Amidst the Voltair madness last week, you may have missed the second biggest story in radio. It was about radio getting serious about podcasts and on-demand radio, and it’s an important one. Because if “Voltair” is the word of the year in radio, “podcast” has to be a close second.
In case you missed it, the venerable E.W. Scripps Company acquired Midroll Media, an L.A. based company that produces podcasts and oversees an ad network that generates revenue from them.
The interesting part of this story is that Scripps hasn’t been in radio and media for a frappuccino or two. They’re a 137 year-old company that got its start when E.W. Scripps raised $10,000 to start The Penny Press in Cleveland, Ohio in 1878,
Now this historic media company is making history in 2015 by acquiring a five year-old startup, signaling that broadcasters are looking down the road and seeing a path for podcasting success. As visionary as Scripps was back in the late 19th century, Adam Symson – their chief digital office – sees incredible potential in the podcasting space today.
With this acquisition, Scripps is sending out important messages to its stockholders, its clients and other broadcasters.
First, podcasting is already generating significant revenue, and will continue to do so. Symson notes the audience for podcasts is both affluent and “rabid,” a good combination.
Second, live reads by trusted podcasters are the optimal way to connect advertisers and marketers to these podcast content creators. Quoted in an article written by Michael Depp for Net News Check, Midroll CEO Adam Sachs explains how this ad platform is his company’s secret sauce: “Part of that high-touch nature is the implicit endorsement that comes with the host-read ads.”
Third, podcasting thrives on big names, and Midroll brings a number of them to Scripps. They include Marc Maron and Neil deGrasse Tyson, driving CPMs of $100, according to the Net News Check story. These podcasts are franchises, driving revenue and aggregating loyal audiences of habituated listeners.
Fourth, broadcasters have the ability to create and produce great podcasts of their own. Symson notes, “Across the markets that Scripps owns, we have some incredibly talented radio personalities, and frankly, there are some incredibly talented people on the television side as well. These people have developed loyal, even cult-like audiences in a local market, and the only thing that has kept them from expanding that personal brand or product has been the terrestrial radio signal or television signal that doesn’t extend beyond that.” Scripps believes that with Midroll’s structure, backend, and podcast roster, combined with their own personalities, there’s a huge “there there” for podcasting as a space that generate that highly sought after non-spot revenue.
And finally, partnerships are becoming an increasingly smart way for traditional media outlets to achieve growth and diversity, helping to assure that Scripps will be around for another century. Scripps’ CEO, Rich Boehne, says that more acquisitions are likely: “Even after the deal we’ve just completed, we have a very healthy balance sheet, so we continue to look for opportunities both in new marketplaces and also in television.”
This effort to bring in new thinking and practices, combined with traditional broadcasting assets, is emblematic of how traditional media companies can thrive, grow, and leverage their assets. Repurposing radio content and using key personalities to create new podcasts goes to the heart of revitalizing the medium. It’s a great example of a legacy media company having the recognition and vision to pursue a potentially big opportunity that could change the business, and add much-needed cachet and revenue to the bottom line.
And at those podcasting CPMs, Edward W. Scripps would be happy to know his legacy is producing more than just pretty pennies.
Jacobs Media has consistently walked the walk in the digital space, providing insights and guidance through its well-read national Techsurveys.
In 2008, jacapps was launched - a mobile apps company that has designed and built more than 1,300 apps for both the Apple and Android platforms. In 2013, the DASH Conference was created - a mashup of radio and automotive, designed to foster better understanding of the "connected car" and its impact.
Along with providing the creative and intellectual direction for the company, Fred consults many of Jacobs Media's commercial and public radio clients, in addition to media brands looking to thrive in the rapidly changing tech environment.
Fred was inducted into the Radio Hall of Fame in 2018.
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This is at the very least a savvy business decision and possibly a blueprint for what broadcast companies should be doing. Scripps ringing Midroll into the fold is a move I’d expect from one of the major players in social media. When they see a smaller competitor that either does something better or provides a service that dovetails with what they do that company is purchased and the tech/services become part of Facebook, Twitter, etc. It’s a great way to grow without creating a valuable product from scratch.
Thanks for highlighting this acquisition Fred.
Thanks, Sean. There’s a lot to like about the Scripps plan, leveraging their heritage but also depending on smart partnerships. Appreciate the comments and thanks for reading our blog.