The Economics Of Podcasting

Nielsen Analytics reports about 6 percent of American adults, or about 9 million web users, have downloaded at least one podcast in the past 30 days.

Thirty-eight percent of those downloaders note that as a result of the downloads they are listening less to radio.

"While essentially still in nascent form, podcasts offer free audio and video content that is inexpensive to create, easy to access and on a portable platform that has already reached mass distribution. This exciting new medium has only just begun to stretch its legs," said Larry Gerbrandt, general manager and senior vice president of Nielsen Analytics

The most successful podcasts are garnering as many as two million downloads a month.

One popular podcast, the Mommycast Podcast Series, with content directed specifically at women, inked an advertising deal this year with the Dixie Paper Company worth more than $100,000.

Advertisements on Mommycast are embedded in the podcast, a strategy that advertisers may need in order to keep listeners from fast-forwarding over their messages.

The survey notes that 60% of listeners fast-forward over commericals.

Big brands Sony Pictures, Shell Oil, Earthlink, HP and HBO consider this new medium a viable advertising outlet.

The average length of the podcasts being listened to was 44 minutes. This may change with the growing popularity of video podcasts, which generally tend to be shorter, said Gerbrandt.

Some 72% of respondents who regularly download podcasts say they download an average of one to three podcasts per week.

About 10% of all podcast downloaders could be characterized as "heavy users", downloading 8 or more podcasts a week.

Podcast producers include:

1. Cable and broadcast networks converting episodes of some of their linear programs as previews and promotions.

2. Movie studios marketing films and DVDs, such as a recent podcast promoting Paramount's Nacho Libre that features its star, Jack Black.

3. Financial service firms, such as McDonald Investments and The Motley Fool, offer free podcasts on a variety of finance-related subjects.

4. The online travel agency, Orbitz, offers audio descriptions of travel destinations as a marketing tool.

5. Professors are making their lectures and class notes available as podcasts.

"For podcasting to reach its full potential, we will have to find the best ways to keep track of its audiences," added Gerbrandt. "That means developing accurate and comprehensive metrics that will allow podcast producers, distributors and advertisers to answer questions like: ‘Who are we reaching?’ ‘With what kinds of content?’ ‘When and how often?’”

To that end, Nielsen Media Research, as part of its recently announced Anywhere Anytime Media Measurement (A2M2) initiative, is launching several projects that will explore how best to collect and measure podcasting data.

From NielsenMedia.com