Spotify to Buy Company to Expand Its Podcast Business

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Category: Business

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Unlocking Word Meanings

Read the following words/expressions found in today’s article.

  1. monetize / ˈmɒn ɪˌtaɪz / (v) – to earn money from something
    Example:

    I monetized my blog, so now I’m earning money every time a user reads my content on the website.


  2. make up / meɪk ʌp / (phrasal) – to be a part of a whole
    Example:

    Foreigners make up the largest percentage of tourists in the country.


  3. pay off / peɪ ɔf / (phrasal) – to get good results
    Example:

    In the end, all my hard work paid off. I’m now a licensed nurse!


  4. arsenal / ˈɑr sə nl / (n) – a collection or group of things that can be used
    Example:

    The shop has an arsenal of wedding dresses that brides can try on.


  5. optimistic / ˌɒp təˈmɪs tɪk / (adj) – believing that something positive will happen in the future
    Example:

    I’m optimistic I’ll be able to sell all my products at the fair.


Article

Read the text below.

Music streaming service Spotify is set to buy Megaphone, a podcast publishing and advertising platform.


The acquisition, which is worth $235 million, is Spotify’s most ambitious deal to date. Since last year, the company has spent millions of dollars expanding into the podcast production market.


Currently, Spotify is using Megaphone’s hosting services. The streaming company is buying Megaphone to use its advertising expertise. The audio streaming company plans to create targeted ads. It also aims to make ad monitoring tools available to third-party podcast creators, allowing them to monetize and earn more from their shows.


According to Spotify, podcast advertising has the potential to become big despite only making up a small amount of the company’s current revenue. So far, Spotify’s venture into podcasts and advertising has paid off. During 2020’s third quarter, 22% of the company’s monthly average users interacted with podcasts. Additionally, Spotify now has more than 1.9 million podcasts that feature topics like education and sports.


With Spotify’s acquisition of Megaphone, the audio streaming company now has an arsenal of podcast-related software and millions of podcast titles. Paul Vogel, Spotify’s chief financial officer, is optimistic that buying Megaphone will help the business grow.


Viewpoint Discussion

Enjoy a discussion with your tutor.

Discussion A

• Do you think Spotify’s investment in podcast technologies will be worth it in the long run? Why or why not?
• What other businesses do you think are good to invest in these days? Explain.

Discussion B

• Why do you think some people like to listen to podcasts (e.g. unique content, more convenient than other media)? Discuss.
• If you were to create a podcast, what would it be about and why? Discuss.