Is Spotify's Grip Slipping?
Does the controversy with Joe Rogan open the door for other streaming apps?
The relationship between Spotify and podcast giant Joe Rogan has been on shaky ground since the two signed an exclusive multi-year contract in July 2021. With two rounds of substantial blowback, fans of Rogan, the podcast and Spotify users are all assessing their relationship with one another.
The controversy is showcasing a shift in where consumers are choosing to get their audio content, and one company featured on Entrepreneur.com’s Going Public series, TREBEL, may soon rise to prominence.
Rogan undoubtedly has his fans, but his brand saw a significant media hit in early 2022, as old show clips featuring derogatory language coupled with the host's handling of Covid-19 information created two waves of sizable backlash. As fans doubled down, Rogan and Spotify reacted.
Artists including Neil Young, India.Arie and Joni Mitchell pulled their music from the app. Pressure grew until Rogan offered a detailed apology, citing a commitment to feature more balanced guests and conduct better research himself. For their part, Spotify agreed to put Covid-19 advisories into podcasts discussing the topic.
Arie also shined a light on Rogan's past clips using the n-word during segments. Once again, both Rogan fans and detractors came out in force online. In response, Spotify removed 70 past episodes of the show but refused to cancel the program's contract. Rogan offered another video explaining the context of the words used and how past comedians had done similar.
Will the deal continue?
Looking purely at the numbers, it makes sense that both Rogan and Spotify are keeping the relationship alive so far. Despite the negative responses, Spotify is surging. The company closed last year with solid figures, including a Q4 2021 that saw monthly active users increase 18% to 406 million, while premium numbers increased 16% to 180 million during the period. The company's ad revenue grew to record heights, representing 15% of the Q4 revenue. In all, Spotify's total revenue reached $2.88 billion.
Is Spotify in trouble?
The valuable relationship between the two could spell long-term ruin for Spotify if it handles the situation in a way that upsets fans of Rogan and/or its other users. Each group represents large consumer bases with substantial sway.
Will Rogan's fans turn away if he continues to offer apologies and explainers? Will Spotify continue to support the megastar if more controversy arises? We'll have to wait and see as more develops. As of late February 2022, The Joe Rogan Experience remains the top-played podcast in the U.S. Despite the negative news, Spotify's competition has not seen much of a boost in App Store downloads. Still, Rogan's show has mysteriously vanished from the app twice recently, prompting some to speculate that more could be developing.
The ordeal marks the latest in years of consumer frustration as Spotify grows. Could the Rogan controversy couple with other pressing topics, like musician pay shares, to drive listeners to alternatives? Music apps like Trebel could be the beneficiary of the tech defections if they play their cards right, offering fans the user experience and company ethics they seek in a go-to music player.
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