Podango – Bankruptcy Looming?

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Without coming out and saying it in plain English, Podango has basically said get your stuff off our servers ’cause we are going under… When the President of an Internet startup says “we are encouraging you to begin taking all necessary steps to secure your data or begin moving to another hosting provider” you can read the writing on the wall. Looks like bankruptcy. Two years ago, people railed against me for my “Podcasting Is Dead” presentation. I’m not sure how many more examples I need to point to until folks realize – I was dead on. You are in the media business, forget “podcasting” – that is so 2005.

I think this also says something about the “network of shows” model Podango and several other startups were counting on. Grouping together unrelated shows in order to sell advertising across all of them simply doesn’t work. Aside from the fact that none of these companies has a dedicated sales team (something every successful content company has from day one), advertisers simply don’t see value in using a shotgun method to reach their target market. Besides, wasn’t reaching a super-targeted audience exactly what new media promised in the first place? Slapping an old business model on new media was destined to fail.

Podango was started by some great folks, primarily Lee and Doug, both stand up guys. In fact I sold technology to them a few years back. No one takes joy in situations like this, it is a tough spot. They are smart guys and will weather the storm. Look for them on the backside. I expect they’ll be back.

So who’s next? Anyone heard from Mevio (Podshow) lately?

Limited Sale On New Media Audio

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We’ve opened the New Media/Podcasting vault and have a special offer for one week only.

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New Media Expo: Top Ten Take Aways

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I have just returned from my 4th Podcast/Portable & now New Media Expo. Once again, a first class event. As most of you know, I have been involved with podcasting since before it even had a name. Having participated in it all along the way, this year’s Expo solidified many of the thoughts I’ve held over the last year. The items in this list are not fully developed; I could easily do a 30-minute podcast on each. These are more a summary of my stream of consciousness top ten take aways:

1. The Expo continues to enable us to re-connect with old friends. There is a real sense of camaraderie among the original podcasters. That was no different this year. Good times with lots of great podcasters.

2. The New Media Expo was once again a great opportunity to meet new people who are excited about podcasting. A lot of fresh faces this year.

3. Tim Bourquin (the show’s organizer) got some flack this year about the exhibit floor being smaller – not true. The show had the exact same exhibit space as in years past: 12,000 square feet. It was a much bigger venue, which affects the perceived size. Kudos to Tim for stepping up and making the financial commitment to lock in the Las Vegas Convention Center. That said, the exhibit space did not grow. In a “growth” industry that spells trouble. My take, one I shared with Tim at dinner this past week, was to lose the exhibitors and focus on the conference. (The conference sessions are where the real value lies in my opinion.) Tim is one of the most diligent and hard working people I know. If he can’t corral the exhibitors it is not for a lack of effort, it is a signal that they are not sold on the market potential. (Curious to see what he announces regarding next year.)

4. A schism is developing between “indie” podcasters and those they thought were focused on supporting them. I had conversations with CEO’s who are now clearly focused on large corporate clients; those with the resources they believe are capable of massive reach. They want to fulfill those companies’ production and ad sales needs. Think podcasts produced by TV networks, media companies and news organizations etc. This makes complete sense from a business plan and sales perspective, but is very different from what you heard from these same companies just a year ago. Some of the well-known employees of these companies have not yet come to terms with this shift. You hear one thing from them and something completely different from their “C” level management.

5. Many content producers have finally realized that if they want to monetize, they are on their own. You are your own best salesperson. Need proof? Look at who did not attend this year. If ad sales/aggregation groups were working as a market segment, they would have been the largest contingent of exhibitors. Most have vanished or “refocused” their business plans.

6. If you insist on trying to monetize your “indie” podcast (less than 50K downloads per episode) I stand by my previous advice: Sell your own ad/sponsor deals. If it is not in your blood – i.e. you don’t like selling/asking for money, my advice is to contact Todd Cochrane. Wow! Big surprise there. Many know that I have, at times, been critical of Todd’s collection of companies. But I also give credit where credit is due. With the shift of everyone else heading to the higher ground of corporate size distribution and budgets, Todd & Co. are the only folks left who passionately believe in the “indie” podcaster. I still think you can and should get more, but if you don’t like the work involved, Todd will give you a fair shake.

7. Passion is critical. Find something you love and podcast about that. Things seem to work out for those who are truly passionate about their content.

8. Corporate podcasting is alive and well. Just as with my presentations at this year’s CES and NAB conferences, companies and the folks they have charged with their podcast initiatives continue to come to sessions to learn how to produce compelling and interesting content. As I’ve said before, the real money is in consulting to these organizations, they have budgets: money to spend. If you carefully look to see who continues to come to NME events you’ll notice many of the monetization experts are in the podcast consulting business.

9. A common thread I heard during conversations with some well-known podcast figures was “I’m figuring out what I am going to do next” and “it was good while it lasted.” See #10 below.

10. I can’t help but end with this: My presentation last year was dead on – I gave everyone a full year’s notice. Don’t say I didn’t warn you.

UPDATE: 11. (How could I have forgotten 11? Everyone knows all good things go to 11.) Brian Ibbott did an amazing job with the Coverville 500. That took real planning, work and investment. I can’t tell you how impressed everyone was with the event. Brian put on a great show and was ably assisted by Dan Klass as the evening’s MC. Great job guys!

Wizzard Q2 2008 Results: My Take

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There has been a bit of fan-fare today regarding Wizzard’s press release about it’s Q2 2008 financial results. Both Paul Colligan and Podcasting News have highlighted the “bright” points of Wizzard’s press release. For those that think Wizzard is proof that podcast advertising is the answer I’d like to offer some context and thoughts:

  • Wizzard reported gross revenues of $1,465,874 for Q2/2008 – how much is podcast advertising and how much comes from their original “core” business of speech technology? It is never defined. Don’t make the mistake of assuming it is all podcast related.
  • Operating expenses for Q2 came down to $2,159,433 but things are still clearly in the red.
  • Wizzard is a 12 year old company (founded in ’96) loosing millions per year.
  • Wizzard makes no mention of their original business of “speech technology” in the substantive portion of their press release, it is all podcasting. What does that tell you?
  • Wizzard is a public company with only an estimated $6M in gross revenues – would you invest? (You Can: WIZD)
  • 3% revenue growth over Q2 2007. That is the nail in coffin. If they were in a mature industry such as the steel, oil or auto business that would be great, but an “explosive” growth segment such as New Media Advertising? You do the math.
  • A reported 1 Billion downloads last year and only 13 advertisers secured by their “sales pioneers.” 13! That is 1 advertiser per 76 million downloads.

I know a lot of people see $1.4M in a quarter and think wow – that is a lot of money, but given expenses of $2.16M it is not. If they were a new startup it is one thing, but this is a “mature” public company 12 years in the making. I know some of the folks at Wizzard – they are energetic, enterprising and I have high expectations for their future accomplishments. Just make sure you read their press releases with a bit of contextual balance.

UPDATE: I had a nice conversation with Chris Spencer, the CEO of Wizzard yesterday. We probably chatted for a good 20 minutes. I’m glad we got the opportunity to meet each other, and enjoyed our exchange. I’m still looking for explosive growth in the segment. We’ll see what the future holds.