HOW PODCASTERS ARE BEING ROBBED AND LEFT BROKE - podcast episode cover

HOW PODCASTERS ARE BEING ROBBED AND LEFT BROKE

Dec 20, 202319 min
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Episode description

In this episode, hosts Rashad Bilal and Troy Millings delve into the intricacies of podcasting monetization and business models, accompanied by guest and former music industry figure, Loon. They tackle the common misconception that advertising revenue alone is sufficient to sustain a lucrative living through podcasting. Rashad points out that while there's substantial money in ads, most podcasters struggle to amass a sizable audience, which is crucial for significant ad revenue. This leads to the conclusion that creativity and diversification are essential components in generating income beyond ad revenue.


Loon shares his insights on the potential pitfalls of early fame, emphasizing the importance of maintaining focus on business aspects, such as selling merchandise, services, and creating subscription-based models. The conversation delves into the dynamics of podcast ownership, with the hosts expressing the necessity of maintaining control over their show, even in the face of potentially lucrative contracts. They shed light on the prevalent lack of transparency in the industry and the nuances of negotiating podcast deals.


The discussion unpacks the complexities of CPM (Cost Per Mille) and RPM (Revenue Per Mille) metrics in podcast advertising. Rashad and Troy demystify the intricacies, highlighting the potential for podcasters to negotiate payment based on their episode's worth, rather than getting entangled in opaque industry standards and complicated financial arrangements.


Loon brings attention to the importance of engaging with paying customers, emphasizing the unique expectations and responsibilities that come with building a community of supporters behind a paywall, as opposed to relying solely on free content. The hosts and guest also touch on navigating the mental strain of managing a podcast, from dealing with comments and criticisms, to the financial strains of running a podcast.


Overall, this enlightening episode provides valuable insights into the multifaceted world of podcasting, offering a behind-the-scenes look into the business side of the industry and emphasizing the criticality of strategic business models and diversification in generating sustainable income streams.

#Monetization

#PodcastingBusinessModels

#AdvertisingRevenue

#PodcastOwnership

#CPMandRPM

#ManagingPodcastFinances

#PaywallEngagement

#PodcastCommunity

#EYLMedium

#PodcastInsights



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Transcript

Speaker 1

An illegal alien from Guatemala charged with raping a child in Massachusetts. An MS thirteen gang member from Al Salvador accused of murdering a Texas man of Venezuelan charged with filming and selling child pornography in Michigan. These are just some of the heinous migrant criminals caught because of President Donald J. Trump's leadership. I'm Christy nom the United States

Secretary of Homeland Security. Under President Trump, attempted illegal border crossings are at the lowest levels ever recorded, and over one hundred thousand illegal aliens have been arrested. If you are here illegally, your next you will be fined nearly one thousand dollars a day, imprisoned, and deported. You will never return. But if you register using our CBP home app and leave now, you could be allowed to return legally.

Do what's right. Leave now. Under President Trump, America's laws, border and families will be protected.

Speaker 2

Sponsored by the United States Department of Homeland Security.

Speaker 3

People like going back to the monetization thing. Most people are not going to be able to monetize awful ads, so like to really like live efficiently. So it's like, why do you think that it's just not enough money in it. And I feel like.

Speaker 4

What I'm saying, ads transition to like super Bowl, it's a lot of money and ads.

Speaker 3

Now most people are not going to get a lot of money.

Speaker 5

Audience, but you can't make money.

Speaker 3

So I feel like ads should always be a add on, But you got to be creative to find ways to make money outside of that. That comes with creativity. That can come with merch that can come with live shows, that can try yeah, the Patreon, that can come from a service subscription based model. You know, if you got an app or whatever you got, you know going on. That's up to you to figure out your own business model what you have to offer. But how can I

make money outside of this that I control? Because you can't control ads either. You might have an added you know what I'm saying. So it's like you got an audience, you got to make sure that you're maximizing that audience. I think a lot of podcasters don't fully understand that either.

Speaker 4

Now because again they okay with just the audience. Here's another thing. Getting fame almost cripples you, especially when when you get it too early, right when you're still in the process, because fame and notoriety makes you not do what needs to be done to get to that next level. Right, So say I need to be out there selling shirts or selling CDs or selling something.

Speaker 5

That will help my business. The minute they put me.

Speaker 4

On breakfast club, like, I can't stand out there here, right, So it cripples you. It's like it says, damn, okay, now I'm too big to do that. Well you have to do that to get there.

Speaker 3

But then also everybody's not a business person too, so most people coming in and they just coming in just from a media standpoint of I just want to talk and then I'm gonna less somebody payment. It's like an artist, right, Most recording artists just want to wrap and then they want to get paid for rapping. That's why I said, like you signed a deal, it's not a bad deal

because you're not a business person. So you need somebody to take care of you in the feed you and you need somebody to schedule your shows and to make sure you're here and all of that. But we the other way around, like this is just allowed.

Speaker 5

Can you compete with five million a year?

Speaker 3

Can we can people five million a year? We compete with anything?

Speaker 4

Perhaps, so what I'm saying it's allowed to it'll take a three year thirty forty to fifty million dollar deal forty million, three year, forty million dollar joint.

Speaker 5

I mean three year, twenty million dollar joint.

Speaker 3

So I'm I'm if we get to maintain an ownership of our show? Yeah, why not?

Speaker 4

Because I think every big podcast is maintaining ownership.

Speaker 3

Man, are they I don't know.

Speaker 5

I'm asking you, what's your deal on that? I don't think they are?

Speaker 3

Are they serious?

Speaker 6

I mean we don't know though, right, I mean we don't Again, we don't know people in our sitting information. And then again people don't know they see the money, that's the carrot.

Speaker 5

How do I get it?

Speaker 2

Oh?

Speaker 3

Yeah, yeah, I'll get it. Yeah.

Speaker 6

How long do I have that to show our propetuity? I don't even know what that means. I signed it.

Speaker 5

Not no big shows.

Speaker 3

But I'm not saying thank you.

Speaker 5

Think so.

Speaker 4

I don't know, though, we don't know speak, but we believe people that know about business.

Speaker 5

We may have heard that. Wow, we may have wow.

Speaker 3

There's something. If there's something. Shows that I know that don't own the show, but out even signed a big contract they gave they cave up the rest of the show. So it's a lot of.

Speaker 5

Some big shows in our coach just.

Speaker 4

Wow o God, y'all' talk off here about it?

Speaker 3

Is that once again going back to information, right.

Speaker 5

You didn't think they were going out saying so I'm not going out, You're not going you're starting like that.

Speaker 3

I'm not one of those people that saying like it's bad to sign because, like I said.

Speaker 4

It's bad to give away rights if specially if you have some sort of built it Okay, so the people Okay, so people out there in TV land, these companies won't give you any money unless they see some money there. So if they say I want your show, right, they usually only offer those kind of deals to people with the built in fan base like we're talking about.

Speaker 5

They don't offer those to some Joe blow off the street nine times out of ten.

Speaker 4

So you're coming with a built in fan base and you don't even have faith in it, but you have faith in them to activate.

Speaker 3

It because yeah, because once again they have the relationships they they Pablo right.

Speaker 5

This is the easy one. I just take the money. Did y'all take care of that? I'll do this. Wow. They go from owners to talent very quickly.

Speaker 3

But like I said, signing because Nipsey Hustle doesn't become Nipsey Hustle if he doesn't sign to a major.

Speaker 5

Now, yeah, you some points.

Speaker 3

You gotta make a you gotta make it, gotta make a decision, and you gotta understand it. You can only go so far by yourself.

Speaker 5

So y'all saying y'all won't sign.

Speaker 3

We did sign. We signed to our heart for two years.

Speaker 4

But I'm saying if somebody won't action on video, action on the whole.

Speaker 3

Everything is negotiable. Everything is negotiable. I feel like you can't be emotionally a tie to anything.

Speaker 4

So y'all would take a three sixty invest fits and on. We could set going in on everything. If it's enough money, we can sell it.

Speaker 5

What's enough money?

Speaker 3

It has its.

Speaker 5

Good question?

Speaker 3

Did you hear last week's market?

Speaker 5

Money?

Speaker 3

But I mean, but that's real talk though, right. Anybody anybody that says otherwise is lying to you. Let's be honest. Somebody come with a check for a billion dollars?

Speaker 6

Yeah, for sure. What's the valuation of this company? It's three billion? Okay, Well, guys, we've earned our leasion, right, it's been real.

Speaker 5

What about Okay, So what what is an ad worth? What? What is the ad.

Speaker 4

Worth on the show that's getting two million downloads?

Speaker 5

Like? What what is the gauge?

Speaker 2

Like?

Speaker 4

What is what? What's the gauge for a young podcast or anybody watching? What are we dealing with out here?

Speaker 5

What's the gauge? I think you said it.

Speaker 6

We were at a show and they were talking about streaming and they're like, well, what's one stream worth? Nobody can give an answer, right, and so what's one down long worth? That's a person?

Speaker 4

But just talk about like I'm so like where the industry stand at right mask They'll tell you the CPM rate, they'll tell you like it's seventeen fifty, or the average premium the PREMU is fifty dollars per every thousand. But I didn't believe in that, and so I said, look, we'll create our own market. I'm going to tell you the number is fifteen thousand an episode. Now you could take that or you could leave it, but here's our numbers.

I don't want to we're not doing the CPM thing. Well, most people they're looking at the value that we add. They know that we're going to be consistent. So now I don't even do the seat keep going.

Speaker 6

I'm sorry, yeah, yeah, no, So that I stopped. We just stopped doing the CPM, and we said, like, this is what we're worth. So if I tell it's fifteen, I will then let's see if we go up to four million. Well now I'm telling you it's twenty five. This episode is brought to you by P and C Bank. A lot of people think podcasts about work are boring, and sure they definitely can be, but understanding a professionals routine shows us how they achieve their success little by little,

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Speaker 5

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Speaker 6

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Speaker 1

An illegal alien from Guatemala charged with raping a child in Massachusetts. An MS thirteen gang member from El Salvador accused of murdering a Texas man of Venezuelan charged with filming and selling child pornography in Michigan. These are just some of the heinous migrant crewminals caught because of President Donald J. Trump's leadership. I'm Christy Noman, the United States

Secretary of Homeland Security. Under President Trump, attempted illegal border crossings are at the lowest levels ever recorded, and over one hundred thousand illegal aliens have been arrested. If you are here illegally, your next you will be fine nearly one thousand dollars a day. Imprisoned and deported, you will never return. But if you register using our CBP home app and leave now, you could be allowed to return legally.

Do what's right. Leave now. Under President Trump, America's laws, border and families.

Speaker 2

Will be protected sponsored by the United States Department of Homeland Security.

Speaker 6

So I'm going in with it, not with the traditional man of this is my CPM and if I hit this number based on that, then nactually get paid this not because I know when you go to corporate and you're not telling them that, and that's.

Speaker 5

The game they try to lock young.

Speaker 3

Of course, the game is this though, because me trust.

Speaker 4

And let me say this for the onlookers, I play both games. Right, even with Slim and Husky's and other brands. Again, I have my own relationships with brands, my Bookie, other brands where I negotiate things on my own, but that they do play that CPM game on the other side, on the on the on the iHeart side is a very CPM driving game.

Speaker 3

Here's the machine. Here's the thing. Here's the thing with how did y'all okay, here's the thing with life in general, especially when it comes to business. The more math that's required, the higher probably that you're going to get screwed. Right because this this, this, this is this s that they do. They do it CPM. Most people't even know what the CPM is, right, And it's like if you if you do, if you put it at at the beginning of the episode,

that's the most valuable. Middle episode we called Mini. That's the second most valuable. The first one is pre roll pre roll. Let me just finish.

Speaker 5

Hold on because I want you to be very clear.

Speaker 6

In terms of money, the midrod is going to be the most valuable, right because the pre road is only ten seconds. They want your mid road because they know that's going to be sixty seconds. They could put two there sometimes they'll put four. Now your audience is going to say, well, there's a lot of ads here. Well,

we try to it's a business. So the ten second they'll say, all right, Well, if that's the mid road is twenty thousand, they'll say, we'll give you eight thousand for a pre roll because it's shorter.

Speaker 3

I got so. And then it's like, all right, so you get paid seventeen fifty per cpm per thousand downloads and seventeen.

Speaker 6

Dollars seventeen thousand and fifty cents per every thousand per thousand, right, so by the time you get twenty thousand downloads, no, no, sorry, so so seventeen seventeen fifty.

Speaker 3

But then it's but then it's a seventy thirty split, right, it's a seventy thirty split, seventy year away, thirty thirty their way. And then it's for every thousand. Right, so if you do one hundred thousand downloads for that episode, how much money did you make? Exactly? So that's the whole point. It's confusing me. I never really got past basic algebra in school. So if I gotta use a calculators too complicated. You needed to be twenty grand episode,

twenty thousand dollars an episode. Yeah, I can do that.

Speaker 5

I'm glad y'all see this game.

Speaker 3

This good twenty thousand dollars an episode for a sixty second ad that we can all understand.

Speaker 4

That, right, it's very simple, very simple. A CPM is triggery. What you're saying it sounds like more.

Speaker 5

Here's the other part, right, how do you know how many downloads?

Speaker 6

Because the machine gonna have to download me there, and they're gonna tell you, well, you didn't meet the metric you could.

Speaker 5

Track it to they got third party ship, but you don't know how to act.

Speaker 3

Now you gotta get a forensic account. Once again, the more complicated the math, the higher probability you have of getting screwed. They keep it complicated on purpose. Okay, you get a minimum guarantee, but you gotta you gotta hit a million, you gotta hit this. But who's counting these numbers? Well, we have our firm and back and they counting these numbers, and then they're going to give you a report. Then they're going to but you don't even know what the hell happens.

Speaker 5

What happens when it strength? What's the stream versus down. What happens when you don't hit the minimum guarantee? Then this is a yeah, what happens when you don't hit it? They're trying to recop get your money. Yeah, we got to recoup this money. And now it's the rap game. But you know you're in the rig in the red.

Speaker 6

You know, No, we're not paying you that because we got to get the money because the first season you didn't really make that.

Speaker 5

Well, how we're looking at the message every month?

Speaker 3

All this is a question mark even YouTube. Nobody really knows. It's just YouTube. It's just too big and too powerful where you don't really have an option. Right, it's like what can you do? Nobody knows how much money is actually coming into YouTube, how they're distributing it. Because some ship we might get paid thirty five dollars for some ship we might get paid four dollars for depending on the content, depending on the time of day, depend on who's who's on it.

Speaker 4

And then it's constantly changing. Then it can be affected by things outside of our means, and you can wake up tomorrow and it can be up.

Speaker 6

But they so they do RPM when you do the visuals right, So the CPM is what they're gonna pay the brand, right, but they're gonna take their percentage, and so what you get broken down to is the RPM. And so the CPM might be twenty five dollars, right, but by the time you get to you it's fourteen twenty five and that's what you're gonna get paid.

Speaker 5

It's like, wait, what what happened?

Speaker 4

Yeah, it's like it's like the trip, like like the transaction to your ticket master.

Speaker 3

That so I would I would recommend for any podcast if you're trying to structure your deal with a company, you just say, this is what I want to get paid per episode. That makes the negotiate based off of that, because once you get in the CPM game, and once you get in, okay, you got to hit this certain amount of numbers and a certain amount of downloads and dah da da da, and then you're gonna be doing forever.

Speaker 4

That makes sense too, that CPM and kind of make the water blurry. But it's people that swear by the CPM.

Speaker 3

Game because it's traditional model. This is what they this is what they set as a standard for the industry. But there is no industry standing because we don't know anything that's happening.

Speaker 4

See the industry, I'm playing both games, like I'm playing subscription model game, I'm playing live show sponsorship ad game.

Speaker 3

You know what I'm saying, how's Patreon working out?

Speaker 4

It's doing good, man, It's because I haven't been as see, when I took the deal, I come from behind the paywall.

Speaker 5

And say, hold on, I got to focus on get some shit.

Speaker 4

Out there, help brand bill while we and it fluctuate kind of went down because you got to be This is one thing I do give Joe credit for. You have to be diligent fucking with them paying customers. It's a different relationship, right. See, you have people that have relationship with their customer. All they ever gonna fuck with you is for the free. They don't even fuck with you outside of the free. That's what I'm saying. When you able to pull people behind the curtain, come on

back here. Why it caught you something? You gotta be diligent and feeding them there and they want that takes.

Speaker 6

Man.

Speaker 5

Just think about this.

Speaker 4

They paying me twenty five dollars, ten dollars, some people fifty dollar.

Speaker 5

They give Netflix twelve and they load them down. I'm talking about this. Some of the best quality of shit that you ever gonna see. But here's the other part of that.

Speaker 6

At some point point, there's going to be a comment or there's going to be an email that's gonna come to you, and it's going to be like completely like tearing the company down because you didn't put out an episode one week and in your mind you're like, this is worth twenty five hours, twenty five hours, and this is what I'm dealing with. Wow, So like we gotta deal with that. Like people don't talk about that side, but that's part of it.

Speaker 5

They don't even the mental strain of even the comments section. When this shit.

Speaker 4

Costs money to run and you ain't a lot of times it's the free bridge.

Speaker 5

They do all of that.

Speaker 1

An illegal alien from Guatemala charged with raping a child in Massachusetts. An MS thirteen gang member from El Salvador accused of murdering a Texas man of Venezuelan charged with filming and selling child pornography in Michigan. These are just some of the heinous migrant criminals caught because of President

Donald J. Trump's leadership. I'm Christinoman, the United States Secretary of Homeland Security under President Trump, did illegal border crossings are at the lowest levels ever recorded, and over one hundred thousand illegal aliens have been arrested. If you are here illegally, your next you will be fine nearly one thousand dollars a day, imprisoned, and deported. You will never return. But if you register using our CBP home app and leave now, you could be allowed to return legally. Do

what's right, leave now. Under President Trump America's laws, border and families will be protected.

Speaker 2

Sponsored by the United States Department of Homeland Security,

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