Podcasting is getting huge. Here's why.

Serial, one of the most popular podcasts of all time, returned last week with an episode chronicling the capture of Bowe Bergdahl, a US service member imprisoned for five years by the Taliban.

The show’s first season — a deeply researched reinvestigation of the 1999 murder of Hae Min Lee, a Baltimore teenager, and the subsequent trial and conviction of her ex-boyfriend, Adnan Syed — put podcasting on the map. Host Sarah Koenig, long of This American Life, narrated lengthy, penetrating interviews with Syed himself, speaking from prison, as well as painstaking recapitulations of every detail of evidence and testimony.

It made for gripping storytelling, and listeners ate it up. As of March of this year, the show’s first season’s 12 episodes had been downloaded a total of 75 million times. And that was part of a broader trend: Podcasting is becoming a mainstream phenomenon.

About 17 percent of Americans 12 or older, about 46 million people, listened to a podcast in the past month, up from 12 percent in 2013.

The medium is taking off now because of the happy convergence of three big trends. The technology has finally improved enough that listening to podcasts is easy and convenient for ordinary listeners. Talented professionals — many of them veterans of NPR or other radio outlets — have begun to focus on the medium. And a new generation of podcast-focused businesses are figuring out how to convert these professionally produced, popular podcasts into serious money.

Technology has finally made it easy to listen to podcasts

The old and busted way to listen to podcasts. (raneko)

Podcasting has been around for about a decade — the term is a reference to the iPod, which older readers will remember as an iPhone that only played music. But while the idea of listening to music on an iPod quickly became popular, it’s taken a lot longer for the concept of listening to podcasts to catch on.

A big reason for this is that downloading podcasts to an iPod or other MP3 player was cumbersome. Typically, you had to subscribe to podcasts on your computer, download episodes, transfer the episodes over to your iPod player using a USB cable, and then listen to the episodes on your iPod.

And you’d have to repeat this ritual every time new episodes came out, which might happen every day, week, or longer. Most users simply didn’t have the patience for this. Some people listened on their computer; many didn’t listen at all.

The wide adoption of smartphones with mobile internet capabilities, beginning around 2010, removed these hurdles. Only 10 percent of Americans owned smartphones in 2009. This year, that number has jumped to 71 percent. Fans gained the power to tune in to podcasts much like they tuned in to radio shows, instantly, wherever they happened to be.

New software platforms like Stitcher, Overcast, and Castro, along with Apple's own undeletable Podcasts app, have emerged in recent years, making the process of aggregating, downloading, and streaming podcasts even easier.

Podcast listeners have migrated to mobile in droves. In just one year, from 2013 to 2014, the percentage of listeners who said they primarily listen on smartphones, tablets, and portable audio players rather than on a computer jumped from 34 percent to 51 percent.

It’s becoming a lot easier to listen to podcasts in the car

(Charles Wiriawan)

The thing that’s really driven the widespread adoption, though, has been new technologies that make it easier to listen to podcasts in your car.

The market for in-car audio programming is huge. A disproportionate share of radio listening — about 44 percent — takes place in cars, compared with about 29 percent at home and 15 percent at work. More than 50 million Americans each week tune in to news-talk radio stations, which offer programming that sounds a lot like what you can find on many podcasts. Programs like The Rush Limbaugh Show and NPR's Morning Edition draw millions of listeners every day, and have done so for decades.

So you might have expected podcasts to disrupt the talk radio market the way digital music disrupted the record labels. But until recently, that wasn’t happening because — again — the technology was too cumbersome.

Driving with headphones is a bad idea no matter how smart your phone is. Would-be listeners could use tape-deck adaptors or digital transmitters, but both cost extra, were a hassle to use, and could mangle the audio quality.

But in recent years, carmakers have made it a lot easier to pipe audio from customers’ smartphones to their stereo systems. Carmakers added auxiliary audio inputs, then USB ports (which had the added benefit of charging your device). More recently, they’ve begun adding support for Bluetooth, which allows you to play podcasts from your smartphone without even taking it out of your pocket or purse.

Tech giants such as Google and Apple are investing heavily in the development of "connected car" platforms, which allow smartphones to totally take over the interface of cars’ in-dash entertainment consoles. One consequence of this is that listening to podcasts in your car is becoming as easy as listening to AM or FM radio.

Podcasting is becoming professionalized

Many early podcasts were amateur efforts; others were simply on-demand versions of radio programs produced by major outlets such as National Public Radio or BBC Radio. But recently, there’s been a new wave of professional, dedicated podcasters making shows with the same high production values you hear on the radio.

Serial’s Koenig is only the most famous example. Another This American Life vet, Alex Blumberg, co-founded NPR’s Planet Money podcast, and, more recently, created StartUp, a podcast chronicling the rise of a podcast network, Gimlet Media, that he co-founded with another former NPR producer, Matt Lieber.

Carmakers have made it a lot easier to pipe audio from customers’ smartphones to their stereo systems

The host of Gimlet's Mystery Show, Starlee Kine, is also a This American Life alum. The hosts of its Reply All, Alex Goldman and P.J. Vogt, were once producers at On the Media, and were hosts of its short-lived spinoff podcast TLDR. Roman Mars, host of 99% Invisible and founder of the PRX's Radiotopia podcast network, is also a public radio vet.

Other successful podcasters — such as Marc Maron, host of WTF, and Joe Rogan of The Joe Rogan Experience ­­— got their start in standup comedy, TV, commercial radio, or all the above.

Major media outlets have also jumped in with more conviction than before. Slate recently brought its various podcasts together under an umbrella organization called Panoply, whose owners recently bought a stake in Gimlet as well. Public Radio International and American Public Media have both recently launched networks as well, called SoundWorks and Infinite Guest, respectively.

Podcasting has a viable business model

Alex Blumberg and Matt Lieber, co-founders of Gimlet Media. (Yana Paskova/the Washington Post via Getty Images)

One reason the medium has been able to recruit so much talent recently is that podcasts are making money. Many podcast hosts, like some radio hosts, read or even write their own ads. Listeners connect with a host's voice and personality in a deeper and more intimate way than, say, the readers of newspapers or magazines or their web equivalents.

And talented podcasters are often talented admakers. A Mailchimp spot that aired during Serial — which featured a tourist mispronouncing the company's name ("Mail ... kimp?") — became a bona fide web phenomenon in its own right.

Podcast ads are lucrative. As of late last year, podcasters reported CPMs — cost per a thousand ad impressions, the standard industry metric — of between $20 and $45. Network TV programs, for comparison, earned about $5 to $20 per thousand impressions, radio ads made between $1 and $18 per thousand, and regular web ads between $1 and $20.

Those kinds of numbers have attracted a bit of a gold rush to the podcasting business.

Slate’s Panoply network produces podcasts, but it also offers distribution, sales, and audience development services.

Many shows on its 58-podcast roster are long-running Slate staples —such as the Political Gabfest and Culture Gabfest. Others are made in partnership with outside news organizations, such as the New York Times, New York Magazine, and Popular Science, which are choosing to take advantage of the platform Panoply offers rather than develop their own podcasting operations from scratch. (Vox’s own The Weeds podcast debuted on the network in September).

Gimlet Media — the startup featured in season one of StartUp — is, at least for now, a smaller operation, with just four shows in production. But its founder’s reputation and his idea of the company as an "HBO for podcasts" have attracted keen interest from investors.

Chris Sacca, an early backer of Twitter and Uber, was one of the first investors in the company. Just this month, Gimlet raised $6 million in Series A financing round that valued it at $30 million. Of that, $5 million came from Panoply’s parent company, Graham Holdings, former owner of the Washington Post.

The latest investment — discussed at length in a recent StartUp episode — will allow the company to add eight new shows and triple its headcount from 25 to 75 employees.

Podcasts may not replace radio talk any time soon. Live radio, live TV, and their streaming equivalents seem likely to dominate key niches like breaking news and sports into the future.

But smartphones and car integration mean podcasts will finally exist right beside radio, giving many more listeners a chance to choose between them. Some of radio’s top producers — along with some savvy investors — are betting they’ll choose podcasts more often.

Correction: This story originally misidentified This American Life as a National Public Radio program. It's actually produced by WBEZ and distributed by the Public Radio Exchange.

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