Advertising has been a primary focus for iHeartPodcasts, and it has paid off with $408 million in revenue last year in what the company estimates is a 20% share of the marketplace. But while iHeart has so far not added a subscription feature to its own iHeartRadio app, the company has begun to dip its toe into the revenue stream. It has created an iHeart True Crime+ channel on Apple Podcasts.
For a $3.99 per-month subscription, users get commercial free access to 56 shows as well as exclusive bonus content. “From unsolved murders to missing persons, heists to conspiracies, organized crime to marital infidelity, and everything in between, you’re sure to find something new to binge and share,” its pitch says.
The move into subscriptions by iHeartPodcasts is noteworthy since iHeart CEO Bob Pittman has said in the past he was unsure whether a market had developed for serving a larger number of listeners that would pay a fee rather than sit through commercials. “If it does, we have the biggest library, so it’ll be wonderful for us,” he said at a 2022 investor conference, adding, “I think you really have to keep your eye on the ball as to where do you make money.”
By one measure, the iHeart True Crime+ channel is the second subscriber channel for the company. The Black Effect Podcast Network – which iHeart is a partner in alongside syndicated radio host Charlamagne Tha God – was one of the launch partners with Apple Podcasts when it made the feature available in 2021. But Pittman has long said that advertising is where he believes most of the podcast revenue will come from.
“Listeners want it free and they want the biggest selection they can have, so this model appears to be working,” he said at an investor conference. “I know others are trying this restriction, to charge a premium for something that used to be free. The history of that in marketing is not great.” But Pittman has also left the door open if it does turn out that consumers are willing to fork over money for podcast subscriptions. “Since we've got such a big library, no matter what models emerge, if there's a way for us to make money on it, we've certainly got the content and the promotional power on the monetization engine, which allows us to play there,” he said.
Compared to its big podcast advertising haul, subscriptions revenue will likely be a lot smaller for iHeart. It also must split the proceeds. Apple Podcasts takes a 30% cut of subscription revenue in the first year, with the rate falling back to 15% in subsequent years.
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