LiveXLive has made a splash in the podcast industry during the past year with its acquisition of PodcastOne and its rollout of video podcasts or “vodcast” as it has branded them. Podcasts could also play a larger role in its Slacker streaming music service. As post-pandemic America reopens, the company with its foot in live entertainment could play an even larger role as podcasters’ live events head back on the road. Podcast News Daily caught up with LiveXLive CEO Rob Ellin for where he sees things heading in 2021. An edited transcript follows.
PND: It is has been eight months since you closed on the PodcastOne acquisition. How are things going?
Rob Ellin: It’s been spectacular, not surprisingly. [PodcastOne founder] Norm Pattiz is one of the icons in radio and his help across Slacker and PodcastOne is unique, because radio and podcasting have some similarities and share synergies, including hosts, and nobody has got more of the best hosts in the world than radio.
PND: You have also made a lot of other podcast-related deals in the past few months.
Rob Ellin: With our Audio Up partnership, this will be the first time that we are starting to do scripted podcasts and there’s more coming. And you are going to see more of those scripted shows have second windows, from television to film. It again adds to our franchise. We’re also producing our own music. Just think about how hard it is in podcasting, nobody has licenses for music. But Slacker has all the licenses with the record labels and publishers, and the relationships. But even more interesting is if you own and create your own music, and we partnered with Audio Up to create that opportunity. All the music in Valentine’s Day in Hell is ours, curated and created for that podcast, very much like a movie or a television show.
PND: LiveXLive seems to be blurring the lines between audio and video. How does that work?
Rob Ellin: Think about Adam Carolla going from a radio show to a live variety show. We just simply added music to his live event and one million people watched. And the exciting part is the million people that watched, it didn’t affect the audio numbers at all. In fact, the audio numbers were up.
PND: You have a strategic review underway. Is there any update on the process?
Rob Ellin: I can’t go any deeper than to say we have multiple verticals and that each has an opportunity and billions of dollars of value. We have multiple verticals from live streaming, to online radio, to podcasting, to specialty merch and our OTT channel. All of those could be spin-offs, sales or partnerships. We have a fiduciary responsibility to our shareholders to do the right thing for shareholders, so we have to explore all options. But we’re focused on the business day-to-day and let JP Morgan do its job.
PND: When do you hope to have that wrapped up?
Rob Ellin: We haven’t stated that. But the next big chess move within the company will happen shortly. We have done four acquisitions, and the next acquisition, merger or spinoff could happen by March 31. It’s time for our next big chess move.
PND: How do you see the podcast business?
Rob Ellin: If it didn’t get hit by COVID this past year, podcasting would have passed a billion dollars in revenue. In five years, with vodcasting and second windows, it is going to be a $5 to $10 billion industry. Think of the opportunity. We are testing long-term IP that has the opportunity to be video, with all the music inside of it. That has the opportunity to generate brand new revenue.
PND: Does that mean we will see PodcastOne offering subscription podcasts?
Rob Ellin: Indirectly and directly. We are today offering for $4 a month you are getting all the audio you can eat on Slacker, plus 500 curated radio stations, plus all the live events, both audio and video. Now we have just added in podcasting. That’s going to drive more subscribers. And eventually we’re going to have talent that are going to do special items that are going to be pay-per-view events and that drives more subscribers. It is also going to keep your subscribers longer and usage is going to be longer.
PND: So Slacker is how they’ll be distributed?
Rob Ellin: We just passed one million paid subscribers, 2.2 billion downloads of our podcasts, and 2 billion listens on Slacker. You’re going to see a lot more out of Slacker shortly. You’re going to see us talking about those audio chess moves, those differentiators. We’re starting to see Tidal get bought, Deezer just raised a billion dollars, and there’s not going to be anyone independent left who is not inside a multibillion-dollar company, so we are uniquely positioned there, and we’re focused on that lean-back experience.
PND: Merchandising is an area you see helping podcasters make more money too, right?
Rob Ellin: We just launched a merch line with Michael Cohen, who has had more than four million downloads to his podcast. It includes an orange jump suit with his logo on it. And every single one of these podcasters will have an opportunity of owning their own products and utilizing the muscle of not only the distribution of their own podcast but we have the inventory to help them expose it across everybody’s podcast. And we’re already crossing-over our podcasters. We’re unique positioned because we have so much traffic – we have over two billion downloads of our podcasts – and we have an opportunity to use that inventory to build products for those talent.
PND: Is it a traditional revenue split arrangement?
Rob Ellin: Correct. Every deal is different, and it depends on the level of talent and engagement and whether we came up with the product or they already had it. But partnerships usually work out in the 70-30 to 50-50 range.
PND: How do see the future of live events for podcasters, and overall?
Rob Ellin: We have a live business called React that we bought last February, and that was a hardcore learning lesson. We bought a business doing $16 million in revenue and we lost all of that last year. We pivoted, and after streaming 300 artists in 2019, we streamed 1,800 in 2020. As live comes back, we couldn’t be more excited. I think it’s going to be like the roaring 20s. There’s going to be a thirst for live, but the thirst to participate in that live is going to be bigger than ever. Live and digital are coming together.
PND: How about podcaster live events?
Rob Ellin: We are going to see a next generation of podcasters that are going to go from being like a radio host to being a radio and TV host. A lot of talent can’t do that. Some people are just meant for radio or TV and we’re going to find out. Adam Carolla is super-talented and relevant for a long time, and as he comes out his business is going to grow dramatically by giving a video version. We saw that in the first two live events with him, and there will be more to come.
PND: Will all your podcasters need to do video?
Rob Ellin: There is talent that can’t video, they just don’t have that skill. It’s just very different and we’re going to have those hosts that are perfect for podcasts and then we’re going to find out really quickly which ones work.
PND: You recently had an executive change with PodcastOne CEO Peter Morris leaving.
Rob Ellin: He’s a really terrific guy and now he has moved on with his career. I have nothing but good things to say about him. Kit Gray took back his role as President with me as CEO of the overall company. Kit founded the company, he brought Adam Carolla in, he brought Norm Pattiz in, and he’s back in the helm of running it. He is one of the pioneers in the space and he’s done an absolutely terrific job and he’s become a dear friend and terrific partner. And the combination of him and Norm together is a great team.
PND: LiveXLive has grown a lot. Are you still looking at deals?
Rob Ellin: We’re not done with acquisitions, and we’re going to keep building the flywheel. But we’re very careful. A lot of people are taking gambles with venture capital money, and we don’t’ know what is going to work yet. We are being selective, and making sure costs and risk are appropriate.