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Friday, January 27, 2023

The Obamas are Saying Goodbye to Spotify in Favor of a New Multiplatform Podcast Partnership

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The Obamas’ tenure with Spotify Technology SA is drawing to a close. According to those acquainted with the negotiations, the ex-first family’s production firm, Higher Ground, will not sign a new partnership with the audio platform. Instead, the company is in talks with other distributors about a contract that may be worth hundreds of millions of dollars and is one of the most profitable in the podcasting industry.

Apparently, Higher Ground has been in talks with several possible partners, including Amazon.com Inc.’s Audible as well as iHeartMedia Inc. Within the next two weeks, the firm wants to find a new location. According to three sources acquainted with the conversations, it has approached several major networks, notably Spotify, although the Swedish streaming behemoth has rejected making an offer.

In New York, Spotify’s stock was hardly altered. Amazon’s stock increased by 1.1 percent, while iHeartMedia’s stock increased by 2.5 percent.

Higher Ground is looking for an agreement that will enable it to produce many shows at the same time and distribute them across multiple platforms. Given that iHeart hasn’t always depended on an exclusive approach for its podcasts, this could explain the company’s interest. This is one of the reasons why some potential bidders, such as Spotify, have withdrawn their bids; a widely broadcast show will inevitably wind up on their platform. Exclusive rights to market their services have been pursued by firms such as Spotify and Amazon.

The Obamas have agreed to feature in an eight-episode show, which may not be enough dedication for some of the bidders to justify a deal equal to those for shows such as “SmartLess,” “Call Her Daddy,” and “My Favorite Murder.” Those shows air on a weekly or near-weekly basis, although Higher Ground’s Obama-related programs have been restricted in number.

In 2019, as the Obamas prepared their post-presidency media venture, Higher Ground secured an agreement with the music streaming powerhouse. Since then, the organization has released a few podcasts, the first of which is “The Michelle Obama Podcast,” which shows the former first lady conversing with family and friends about relationships. The show was among the top five most popular podcasts in 2020, according to Spotify.

Under the current partnership, Spotify and Higher Ground were partners on the shows, implying that the future collaboration would be for new programs.

During their collaboration, Spotify and Higher Ground¬†have had disagreements. Two podcasts, one by the name “The Michelle Obama Podcast” while the other by the name “Renegades: Born in the USA,” a podcast featuring Barack Obama and Bruce Springsteen, launched exclusively on the site. They didn’t go live on other services for months. Higher Ground paid Spotify for exclusivity, but the production firm discovered that being tethered to one service reduced the audience for its performances.

The two parties also couldn’t agree on how much of the company’s output should feature the ex-president and the former first lady. Higher Ground sought to use their arrangement to create a platform for a variety of voices, while Spotify sought more shows involving two of the world’s most famous people.

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