Amazon's Audible Introduces Podcast Subscription Service

Will Cost Non-Members $4.95 a Month for Ad-Free Short-Form Audio

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There are several hundred thousand podcasts available through Apple's podcast app, and all of them cost the same amount: nothing. Starting today, you can have access to a far smaller slate of podcasts for a few bucks a month over at Audible, the audio books service owned by Amazon.

Audible is betting that avid podcast fans will pay $4.95 per month for Channels, an exclusive selection of ad-free original podcasts, comedy performances and audio renditions of written articles. The subscription is free for current Audible members.

While Apple has always loomed large over podcasting, other big companies like Amazon, Google and Spotify are beginning to inch into the space. Channels is Amazon's first major foray into the business and puts it in a position to be both a platform for and creator of new shows.

"They are doing to audio what they did with Prime Video -- it's vertical integration, and it puts them in a position where they can firmly participate in the larger development of culture," said Nick Quah, who writes the podcasting newsletter Hot Pod.

Audible is starting off small but plans to expand quickly. When it launches, Channels will have a collection of sketches of American presidents, a comedy show starring Eugene Mirman and an eight-part scientific and cultural examination of human breasts. Audible has about 40 others in production.

Eric Nuzum, senior vice president for original content development at Audible, described the idea as a response to paralyzing number of choices facing listeners. He critiqued Apple's platform, which has more shows than anyone can listen to and a lack of useful tools to sort through the noise.

"I've heard customers refer to podcasting as a flea market, where you'll find some treasures, and it's surrounded by a lot of junk," he said. "You have to be in the mood to sort through the junk to find the treasure, and people don't want to do that all the time."

Podcasting has existed for years, but it's still a nascent industry. If Audible's subscription service is a success, it would prove that there's a realistic alternative to the ad-supported model that thrives on the Apple platform.

Just over one-third of Americans have ever listened to a podcast, according to Edison Research. Listeners tend to be wealthier and more educated than the general population, and they listen to a lot of shows. The profile mirrors the demographics of subscribers to digital video and music services, and companies are eager to find the best way to take their money.

A lot of people don't think there will be a Netflix of podcasting. Andy Bowers, chief content officer of Slate's Panoply Network, said the best chance for a subscription model to work would be to offer one that offers ad-free versions of many of the most popular podcasts that exist today. "Short of that -- and I don't see anyone doing that at the moment -- I think the ad-supported version is here to stay for a while," he said.

Still, a handful of other podcasting businesses have begun experimenting with paid premium services. Acast, a podcast app, created an option for its podcasters to begin charging for content earlier this year. Midroll Media charges $4.99 a month for a service called Howl that offers access to original shows and archives of popular podcasts like "WTF with Marc Maron."

Audible is loathe to compare itself to other podcasting companies. It won't even use the word "podcast" to describe Channels, preferring to describe the content as short-form audio. Lumping Channels into that cottage industry undersells its ambitions, Mr. Nuzum said: "People haven't wrapped their heads around the scale of what we're doing."

Manolo Espinosa, a former SoundCloud vice president who helped build its podcasting business, said Audible has the potential to make the subscription model work, and everyone in the industry is watching to see what happens. Amazon has expressed an enthusiasm for podcasting that Apple hasn't, even as that company has come to dominate the industry.

Amazon also has nearly unlimited resources, an immense amount of data about how people consume media, and the patience to lose money for years while establishing a new line of business. "They're considered by many folks to be the 800-pound gorilla," said Mr. Espinosa.

-- Bloomberg News

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