Spotify Cuts 17% Workforce, To Support Podcast Monetization In India
The Sweden based global audio streaming service, Spotify, has announced another round of layoffs, affecting about 17% of its workforce. This decision marks the third time this year the company has reduced its staff. Earlier in January, Spotify let go of 6% of its total staff, and in June, they laid off an additional 2%, mainly impacting the podcast division.
The CEO of Spotify, Daniel Ek, outlined this decision in a blog post, calling it a “strategic reorientation.” While the exact number wasn’t specified in the post, it’s estimated that around 1,500 employees will be affected by these layoffs.
Ek explained that despite efforts to reduce costs over the past year, the company’s cost structure remains too high, especially considering the changed economic environment.
In 2020 and 2021, Spotify had expanded its business significantly, investing in employees, content, and marketing, fueled by affordable financing. However, with changing market conditions, the company now finds it necessary to downsize to focus on profitability.
In a related move, Spotify is also canceling two of its popular podcasts, ‘Heavyweight’ and ‘Stolen,’ both produced by Gimlet. The current seasons of these shows will be their last under Spotify.
Rosa Oh, a Spotify spokesperson, praised the team’s work on ‘Heavyweight’ and hinted at potential future collaborations with the show’s creator. ‘Stolen,’ similarly, will conclude its current season, with possibilities of exploring new opportunities elsewhere.
While these cancellations and layoffs mark significant changes, Spotify is also launching an initiative to support podcast monetization in India.
The company has introduced the Spotify Audience Network, which aims to help podcast creators monetize their content through advertising.
This network will allow a variety of advertisers to connect with podcast audiences, with revenue shared with podcast makers to improve content quality. This service is also aimed at enhancing the podcast listening experience for Spotify’s paid subscribers.
Spotify’s entry into podcast advertising in India reflects the country’s growing interest in podcasts. Notably, the Shrimad Bhagavad Gita was the most-streamed podcast on Spotify in India in 2023.
The platform is focusing on capturing this rapidly expanding market by facilitating connections between local advertisers, publishers, and listeners.