Castbox thinks paid service is the future of podcasts.
For now, audio advertisements have been one of the biggest sources of income for podcast companies, but in the future, premium paid content will surpass ads and become significant, said Renee Wang, founder of the podcast platform, at TechCrunch Hangzhou on July 3.
Although the company is based in San Fransisco, the majority of Castbox’s staff are in Beijing. It has raised a total of $29.5 million since its founding in 2016. Its proprietary technology includes features like curated podcast recommendations and in-audio deep search. It offers paid podcast shows and recently announced a blockchain-based payment solution.
China is taking the lead in paid content while the US lags a bit behind, said Wang. She said it’s not that American companies don’t want to charge podcast listeners, but they are not fast enough to develop the paywall technically.
The confidence Wang has in paid audio shows comes from growing Chinese podcast platforms like Ximalaya (喜马拉雅), Qingting (蜻蜓) and Dedao (得到), three of which she mentioned multiple times during the interview. Instead of being production companies themselves, these companies are focusing on content distribution and sales promotion. During Ximalaya’s 3-day 123 Shopping Festival last year, the company sold RMB 196 million worth of paid content, most of which were shows hosted by China’s popular key opinion leaders, such as talk shows.
US consumers are used to free podcasts, so there be must good reasons why people should pay, Wang said of the different attitude towards paid content. Apart from paid content being exclusive, Wang said their blockchain-based payment can be a good lure to convince people. Blockchain is a bit negative in China because all the ridiculous dramas involved, but in the US, it’s positive, Wang said. Introducing the concept to the platform will attract public attention and possibly increase their paid audience base.
Their app Castbox isn’t available in the Chinese market where there is already a fierce competition over paid content. The app is neither on App store nor Android stores because their database is outside China, Wang explained. It won’t enter the market in the near future either.
When asked about how to balance the quality of the paid content and its sales performance, Castbox stands by the market. The app is built by a team of engineers in Beijing, but the operation is all overseas. Wang said they mostly hire locals and seldom sponsored US working visas because she believes locals know the culture and market best.
Wang’s sales strategy believes in traffic and data, which are thought to be effective measurements of preference they sell on the platform. Castbox is also developing a recommendation system that personalizes feeds for users.