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Why does “Serial” need donations?

Why does “Serial” need donations?


Image from: ThisAmericanLife.orgI’m bullish when it comes to the business of podcasting. I’m not alone, as evidenced by articles explaining why podcasting is surging, like this one from New York Magazine and this one from The Washington Post and this one from The Financial Times.

Combine those good vibes with the tremendous popularity of the new podcast “Serial” and one would be led to believe Sarah Koenig and staff are on their way to fame and fortune, right? Ok, maybe not fortune like Bill Gates and Warren Buffett, but still enough money that they don’t have to ask for donations to keep going. Right?

But that’s just what they did at the start of Episode 9. Koenig even said to her listeners “maybe you saw this coming.” I for one can say “No!” I did not see this coming. Serial has been hailed as “podcasting’s first breakout hit” by the New York Times and CNBC says Serial is “making podcasting go mainstream” CBS quotes Apple calling Serial the “World’s Most Popular Podcast” and there are ads on the podcast so, no, I did not see this pledge fund drive coming.


THE NUMBERS: Advertising

Koenig says the ad revenue doesn’t cover the cost of production.

According to the CNBC article, Serial is getting an average of 1.5 million downloads per episode. There is one creatively produced sponsorship at the beginning from Mail Chimp, and another sponsorship message from Square Space. Each pre-roll ad is 15 seconds long. There are no mid-roll ads in Serial.

Most Podcast ads are sold by CPM. Take the download number of 1.5 million and divide by 1000. (answer = 1500) Take that 1500 and multiply it by the rate you charge Mail Chimp and Square Space.

So what does a podcast ad cost? It varies. The fact that Koenig herself doesn’t read the ad decreases the amount of money she can charge. I assume she’s not going to read the ads, because she’s a journalist.

Search around to see what you can find on this and you can find your own answers, I’ll provide a few here. At Entrepreneur On Fire they say a 15 second pre-roll ad goes for $18/cpm. Another article at puts the CPM for a large audio podcast between $15 and $20 per listener. The NY Mag article I already linked to has CPM’s between $20 and $45. The article even mentions the possibility of Koenig reading an ad.

Let’s plug in some numbers. Let’s use a low estimate and say Serial charges a $10 CPM for each ad.

$10 x 1500 x 2 = $30,000 per episode

Using a low-end guess for the CPM, we come up with $30k per episode! So far, there have been 9 Episodes… or $270,000 in revenue. If the CPM goes up, the final number goes up too.($15 = $45,000 per episode or $405,000 total revenue through 9 episodes.)


OK, OK, I get it.

I have reasoned myself out of my original outrage. Serial could charge at the top of the CPM scale ($45) which would put them at $810k of revenue through 9 episodes, or they could ad another mid-roll commercial for more revenue, but in both cases I can see how the math doesn’t add up to support the kind of work they are putting together.

You can see how a podcast with less production cost could in fact be very profitable. I think that many of the podcasts that just have 2 or 3 people with mic’s gabbing with each other are great, but we need more than that. I want quality storytelling and production like Serial to live and thrive on it’s own, but I guess we’re not there yet.

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I'm surprised a single sponsor wouldn't just pay $300k so Serial could avoid ads. 

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