the world, she claimed, and is the No. 1 podcast publisher in the U.S. based on reach (according to data from Edison Research). Overall, Spotify has more than 100 million podcast listeners; the amount of podcast titles on the platform has increased from 200,000 titles in 2019 to more than 5 million today.
The next phase of Spotify's podcast strategy "is focused on delivering even more value for creators (and users!)," Elhabashi wrote in the memo. That starts with "maximizing consumption from the massive audience we’ve established through format innovation and ensuring that more creators in more places achieve success. Simultaneously, in collaboration with the podcasting community, we are broadening our analytics capabilities by expanding Spotify For Podcasters, which will help creators maximize their audience on Spotify and beyond."
In addition, Elhabashi said, "Underpinning this effort is a continued leveling up of our advertising offerings and the introduction of more business models to help more creators make meaningful money from their work."
VIP+ Analysis: Why Spotify’s Podcast Backoff Is the Right Move
