On Monday, Spotify, the audio streaming platform, announced that it would be laying off approximately 200 employees, including staff from podcast studios Gimlet Media and Parcast. The podcast division would be undergoing a “strategic realignment,” according to Sahar Elhabashi, the head of podcasts at Spotify.
Since early 2019, the number of podcast shows on Spotify has grown exponentially. The podcasting industry has seen a rise in production with media companies investing heavily to expand their offerings. But investment in the podcasting industry has been slowing down, which explains the recent actions of companies cutting podcast jobs and curtailing budgets.
The layoffs at Gimlet and Parcast are aimed at providing more options for podcast creators. As part of the reorganization, Spotify Studios will absorb Gimlet and Parcast. Gimlet, known for its podcasts such as “Reply All” and “Heavyweight,” had issues with its workplace culture earlier this year, leading to the cancellation of “Reply All” in 2021. Parcast, which produces true-crime shows like “Disappearances” and “Dare to Lead,” hosted by Brené Brown, is another studio absorbed by Spotify.
However, Gimlet and Parcast’s unions have criticized Spotify’s handling of its acquisition of the studios. The companies “wasted that opportunity” and canceled shows with loyal audiences, according to a statement released by the unions. Other companies, including Vox Media and Pushkin Industries, have also announced layoffs this year, with Amazon, SiriusXM, and NPR cutting their podcast budgets in the past year.
Despite these obstacles, Elhabashi is optimistic. She says that the success of Spotify in growing the podcast ecosystem depends on a machine “always in motion,” and the restructuring will result in strong discovery and podcast habits for users, thriving monetization and audience growth for creators, and a valuable, high-margin business for Spotify. Podcast downloads saw a 20% increase in 2022 compared to the previous year, according to a report by Triton Digital, an audio audience measuring company.
Other media companies have also announced layoffs in the podcasting industry, including Vox Media and Pushkin Industries. Amazon, SiriusXM, and NPR have also cut their podcast budgets in the past year. In October 2022, Spotify laid off dozens of podcast workers at Gimlet and Parcast, and in January announced that it would be laying off approximately 600 employees.