Nieman Foundation at Harvard
Welcome to Hot Pod, a newsletter about podcasts. This is issue 232, dated October 29, 2019.
A company, for art and profit. The last time I kept tabs on Kaitlin Prest — the Canadian creator of The Heart, known for her work around the complicated contours of intimacy — it was on the occasion of The Shadows, her big fiction project for the Canadian Broadcasting Corporation, which came out around this time last year. I thought the podcast was a solid effort, but my biggest takeaway from the experience was the notion that we were due for some kind of run. If this was the kind of newsletter that peddled in predictions, I would have placed a bet on the idea that 2019 could well be The Year of Kaitlin Prest…or at least a year where we’ll see a lot more projects emblazoned with her name.
That prediction would have been off the mark, though, as 2019 turned out to be a pretty quiet one for Prest. Like a handful of other podcast talents on the up-and-up, she’s moved out west to Los Angeles, prompted by the prospect of television opportunity. That kind of stuff tends to move along its own warped timeline and in many cases can take years to achieve fruition, if at all. And so, hearing about the relocation and these discussions, the relative quietness of her year feels understandable in hindsight, even unsurprising.
Also unsurprising: the fact that Prest has now joined the swelling ranks of prominent audio producers forming their own companies. She announces the move today, and it’s a development that seems poised to make her upcoming year much less quiet. She’s calling the venture Mermaid Palace, and there are a couple of interesting things about the effort worth unspooling here.
The core idea isn’t to build a podcast production company per se, but an organization modeled more after dance or theater companies. It’s meant to be an entity that will house a group of artists associated with Prest and foster an operating environment where they can collaborate, share skills, and develop works in a way that can hopefully relate to the needs of the marketplace on their own terms. There’s an inherent loftiness to the enterprise, partially expressed in what appears to be the project overview’s statement of purpose: “Sound works are largely absent in the art world,” it reads. “Narrative is absent in the sound art world. Art is absent in the podcast world. This project sets out to fill those voids.”
The document also discusses a multi-medium ambition, with expressed interest in making works outside of podcasts — notably film and, eventually, television. For now, though, audio makes up the bulk of the organization’s opening projects, peppered with some performance art.
Among the podcast projects in development: a new show with Radiotopia called Appearances, created by Sharon Mashihi, that’s scheduled for next summer, plus a new show with the CBC called Asking for It, featuring Drew Denny as writer and lead producer, slated for February. And at the moment, there are two scheduled instances of the aforementioned performance-art experiences: one next month at the Dynasty Typewriter space in Los Angeles, and another will be staged at Montreal’s Centre Phi in June. In addition to these projects, they’re also building two residencies, one for pitch development and the other for experimental works.
When Prest told me about the new venture over the phone last week, her founding story seemed informed by two things. The first is the position of relative leverage she found herself in following the release of The Shadows, when she encountered increasing demand for her work. Though The Shadows and The Heart weren’t major profit generators, they nonetheless drew strong, devoted attention. “They were successful within the model of success that was important to me,” she said. “Which is to, like, get good press, push the culture forward, get written into textbooks about the medium, stuff like that.”
The critical success of those projects made her, in her words, a known quantity. Opportunities opened up, as did the possibility of creating her own shop through traditional investment money. She expressed disinterest for that type of funding — “I just don’t want to be beholden to the guarantee that we’ll make the money back” — but she did harbor the desire to, in her words, “level up” in some way or another. The key question was whether she could find a way to capitalize on those opportunities in a way that felt appropriate to what she wanted to do.
The second thing that inform her approach was how she perceives the broader industrial moment in podcasting, which in her view has come to emphasize only certain types of outcomes. “The environment is quickly becoming one in which people are very risk averse,” she said. “It’s no accident that the CBC is the one who’s really throwing money at the work I’m doing. They’re a publicly funded institution, and so they have the freedom to take risks.” (She added: “But again, they were able to say yes to my risk because I had a track record.”)
Such were the cards in her hand: a track record of creating shows with devoted followings, a sense of momentum and some accrued clout, a broader industry environment that seems to distinctly benefit those who create companies, and some desire to build an organization in accordance with her specific value system.
When asked to further articulate that value system, she emphasized the notion of dualities. She talked about creating a non-hierarchical organization, one that’s able to acknowledge the contributions of everybody in the group but nonetheless able to benefit from her specific personal brand. She talked about a group in the style of an anarchist collective, but one that’s nonetheless able to reap the benefits of participating in capitalism. But most importantly, she talked about doing things in a way that could be remunerative, but not particularly pulled forward by financial imperative.
“We’re not out to make money,” she said. “We’re not out to make the money and fame grab that’s happening in podcasting right now.”
That said, money remains necessary fuel, whether to get an enterprise off the ground or just keep the lights on. In this regard, Prest was able to capitalize on her unique position and lined up an intriguing arrangement that allows her to skip out on the burdens of traditional investment (for now). The early years of Mermaid Palace will in large part be supported by wealthy benefactors. The arrangement dates back to the end of The Heart, when the team put out a call for support for business types who could help with their next steps. One thing led to another, and the specific opportunity to tap support from a cadre of wealthy patrons arose.
I suppose you could call it a throwback to the patronage system — or, more specifically, anonymous patronage. “I can’t name them or talk about them,” she said of the benefactors. “But we have guaranteed support for this year and next year.”
Anonymous or otherwise, the two years of guaranteed support gives Mermaid Palace a longer runway to get their own internal support systems going. The idea, I’m told, is to mitigate the upfront risk of experimental work at the top end, opening up a comfortable path for those works to find their positions in the marketplace over time. Prest believes that the experimental qualities of the work will ultimately be recognized as key value differentiators. “We’re interested in investing more money than people would ordinarily in things that would never make it through a pitch meeting,” she said. “We want to make work will be so distinct, honest, and craft-forward that the scarcity principle is going to work for us.” She also speculated there could be upside in these works becoming intellectual property for adaptation, which would yield further value to be cycled back into the company.
It should be noted that Mermaid Palace’s founding arc and structure — seeded by benefactors with a longer-term view of operations — isn’t particularly novel. You see this all the time in the nonprofit world, the arts world, and even the journalism world, with various publications being formed to cover important subjects that are initially funded by philanthropists with the expectation of developing a sustainable business model at some point along the way.
Of course, there’s an attrition rate when it comes to the companies coming out of those worlds, and the operating story with Mermaid Palace moving forward will be whether the organization can find a sustainable condition for its vision with the two-year jump start its assembled for itself. And that story, in turn, should be further juxtaposed with the larger idea Mermaid Palace seems intent on sussing out: how to find ways to extract benefit from the industry’s boom without having to comply with its costs.
Eat your greens [by Caroline Crampton]. There’s been an exciting development for U.K. podcasting: Last week, Sony Music announced a joint venture with the U.K. audio producer Renay Richardson, which will result in a London-based production company called Broccoli Content. It’s the first such venture by Sony Music outside of the U.S., and as far as I can tell, it’s one of the first deals of its kind in the U.K. where the funding is going to a company rather than a specific show or series.
In light of this news, I’d like to highlight what Renay said in her Hot Pod interview about how her company got its name: “I learned the term ‘broccoli’ when I was pitching a series that I later made independently. The series was About Race with Reni Eddo-Lodge, and while pitching it…I was told the idea was ‘broccoli,’ meaning ‘it’s good for you but no one wants to eat it.’ I was also told that it would have to be geared toward a white audience.”
Luminary gets a new CEO and raises more money. The news came out Thursday: Former HBO president and chief revenue officer Simon Sutton replaces founder Matt Sacks as CEO, who will now assume the role of executive chairman. The company also announced that it has raised an additional $30 million in Series C funding from “existing and new investors.” A spokesperson declined to comment when asked about the identity of those investors; as the dude Peter Kafka over at Recode/Vox notes, the lack of identification is a “departure from standard practice.”
🤔
Anyway, that the new CEO is a television and cable veteran — not, say, an audio programming veteran — is an interesting twist, though not terribly so. Shouts to the kicker on Variety writeup of the matter:
Sutton said he first became familiar with podcasting listening to NPR programming on long drives around California. He declined, however, to reveal what podcasts are his favorites.
“I’m going to be meeting a lot of podcast creators who are going to be upset if I don’t name their shows,” he said. “I can only lose by answering that question.”
Additional shouts to the Hot Pod reader who slid this into my DMs: “Sounds like a guy who has definitely heard a podcast before.”
This week in Spotify. Barry McCarthy, the company’s chief financial officer who oversaw its unconventional direct listing, is retiring. Here’s The Wall Street Journal on the matter. And for good measure, here’s what McCarthy said, also in the Journal, about podcasts and the company back in the summer:
The investment in new content to drive growth for Netflix was in streaming content on top of the DVD content. For Spotify, the investment is in podcasts. Original podcasting content for Spotify comes with a fixed cost, just like the streaming investment for Netflix came with a fixed cost, and over time, as it became a large percentage of the business, it shifted the Netflix cost structure from variable to fixed. That had some profound implications for the evolution of that business model.
Also, Spotify’s third-quarter earnings came out yesterday, and the corresponding shareholder letter made the following remarks about its podcast operations:
The reflexive framing here would be establish the narrative as a whole “Spotify’s on track to eat up Apple’s podcast market share” situation, but in reality, it’s hard to do a proper Spotify vs. Apple comp without the latter actually disclosing similar-to-comparable metrics. As far as I can tell, Cupertino remains opaque, which means Spotify gets to run the narrative however it wants right now. And you know what? This is indeed a narrative game at the moment, one that Apple isn’t doing much with…if they’re interested at all.
Apps, apps, apps. Tyler Falk over at Current reports that NPR is consolidating its two apps — the NPR prime app and the NPR One app — into one big fat squishy app-zilla, in a bid to help confused users…and maybe even boost the organization’s app prospects. The audience for both apps had apparently flattened out.
How to spend a crowdfunder [by Caroline Crampton]. The British podcast sitcom Wooden Overcoats has racked up plenty of plaudits since its first series was released in 2015, including a Best of iTunes slot and a British Podcast Award. Its creators were relatively early into the now-booming fiction podcast scene, but the show still stands out (especially in the U.K.) because of its high production standards, its ambitious scope and cast size, and its extremely loyal fanbase.
Throughout its run, the team has been pretty successful in leveraging that loyal fanbase to keep the show going, running a crowdfunding campaign to finance each new series. On October 15, it was announced that the fourth series will be the show’s last and that the crowdfunding campaign for it will cover ten episodes rather than the usual eight. The campaign met both the £15,000 ($19,250) initial target and the £17,000 ($21,817) stretch goal by the halfway point of the fundraising period, and it appears that fans are still donating so they can receive a bonus Halloween special.
But I wondered: What happens once a campaign like this meets its targets? How, exactly, does the money materially translate into a series? In search of answers, I jumped on the phone with Liz Campbell, production manager for Wooden Overcoats, late last week to find out how the budget for such a show is constructed.
Campbell explained that the overriding motive behind the show’s campaigns is to pay everybody fairly for their work. “The reason we do a series-by-series funding model, as opposed to a Patreon or something like that, is because we made the decision fairly early on to only make more episodes if we could fairly pay everybody for their time,” she explained.
She went on to say: “For season one, there was a bit of money around for the studio and things like that, but people largely participated on a volunteer basis, which was I think fine for the purposes of getting a show off the ground.” But to continue beyond that, the seven members of the production team felt they had to be able to pay their contributors; otherwise, they simply wouldn’t do the show.
Campbell joined the team before the second season, as they prepared to begin the crowdfunding campaign. A fun bit of biography here: Campbell is a criminal barrister by profession, but shared a flat with some of the Wooden Overcoats team at the time and was happy to take part in the production process, having done some theater in college.
The firm commitment to paying everybody governs how the team sets crowdfunding targets as well as the season’s overall budget. For this final season, Campbell explained that they needed about £25,000 ($32,000) for production, and that they currently have about £10,000 ($12,800) in the bank from live show ticket sales, merchandise, and sponsorships. As such, the campaign implemented an initial target of £15,000 to make up the budget gap.
Since there will be ten episodes in this final run, she estimates the cost for each installment to be around £2,500 ($3,200) — a figure that includes a percentage of the various running costs that apply across the whole series and beyond, like web hosting and marketing. An estimated 80 percent of that number goes to “human costs,” i.e. pay for actors, writers, editors, musicians, the composer, production support, photographers, and videographers. The rest goes on studio costs, hosting, food, company costs, renting rooms, printing, and so on. Almost everybody gets paid on a half or day rate, other than the writers, who are usually paid per script.
I must admit: I was a little surprised by this breakdown, because I had assumed that studio costs would account for a significantly greater slice of the budget than what’s listed here. But Campbell says that, although studio costs have risen during the time she’s been working on the series (probably as more recording establishments in London get wise to the fact that podcasting is professionalizing), paying the 50-plus people who work on the series has always been the biggest cost factor.
“We have an average actor-per-episode count of about ten. We have an orchestra. We have a composer…so we budget up it all out carefully,” she said. Wooden Overcoats Ltd, the incorporated entity housing the show, has seven members who also get paid for their work — though Campbell said that they often go above and beyond what they bill for the show. (They have their own day jobs as well.) At the moment, this podcast is the only thing that the company makes, so accrued money gets invested in that direction.
Wooden Overcoats’ large headcount is one of the more striking things about the show. There’s very little doubling up of actors of different characters, it’s fully performed by an ensemble cast rather than being narration-led, and there’s original music throughout that is recorded live by the orchestra (complete with church organ). Campbell says that head writer David K. Barnes has always been free to take the story in any direction he chooses, regardless of financial constraints, but that the writers’ room has been pretty good at balancing the costs of a character-heavy episode with a smaller one later in the series.
Because almost all audio drama in Britain was made by the BBC until fairly recently, Campbell said that it’s been challenging to work out what fair market rates for an independent podcast drama are. “Back when I was trying to make a budget for season two, really the only points of reference were BBC radio recordings. And those figures are exceptionally high and they’re also just not particularly applicable. They deal with a regional buyout rebroadcast and all the things that don’t really apply to us,” she said.
She added: “Realistically, as an independent production, we’ve no chance of following a BBC kind of funding level. So we’re trying to forge our own path. It’s important to us to try and pay people a little bit better every year, which we have managed to do.”
