The Joe Rogan Experience, America’s most popular podcast, debuts on Spotify.

America’s most popular podcaster has signed a $100m deal with Spotify—what does it mean for Joe Rogan, the company, and the podcasting world as a whole?

For over a decade, former MMA commentator and stand-up comedian Joe Rogan has been one of the most popular podcasters in America. Jumping on the podcast medium early, Rogan’s diverse mix of guests—comedians, academics, entertainers, and political figures—and freewheeling style (episodes often run to three hours) have found him a wide and loyal audience. Yet his decision to sign an exclusive $100m deal with Spotify, which will see “The Joe Rogan Experience” disappear from all other platforms by the end of the year, has raised a number of eyebrows in the podcast and streaming world.

A U.S stand-up comic and former TV host, Rogan launched his podcast in 2009 during the early days of the medium. Last year, his show was downloaded 190m times per month, and the entertainer enjoys 8.42m subscribers to the video version on YouTube. Rogan has been credited as being an “unlikely political influencer” by the New York Times. In January, he informed his followers that he would “probably vote for Bernie,” referring to the then Democratic Party candidate Bernie Sanders, who received increased press coverage as a result. In 2018, the show hit the headlines for all the wrong reasons when the host shared a cannabis joint with Tesla boss Elon Musk, after which the company’s stocks fell by 9%.

Cue Spotify’s interest. The streaming giant clearly sees a profitable future in podcasting as a medium—and hosts with Rogan’s profile as valuable assets.

The numbers

As most podcasts are free to download, many presenters and producers attempt to make money from endorsements and advertising. A platform-exclusive deal like the one Rogan has inked with Spotify is extraordinarily rare.

The kind of figures involved are unprecedented and many analysts believe that Rogan will now likely earn more money from Spotify than most musical artists. According to Tom Gray, director of the royalties, music copyright, and licensing society, PRS for Music, Rogan will effectively earn the equivalent value of over 25 billion streams through the initial licensing agreement alone.

“This is a big deal, and it reflects a couple interesting trends, some old, some new,” said fellow podcaster Scott Galloway, host of the award-winning business podcast Pivot, on his own show on May 22. “The old trend it reflects is that advertising sucks, and anyone with any money is figuring out a way to opt out of advertising.

“If you’re lucky in podcasting, you get ads at a CPM of $20 or $30, meaning that for every thousand people that show up, an advertiser will pay 20 bucks… Rogan was making around $30 million bucks a year, supposedly, and he found somebody who said, ‘Okay, we’re going to liberate your users from this ad-supported ecosystem.’”

“(The show) will remain free and it will be the exact same show,” Rogan said after the Spotify deal was announced. “It’s just a licensing deal, so Spotify won’t have any creative control over the show. They want me to just continue doing it the way I’m doing it right now.”

Yet there has been speculation that while the Joe Rogan Experience will continue to be free, some 1,500 older shows will be behind a paywall to help Spotify generate revenue beyond the extra premium subscribers they are hoping to pull in through the deal. The Joe Rogan Experience will move to Spotify Sept. 1 and be exclusive to the platform by the end of the year.

Spotify had 185,000 podcasts on its platform in 2018; now it has over 1.5 million, but loses nearly 75% of its revenue to royalties paid to record labels. Spotify also signed Michelle Obama and Kim Kardashian West to podcasting deals.

The new radio

For some observers, every podcast in the U.S. Top 100 became an acquirable asset with news of the Rogan-Spotify deal. In such a scenario, big players like Apple, Amazon, and Google will also move to get in on the action. Given the immense popularity of Rogan’s YouTube show, it has also been speculated that Spotify, which until now has only offered audio streaming, could quickly move to video, eventually becoming a serious rival to YouTube.

The evolution makes sense. Whereas other streaming services like Apple and Amazon don’t have to rely on their music platforms for broader profitability, Spotify does—meaning it has to aggressively expand its non-music offerings if it doesn’t want to rely on record companies for revenue forever.

MIDiA Research managing director Mark Mulligan told Rolling Stone that moves like the Rogan deal—which could also potentially expand Spotify’s audience and age reach—may turn the streaming platform into “the single biggest force in audio on the planet the same way Facebook became the single biggest force in social.” In short, a powerful podcasting business could draw new advertising dollars and grab older radio listeners the way music streaming took the younger ones.

If this is Spotify’s plan, the big question is: who will be next on their shopping list?