The Future of Podcast Mega-Deals
Flashy Pixels Issue 17: Alex Cooper's $100 Million Gamble to Keep Podcasting's Big Money Era Alive
The podcasting industry is facing a pivotal moment as several high-profile talent deals are expiring this year. The outcome of these contract renewals will be a crucial test of market confidence in the podcasting industry. Alex Cooper's hit podcast, Call Her Daddy, is among the most anticipated renewals. In 2021, Cooper signed a landmark $60 million exclusive deal with Spotify, the second-largest after Joe Rogan's. Cooper's deal was central to Spotify's ambitious strategy to extend its dominance beyond music streaming and become the leading player in the podcasting industry. The results of these contract renewals will reveal the podcasting industry's current health and potential future trajectory.
The need to increase profits beyond the slim margins of music streaming drove Spotify to push for original content. The company aimed to become the premier platform for all audio content, including podcasts. Alex Cooper's lucrative deal with Spotify sparked a series of similar agreements, attracting high-profile celebrities like Barack Obama, Meghan Markle, and Kim Kardashian to sign exclusive podcasting contracts. Spotify's billion-dollar investment in exclusive podcast deals transformed an industry previously characterized by small-scale ventures and host-read advertisements. However, some high-profile celebrity partnerships were short-lived, with the Obamas parting ways with Spotify in 2022 and Harry and Meghan Markle following suit in 2023 amid reports of disappointing listenership and insufficient content production.
Many industry experts expressed skepticism about these deals. Dylan Byers from NBC News commented, "Spotify's 2021 podcast talent acquisition spree grabbed headlines but highlighted the risks of overestimating the draw of big names without a clear return on investment."
Podcasts, a portmanteau coined in 2004, gained mainstream traction in 2014 due to the popularity of smartphones and the true-crime podcast Serial, which captivated listeners and sparked a surge in the medium's popularity. By 2018, most publishers had ventured into podcasting. Barstool Sports, seeking to attract female listeners, acquired Alex Cooper's and Sofia Franklyn's Call Her Daddy podcast. The show, which provided candid advice on dating and sex, rapidly gained popularity. However, Franklyn left the show after a public dispute with Barstool Sports, leaving Cooper as the sole host. This dispute also resulted in Cooper obtaining the rights to the podcast's name, paving the way for her to accept a $60 million exclusive contract with Spotify in 2021. Alex Cooper's Call Her Daddy remains one of the top podcasts on Spotify, second only to Joe Rogan's show.
Call Her Daddy has become a popular stop on celebrity publicity tours, mainly due to Alex Cooper's talent for creating viral moments by getting tight-lipped celebrities to reveal information. Notable moments include Zayn Malik discussing his tumultuous exit from One Direction and Gwyneth Paltrow discussing the love-making styles of her famous ex-boyfriends, describing Ben Affleck as more technical and Brad Pitt as more passionate.
As a free agent once more, Cooper is seeking a $100 million contract for her next venture. She recently told the Wall Street Journal, “Everyone has put their offers in, and now we’re all going back and forth, trying to decide which is going to be the best place.” Her ambition underscores her enduring popularity and influence in podcasting, even as the industry has retrenched from the fun-money days of 2021. As this new landscape takes shape, industry giants like Amazon and Spotify are faced with a pivotal question: will they continue to dole out eye-popping, mega-million-dollar deals? The outcome of Cooper's negotiations will serve as a litmus test, revealing whether such lucrative contracts can still thrive in the current market reality.
NBC Executive Producer Molly Solomon called Alex Cooper "this generation's Oprah Winfrey." We will soon see if Cooper shares Winfrey's knack for negotiating her way to billions.