Index of making money with podcasting

Wizzard Software, the parent company of Liberated Syndication and several podcast hosting services, announced today that revenues for the fourth quarter of 2007 were $1,540,992, a 108% increase over revenues of $739,551 in the fourth quarter of 2006.

For the full year of 2007, the Company recorded revenues of $5,163,491, a 75% increase of $2,195,967 from revenues of $2,943,578 in 2006. Wizzard posted a gross profit of $1,562,703, a 47% increase versus a gross profit of $1,064,115 in the full year 2006.

The company noted several podcasting-related accomplishments in its announcement:

• Acquisition of Podcast Company Liberated Syndication (Libsyn) 3/19/07
• Completed Raise of $7,500,000 for its Podcasting Business 7/9/07
• Adds Nielsen//NetRatings’ Site Census to Advertising System 9/12/07
• Announces Largest Ever Industry Ad Campaign 11/14/07
• Ends Year with Approximately 10,000 Podcast Publishers 12/31/07
• 1 Billion Download Requests in 2007 12/31/07

In 2007, Wizzard Media surpassed download request forecasts with one billion podcast download requests achieved, surpassing the 450 million download requests for 2006.

“Podcasting is becoming a necessary audience expansion tool for content publishers and brand advertisers seeking cost effective, high return outlets to capture the migration of audiences from traditional media outlets to the internet,” says Chris Spencer, Wizzard CEO. “We are seeing an increase in advertiser understanding of the high quality, subscription and episodic benefits of podcasting versus other internet video offerings. We believe that our ambitious undertaking of targeting similar audiences through interesting, engaging podcast micro-communities is a very compelling advertising opportunity and we expect advertising revenues to grow substantially in 2008.”

If you’re trying to make money with new media, IDC has some good news for you.

U.S. Internet advertising is growing like mad - up by 25% in 2007 to over 25 billion dollars. And the money’s not all going to Google.
Research Highlights: 

• As people spend more time on the Internet, companies are moving their advertising dollars from traditional media to online media.
• Total U.S. Internet ad spending in the fourth quarter of 2007 (4Q07) grew nearly 28% over the same quarter in 2006 to $7.3 billion.
• Google’s net U.S. market share declined for the first time in two years due to slower growth in domestic fourth quarter sales. The market leader’s net U.S. Internet advertising market share was down 0.5 percentage points to 23.7% last quarter compared to 3Q07.

“If a merger between Microsoft’s new media business and Yahoo! would come to pass, the combined entity would have a net U.S. advertising market share of about 17% based on our 4Q07 data,” says IDC’s Karsten Weide. “It would not quite bring Microsoft-Yahoo! to where Google is in online advertising in the U. S., but it would give them a much better fighting chance than if they went it alone.”

Mark Linder, the creator of the Bedtime Stories My Kids Love podcast, has reached an agreement with the newly formed PodShow Press to publish in both audio and print form his first book of bedtime stories, The Adventures of the Man in the Can.

The new work is a collection of stories about a character named The Man in the Can and comes from the Bedtime Stories My Kids Love podcast.

“The Man in the Can is one of Bedtime Stories My Kids Love most beloved characters,” says Linder. “The tiny man always seems to find himself in impossible situations and somehow, through his ingenuity, steadfastness and the help of his animal and bird friends, always seems to find a way to persevere.”

The printed version of the book is scheduled for release later this year. The first audio book chapter of the series is available now for listening.

There’s been a lot of discussion lately in the world of new media about the future of podcasting - people wondering what the current state of podcasting is and where it’s going.

eMarketer forecasts that the audience for podcast consumption will double in the next two years, but even that relatively rosy forecast is disappointing to some.

We recently talked to Chris Spencer, CEO of podcasting hosting mega-network Wizzard Media, to get his perspective on podcasting and its future.

In the last year, Wizzard has acquired podcast hosting services Switchpod, Libsyn, and Blast Podcast. Wizzard made headlines in January when it announced that it had delivered over one billion podcast downloads in 2007. Earlier this week, Wizzard announced that it was now trading on the American Stock Exchange (”AMEX”) under the ticker symbol “WZE.”

In our interview, Chris shared his thoughts on what a billion podcast downloads per year means, what he expects that number to be in 2008, and his predictions on what will happen with podcast advertising.

Elisabeth McLaury Lewin: Tell me about this whole billion downloads number. What does that mean for you in particular, and for downloadable media industry in general?

Chris Spencer: It’s a big number, isn’t it?

For us in particular, it means our servers are running well. Let’s face it: some people wonder whether this accomplishment gets credited to Wizzard, or to our content creators. We feel strongly that it’s 95% our content creators - they create the quality content, and they go out and market their show, and grow their audience. We get 5% credit for being proficient and productive enough to offer a stable inexpensive hosting solution, and that takes a lot of work.

But it comes down to the podcast producers. It’s a big accomplishment for the podcasters we host. It’s a big enough milestone for them and for us, and we publicized it so much.

In reality, what we’re trying to do is raise awareness for podcasting, specifically with the advertisers and the sponsors. It’s a number that’s going to attract a lot of the bigger brands that didn’t realize how big the potential here is. If there’s going to be big audience for podcasts, then that’s going to draw advertisers. That’s why we publicize it, not just for us, but for the whole industry.

Let’s look at the whole podcast industry: Right now, the industry is too small to worry if it’s us, or PodShow, or Podomatic. Right now it’s all about getting the advertisers and sponsors to know more about and be more interested in podcasting. Period.

I could talk about this for hours: it comes down to trying to demonstrate that this is a viable alternative to reach target audiences. More importantly, it is a product that people are consuming, and they’re loving it.

Podcast hosting network Wizzard Media announced this morning that its common shares are set to begin trading today on the American Stock Exchange (”AMEX”) under the ticker symbol “WZE.” Previously, the company traded as “WIZD” on the Over-the-Counter Bulletin Board.

Wizzard is based in Pittsburgh, Pennsylvania, with offices in New York, Los Angeles, and Detroit, and was in the headlines last month for its disclosure that it had served up one billion podcast downloads in 2007. Additionally, Wizzard recently completed a major podcast advertising campaign for the U.S. Navy, across 28 of the podcast shows it hosts on its network.

Howcast Media announced the launch of its new site today, a venue for watching and sharing “instructional how-to” videos. Howcast, founded by veterans of Google and YouTube, also announced a directors’ program for “emerging filmmakers” to pad out video offerings on the site.

Howcast paints itself as a hybrid of “user-generated content with the quality of a professional video studio.” Content includes topics randing from How to Paint a Wall, to How to Get Paid for Donating Plasma, to How Not to Get Mugged, and so on.

“Online video is generally split into two worlds: user-generated content and professional studio content,” said Jason Liebman, CEO and co-founder of Howcast. “We think there’s an opportunity to bridge these worlds, and instructional video is a perfect place to start. Our viewers can suggest topics and content for videos on any subject they’d like to learn about, no matter how unique. Through our [New York-based] Howcast studio and our directors’ program, filmmakers can take all of these great user ideas and turn them into high-quality, engaging videos.”

Howcast.com invites video producers to contribute “what they know and love” by suggesting new video topics, creating and editing how-to text guides, and uploading videos. They also are soliciting “emerging filmmakers” to join their Howcast Directors’ Program, offering them an opportunity to “gain experience, exposure, and income” by creating how-to videos.

On a side note, George Smyth has been producing the highly entertaining “One Minute How To” podcast for several years, in which he invites guests to distill, in sixty seconds, the essence of how to do something. Topics range widely, from the recent “How To Make a Studio Alien Voodoo Head,” to playing blues harmonica, or one I did on homeschooling.

Today’s big podcasting news is that Wizzard Media announced their download totals for 2007, an amazing one billion podcast files downloaded. To put that large number into some context, we talked with Rob Walch, Wizzard’s Vice President of Podcaster Relations (and creator/host of the popular Podcast411).

First off, congratulations - this is pretty stunning news. What do you think this billion-download figure means, for Wizzard Media in particular, and for the wider downloadable media industry in general?

To my knowledge we are the first ones to hit a billion in a calendar year in the Podcasting space (wearing my 411 hat). I am sure there will be others — if not in 2008 then certainly in 2009.

But the bigger news for podcasting is that someone has done it. I believe that hitting that the 1 billion mark is the type of benchmark that big ad agencies will take notice of. Now they’ll understand that podcasting is for real — and that is good for everyone.

So, when we were at the Portable and New Media Expo this fall, some guys were talking gloom and doom — that podcasting was essentially dead. Your news seems to belie that prediction.

There is a lot of misguided talk about podcasting being dead. We just are not seeing it. We continue to see growth in the numbers each month. To us, at least, podcasting keeps growing.

What do you think this bodes for the coming year?

We hope that 2008 will be the year that advertisers stop thinking of podcasting as an experiment, and start thinking of it as a necessity for every campaign.

The Association For Downloadable Media (ADM), a newly-formed organization dedicated to “providing standards for advertising and audience measurement for episodic and downloadable media,” announced today the election results for the 20 positions on its board.

Podcasting News Publisher Elisabeth McLaury Lewin talked with some of the newly-elected board members and committee heads, asking about what inspired their involvement in the ADM, as well as their goals for the coming year on the ADM board. Here’s what they had to say:

Risto Koski, Multimedia/ Nokia Music and Podcasting: “In order to get the downloadable media ecosystem to work properly: participation of all industry players is needed: the publishers, aggregators, advertisers and distributing media. This goes naturally beyond North American market from which most ADM members are coming from.

I see the importance of media industry working for standards. Without standards which should based on the true technological capabilities for content and advertising – there will be scattered groups of companies trying to push out proprietary solutions with only limited audience reach for the publishers and advertisers.

Another important issue : without proper measurement standards not only for online (pc/ Mac) – much standardization work is also needed for the ever more focused portable devices. Especially connected, mobile handsets which increasingly offer access to internet media directly through wifi, wimax and 3G/ Edge. I believe these portable devices and mobiles are clearly breaking traditional roles and delivering more control to the user.

My perspective is the next generation of downloadable media: open source and global through the portability and mobility – offering the user the freedom of choice for time and place to create, share and consume content on the go as a part of daily social life.”

Kent Nichols, Ask A Ninja: “The more standardization in the terms of ad units, the less confusion there will be amongst buyers. The less they are confused the more they will buy.

I hope to bring a sense of clarity and cut through the BS that surrounds the industry right now. Form a consensus about which ad formats are working now and what type of measurement is going to be the standard.

And do it from a small publisher’s prospective (I know that seems odd for me to say, but even though AskANinja serves millions of videos a month, we’re still a blip compared to mainstream media).”

Rob Greenlee, (Microsoft) Zune Podcast Programming Lead: “I am hoping to help pull the podcast industry together to develop sponsorship format standards, and help educate existing and future podcasters about all aspects of podcasting. My strongest interest is in industry-wide standards in the implementation of XML-based syndication feeds (RSS & Atom). I also have an interest in marketing and promoting new and unique podcast content to everyday viewers and listeners around the world.”

Jim Louderback, Revision 3 CEO: “We need to legitimize ourselves as an industry and come up with standards around reporting metrics, viewership metrics and ad inventory units. I’m looking forward to working with the board and the rest of the industry to come up with these standards so we can hasten the movement of dollars from traditional TV to online media.

We also need to do a better job helping viewers wade through the monumental amount of dreck out there, and to discover the really great stuff being produced. Discovery is also key, and I’m hoping we can help pioneer some unique ways to solve that problem too.”

Tim Street, creator of French Maid TV: “We need a marketplace for advertisers and online content producers to buy and sell video and audio advertising on the Internet. Without industry standards for downloadable media there will be no marketplace for downloadable media and without an organization like the ADM there will be no industry standards. It was either wait for someone else to do it or get some like minded people involved and do it ourselves.”

C.C. Chapman, The Advance Guard (and the popular music podcast Accident Hash): “I wanted to be part of the Advisory Board to insure that the ADM remembers everyone in the community, and not just big businesses. I hope that the ADM can help out everyone who wants to take their podcast to the next level by monetizing it in some form. I know that isn’t for everyone, but for anyone who wants that, I hope the ADM can help.

As a marketing professional, I’m also hoping that we can bring podcasting to a new level of acceptance as a viable medium for advertisers and brands to use in their campaigns. Right now it is not much more then a buzzword to most of them and I want to help change that!”

Rob Walch, Wizzard Media executive and Podcast411 creator, was elected Chairman of the Education and Outreach Committee: “I have felt an organization like the ADM has been needed in podcasting for quite some time now. When the ADM was announced and I saw the companies involved, and their goals, I felt it was a good thing for podcasting.

Being involved from my perspective is a way for me to pass on to listen[ers] to my show on what is happening in the ADM, and also to get feedback from my listeners to pass back to the ADM. Whether or not a podcaster is a member I am very interested to hear their thoughts and opinions and share them with those in the ADM.

My plans and goals for the ADM are to help get the word out about the great content that is available as a podcast. I also want to help recruit advertising agencies to become part of the ADM.

Essentially it’s a two prong approach - educate potential subscribers and potential advertisers about our medium. To do that, I hope to recruit into the Education and Outreach committee those that are most passionate and informed about our medium.

I welcome anyone who is part of the ADM to contact me if they want to be part of this committee. And for those not yet part of the ADM, please consider joining and actively participating.”

Nascent new media industry group, the Association for Downloadable Media, has announced the new officers, committee chairmen, and Advisory Board members. Podcasting News Publisher Elisabeth McLaury Lewin talked with some of the newly-elected board members this weekend.

Here’s what Chris MacDonald, (Executive VP, Business Development and Operations, Libsyn PRO), Chairman (looking chairmanly in this updated photo, right) had to say about his plans and goals for the ADM, and what moved him to become involved in the new organization:

“[Over the last several years], I wanted to start up a conversation with other podcasters and new media creators, stemming from talks with folks at different PodCamps and industry gatherings. I saw a real unmet need for having replicable standards and metrics – not in terms of this one particular company or this one existing sort of metric being incorrect – more like, how do we craft the language and the matrix and the variety of different ways that value can be applied from a monetization strategy? We came to the conclusion that a lot of it was gonna happen on an ad-supported basis, and that would be a conversation worth having as a group.

“I heard from Susan Bratton [ADM Vice-Chairwoman] around that same time, and she was interested in getting a little more formal, like a trade association, and wondered would I like to be involved. I jumped at the opportunity to do this – because it seemed to be the sort of environment that would kick-start this metrics and monetization conversation, and translate it into something concrete. It takes money, coordination, research, many people, a structure, to get these conversations going, and this seemed like a great way to mobilize all these things.

“[The ADM] We have members and officers from all corners of the industry — large broadcasters, independent publishers, large publishers, small and medium-sized companies, nonprofit and for profit ventures, individuals and corporations… a variety of different stakeholders who are attracted to the concept of getting together and sharing information, and bridging the gap that we all know exists between getting advertisers more excited, and growing the industry for all the stakeholders.

“The industry is growing up and we’re at this place right now where it’s making an undulation. There’s definitely money to be made, but how? We’re becoming legitimate in the eyes of older media and advertising. And there have been some interesting strategic directions for communication that help to create a lot of value for advertisers. But, for those of us who are the “experts,” the people who’ve been doing downloadable media for several years now, what do we do with all this sweat equity knowledge we have? And how do we start to communicate as a community?

What’s Next For The ADM

“I think the thing we have to do first [now that the ADM elections are decided], is some of the organizational stuff, to help us get up and rolling. Subject-matter work at the committee level… We now have committee heads, so the work of the committees can get started in earnest.

“What I’d like to see happen in the coming year at ADM: We have a good base of corporate and non-profit and individual members. And I expect that we will spend a lot of time, getting that membership base even broader and stronger, so our potential resources will increase. Frankly, when you’re concerned with what we’re going to be doing, things like primary research, being the focal point for press inquiries about issues of donloadable media, pulling together our diverse collective interests and supporting those, we’ll have to figure out financing and prioritizing our collective goals.

“We also have to talk with advertisers and figure out what they really want and need, before we begin to build a structure for collecting information and doing research about the reach of providers of downloadable media.

“The ADM is a unique organization, in the sense that we’re not “vertical”, not a trade association per se, but rather we’re a group for solving complex problems. The needs of independent publishers might be different from an advertising-repping company or a measurement company. One of our first things will be to come up with some ways we can work collectively.

“You can expect some very hard work from from the ADM board in the months to come, and people are gonna be hearing from us soon. If someone’s been sitting on the fence, wondering whether to get involved in the ADM, I really encourage them to come to downloadable media.org. Look around the site, and see what we’re about. I invite you to become members, and get involved, and join the conversation. Pick out and work on a committee with the subject matter that appeals to you.”

Dave Winer, creator of the RSS 2.0 standard on which podcasting is based, offers some interesting comments on the state of podcasting at his blog:

“What if the energy that went into Chumby, for example, went into designing a podcast player? The player might actually look more like Chumby than it does an iPod. The interesting thing about the Chumby is that it is connected but not tethered to the network. The ideal podcast player would be even more loosely connected.

1. It would directly read its feeds over wifi, it would not have to synch through a desktop or laptop computer. The iPhone has enough connectivity to do this. The iPod Touch does. A Nokia N800 does as well. Most cell phones do.
2. You could use it to create a podcast. We’re basically there with Twittergram and BlogTalkRadio. Just call a number, and we not only shoot your minicast at Twitter but we also maintain an RSS 2.0 with enclosures feed. In other words, in every way, it’s a podcast.
3. It must be open, so users can have a range of choices of catcher software. I don’t think a one-vendor approach has a chance of working.

When we get this device, podcasting will work better.”

He also responds to people suggesting that podcasting hasn’t achieved its promise:

“A lot of people hoped they could make podcasts and quit their day jobs. I wasn’t one of those people, and I never encouraged people to believe that. I see podcasting, for bloggers, as just another way to communicate with a few people who are interested in what they know and think. I also see it as a way for professional news organizations, esp non-profits, to flow reports to people in a very convenient and powerful way. As a consumer of podcasts, I am in heaven. I am a regular listener of: Meet the Press, Face the Nation, This Week, Fresh Air, Nightline, NYT Tech Talk, and numerous NPR shows. I have far more content than I have time to listen. Thanks to podcasting I am a much better informed person, and it gives my mind something to do as I get my exercise.”

While Winer hasn’t hyped the idea that podcasters would be able to quit their day jobs, it’s happening anyway. Just like a small percentage of the people blogging have been able to turn their blogs into careers, a small percentage of the people podcasting have been able to turn their podcasts into careers.

For a few examples, check out the article Secrets of Viral Video Hits, or listen to Elisabeth’s interview with the Ask A Ninja guys. People are beginning to make their livings from podcasting - it just takes talent, a great idea and a lot of hard work.