What\u2019s Happening:\r\n\r\nInnovations in podcasting are happening at a rapid pace \u2014 new technologies such as smart speakers, AirPods and connected cars have made it easier than ever before for consumers to stream audio. There are currently more than 700,000 free podcasts available on the market, with thousands more being launched each week.\r\n\r\n\r\nWhy it Matters:\r\n\r\nThe continuing popularity and development of the podcast market is creating more revenue and opportunities for creators, and encouraging more high-quality audio content to emerge. As new tech platforms hit scale, the consumer team at AH Capital Management, L.L.C. (a16z) has been closely watching the podcast ecosystem for startup investment. In doing such, they\u2019ve developed a kind of \u201cmarket map\u201d that provides a good outlook into the opportunities for podcasting throughout the rest of 2019.\r\n\r\n\r\nDigging Deeper:\r\n\r\nSome of the key findings of the a16z market map deck include:\r\n\r\n \tPodcast consumption is growing rapidly; over the last 10 years, it has gone from a niche internet community to one-third of Americans listening monthly, and one-quarter tuning in weekly. 65% of these active listeners only began listening to podcasts in the last three years.\r\n \tOn average, Americans listen to seven podcast episodes per week, consuming an average of just over six-and-a-half hours weekly.\r\n \tThese podcast listeners do not fit into the \u201caverage American\u201d demographics. About half have an annual income of $75,000 or more, most have a post-secondary degree, and nearly one-third have a graduate degree. Slightly more than half are male, though that gender gap is closing.\r\n \tSmartphones have pulled ahead of computers as the dominant platform for podcast consumption.\r\n \tPodcasts are listened to most often in users\u2019 homes (48%) or in the car (26%). Smart speaker use for consuming podcasts has grown 70% year over year. A16z predicts that this trend and Bluetooth-enabled cars could change the mix of where podcast listening happens.\r\n \tThere are many different apps for listening to podcasts, with little user differentiation or loyalty between them \u2014 though it is predominantly an iOS user behavior. The content itself is what\u2019s important to listeners.\r\n \tThere is an extreme power curve among podcast creators. The median podcast has only 124 downloads per episode, while the top 1% has 35,000 downloads.\r\n \tThe monetization of podcasts largely mirrors that of the early internet, with revenue lagging behind attention. The market is still in a very nascent, disjointed state of monetizing. Ad revenue in the format is growing, estimated to hit over $500 million US in 2019, but still very tiny compared to the ad revenue of other content formats.\r\n\r\n\r\nThe Bottom Line:\r\n\r\na16z reports that today\u2019s headlines about podcasts hail them as the next major content medium, describing them as \u201csuddenly hot\u201d, as the next battlefield for content, and as an \u201cantidote\u201d for the current news environment. Yet, this \u201csudden\u201d popularity has been building over the past 15 years.\r\n\r\na16z believes that the most promising podcast players will focus on general audio content in a broad way, not exclusively podcasts; will take advantage of network effects; will offer high-quality differentiated content; and have monetization streams outside of advertising (i.e. subscriptions).\r\n\r\nIf you\u2019re interested in getting a PDF version of the 68-page deck itself, you can sign up for the a16z newsletter to get a copy.