Upgrade - 89: Can We Use a Tracking Pixel?

Episode Date: May 16, 2016

By popular demand, Jason and Myke talk a bit more about the business of podcasting, as they’re joined by podcaster and podcast ad sales executive Lex Friedman. We also analyze Apple’s investment in a Chinese ride-sharing service and what that means for the company’s future directions.

from relay fm this is upgrade episode number 89 today's show is brought to you very kindly by our friends over at fresh books and mail route my name is mike hurley and i am joined over on the other side of the globe by mr jason snell hi Hi, Mike. I saw a funny thing that was going around, a meme that was something about people who believe in the Earth is flat. And the line was something like, there are members of the Flat Earth Society all around the globe. No, you're doing it wrong. No, no, you can't, no.

Would it be across, I guess, right? All across the flat plain that is the earth, riding on the back of a turtle. How are you, sir? Are you doing well today, except for this crazy meme you found? It's Monday morning. You know, it is a pleasure to spend my Monday morning with you and the listeners. Of course, you're listening whenever, but you're hearing Monday morning me when you hear Upgrade, usually. And it's good. Like I always say, it's a good start to the week.

I stay up late watching Game of Thrones on Sunday nights, so I've got to have a little more tea and try to wake up. But having kids in my house makes it easier to wake up because if I was just like you, right? You don't have a lot of people in your house who are on a normal human schedule. You've got one. For me, having the kids, you know, my daughter has to be up and moving around before seven o'clock, really, and my son, not too long after that. And so I could be one of those people who has a really weird schedule and sleeps until 11am and all of that. But I can't because, you know, not only do I have the kids have to get out fairly early, and then Lauren has to get out fairly early and then Lauren has to get out right about now. But, you know, also the dog, whenever it's light out, the dog decides now is the time to come and lick my face and demand that I feed her. I got to train her out of that.

But so, yeah. So in the end, it's, you know, I dream of being one of those people who can wake up at 11 in the morning and get about their business, but I am never going to be one of those people. So good morning is what I'm saying. We have a big show today. So we had an overwhelming amount of feedback that people wanted to hear more about kind of the business side of podcasting. Yeah, how the sausage is made apparently is the thing that we're talking about now. So we've got a lot of that today. We have a lot of follow-up, but also later in the show, we're going about now so we've got a lot of that today we have a lot of follow-up but also later in the show we're going to be joined by uh mr lex friedman

you may know lex he has is the host of many podcasts including turning his car around and he's also uh i wouldn't know how to describe him we'll get him to describe himself but he works for midroll media um working on their advertising so yes uh midroll is a huge uh podcast advertising company that kind of provides advertising to many many huge podcasts including stuff like the mark maron show yeah so he is really in that world of leading podcast professionals so we want to get lex's's thoughts and opinions on this whole data and discussion that we had from last week. So that's coming up a little later on in the show. But first off, I want to kind of go through some thoughts, some additional thoughts that I've had and to kind

of clarify some points from last week based on listener feedback. So I wanted to kind of go through a few things about data with you, Jason, so we can talk about that. So I've got a few questions that we can answer. So question number one is, what is the data that we do not want Apple to give to all podcasters, including us and everybody else? Right. And we should say there's no evidence that Apple's going to give this data. The New York Times story that set this off was sort of about people complaining that Apple isn't doing enough, making enough of an effort to gather data.

Yeah, and quite frankly, as the week has gone on and more people are talking about this and less people are coming forward to say anything, it really does seem to me that a lot of that article maybe isn't exactly how it seems. Yeah, I think that's probably true. And I also, something that tends to happen on the internet is your arguments get flattened into this very basic polar opposite kind of argument. And I think that's one of the reasons

we want to follow up a little bit about here is there's, I've seen some people suggest that what we are saying and other people are saying is that we don't think that there's a place for data in podcasting. And that's not really true. So what's the data, from your perspective, Mike, what's the data that you don't want Apple to give? I really don't want Apple to take Apple IDs, iCloud IDs, and use the information that they know about the people behind those and attach them to the shows that they listen to, even in an anonymized way. I think there's very basic information that is fine, right? So like maybe the stuff that we'd want to give is information about the listening of the show, right? I can see why some people would want to

know that and we'll get into that in a minute. But the actual data about the individuals, I don't think that that data should be given unless somebody specifically wants to do it like through surveys or something you know like a listener opts in to give that information they say like i am female i am 25 years old i earn this amount of money i live in this part of the world uh i don't think apple should be providing that information without explicit opt-in from the listener so really Apple shouldn't be involved in this at all there should be the podcasters themselves should create surveys as many do if they want to get that information I don't think that that stuff should be taken from what would be people's iCloud IDs and given out because also

that frankly doesn't feel like something that fits with Apple's core value. So I don't, and I don't think that, you know, we'll get into this later with Lex, I'm sure, but I personally don't believe that that information is necessary for the type of advertising that we have been doing for years and has been in the podcast industry for over 10 years now. Right, it's that user tracking and the ability to, yeah, I mean, it's essentially,

I think what is suggested in that article is that they want web-style tracking where they can place, and this is where it breaks down from a technological standpoint, is like,

what they want to do is place markers on a file somehow and have it be that this is where the ad is. And please give us, you know, give us information about this and let us have a unique identifier for these people and send this back to us as we go. And you kind of would need to build an entire infrastructure around tracking to do that. And that's where it breaks down for me is I don't think Apple is

interested in building an infrastructure around tracking based on the contents of your MP3 files. Which is not to say that not just Apple, but podcast app makers in general couldn't generate more data for their podcasters. Although there are still challenges there. still challenges there. Like if you're Marco Arment, how do you verify that somebody is the owner of a podcast in order to give them access to their personal data? Because you're not going to give all data to everyone, are you? That seems a little bit far-fetched. Apple, because it's got a directory, does have an advantage there that people have signed up essentially and submitted their podcast. And so it's tied to an Apple ID. But, but more broadly, there is, you know, there is data that anybody who makes a podcast app could generate if they wanted to, and it could be as aggregate or as anonymized as,

as they want it, they want it to be. Now, I'm not sure I want people measuring all of this data either. And I'm not sure how useful it would be. But there are definitely data that you could get around people listening to shows because the we should mention ATP talked about this this week in ATP 169. And they recommended us so we should probably recommend their conversation about it. They all to close the loop. They all snake around together. Butco talked about this a little bit and it's the idea that right now the way podcasting works it's an rss feed you see the feed gets updated says there's a new episode here's the download link and your and your rss or your podcast app says okay and it goes and it downloads it and so you get download stats

you get uh you get download stats that uh that are um very much like web file stats. You get an IP address and what client it was and some very basic stuff. And that's the end of the conversation. That's the end of it. to measure does that episode ever get played right does anybody how many times did that episode actually have somebody press play and begin the playing of audio you could also have an abandonment point like you could measure after again it gets really complicated and how do you determine this but you could say the average play you know the average person or or got to this point or 50% of people reached this point or whatever. You could do that. So you could get the idea, which might be useful for podcasters if you do a three-hour podcast to realize that most people aren't listening past 45 minutes. It would be interesting.

That's possible. That would be good for advertisers to know where to put their ads is when people are listening. And you could go even deeper and say, do people skip audio in there? And even deeper would be, where do they skip audio? And are they skipping ads and all of that? You could go down the rabbit hole there. But every step you take, every, I guess, rung in the ladder down into the rabbit hole, I don't know, I've lost the metaphor here. It's more complicated the further you go, and the data is more complicated. And I can tell you from having a load of web data from my previous job, looking at all the data for PC World and Mac World and Tech Hive, that it's too much data. The data is usually not used particularly well by anybody.

So people talk a lot about collecting data, but I'm skeptical about how useful it would be. So Apple already have some data that they could turn into something without needing to lock the system down, right? So there are statistics that they are able to gather that could make things more useful for people if they were to display them in a good way. Like Apple will know if an episode is downloaded or streamed right don't they know if somebody subscribes they have that information they can get through their apps um they know broad geographical information so do libsyn are the hosts that we use they have that so like we know uh what state people are listening in and sometimes what city, depending on how big the city is.

Yeah. Feedpress has that too, which I use for some podcasts as well. And it's the same, you know, they're generally using a redirect. So when you try to download the episode, it logs that on the server and then sends you to download the episode. And it gathers a little bit of data by measuring that request. And that broad data is useful. So the geographical broad data helps me make decisions of advertisers. So I'm able to say to an advertiser, 60 to 70% of our listeners are based in the United States, which is really useful when we have a product that's US only. So that's, you know, but I feel like for me, that's as far as it needs to go in most instances. But,

you know, many people think differently differently we also can find out through libsyn which uh application or device is being used which is just i don't really think that's very useful but it's just an interesting tidbit i don't really know as much you can do with that apple could also kind of provide information on related shows so they know what you subscribe to right and they show like to on the store you know people that subscribe to this like this but they could maybe generate more graphs for people or maybe charts that kind of show the correlation between shows yeah yeah they could they could i don't know what you'd use that for right but i'm just thinking like these are the

data points that they have yeah so there's data. There's data around. I think that's one of the things that we mentioned briefly last week is there's data around. And I'm skeptical enough about the complexity of getting more data. And then I'm skeptical of whether that data really would get used in a good way. And I'm not saying in an evil way. I'm like in an effective way, because it's very hard to parse that data and understand what it all means. And if you've got different sources, then you can't really compare them. So that's problematic, too. Also, there are other sources of data. We've talked about some of them here. Let's also not forget things like

surveys. And you may think, well, surveys aren't data. That's you're asking people to tell you who they are and all that. And those can be skewed. It's true. That said, radio and television have used surveys to determine the life and death of every TV and radio show ever since the beginning of those two media, because that's how they've had to do it. And although now there are technological things involving DVRs and things like that, that are part of the mix, for years and years, the way the TV industry and the radio industry dealt with this is they had a panel of viewers or listeners, and they would measure them in their homes, or they would have them fill out surveys telling them what they watched, and they would use that to determine ratings. So Midroll does this, Lex's company. They have a demographic survey that they use.

It's not a per-episode listenership, but it's a demographic survey. You know, you basically can say, what's your age and race and profession and gender and have you ever bought things on a podcast and stuff like that. And it's optional. Not everybody has to fill it out. But they've used that to compile demographic data that lets them sell better to advertisers and lets advertisers target shows. They know if an advertiser is targeting menswear, they want to advertise on a show that skews male. And if there's somebody who's advertising a shaving product for women, let's say, that they want a thing that's going to be female skewed. And that data is their age and income and all sorts of data like that. You can collect that now. And although it might not be perfect, I would argue maybe none of this data is ever going to really be perfect. Yeah, my feeling about that stuff is the surveys are fine, because it's opt-in, right? This is just where it just starts to get a bit, what is your personal tastes? And I just don't like the idea of data being taken about our listeners without them

meaning for it to be or knowing that it is when for so long it hasn't been so like if you're if you're listening in google you're listening in spotify you're listening in stitcher you're giving that data right these services are created in a way that they are able to get more from you because they're locked down. And that's the idea, right? They don't use the RSS feeds. They have their own stores and they're able to learn a little bit more about you. But you're opting into that, you know, whether you read the terms of service or not.

But, you know, my whole thing is just not liking the idea of Apple changing it under people's feet. Yeah, and people don't understand that too. I actually heard from people. I heard from somebody yesterday who said, why aren't there incomparable episodes on stitcher anymore and the answer was i never submitted a comparable to stitcher and when somebody complained that there was something wrong with our uh feed on stitcher i wrote to stitcher and said take our feet off because i don't actually i can't actually measure listenership there. I have no access to their, whatever statistics they do have because I don't have an account there. And yet somehow my podcast

is in their system. So I asked them to take it out, but that person was like, well, you know, what about Stitcher? And the problem is that you, you risk in being in a situation where some, everybody's got, somebody said to me the other day, it's like, I don't want to have an Audible app for the Audible podcasts and a Howl app for the Midroll Howl podcasts and, you know, an Apple app for these Apple exclusive podcasts. And then a podcast app that gives me the free, you know, standard podcast. I don't, I don't want all those things. I want them all in one place. And that's one of the risks of doing something like this is, and I guess that's what they're saying in a way, the people in the New York Times article is, you know, basically, please, Apple, don't think it's going to happen because that's a whole lot of overhead and it totally changes what podcasts are to do sort of like paid gated podcasts in. And even if Apple supports it, then can Overcast support it? Can Pocket Cast support it? I don't know. It's kind of a mess. So yeah, it's a mess. So that's our follow up for the time

being. We'll get back to this conversation a little bit later on in the show. But you have some exciting podcast-related news over at The Incomparable this week. I don't think it's news. It's literally counting. But we've been doing The Incomparable for essentially 300 weeks, and that means six years almost have passed. And that means that we did episode 300 over the weekend. So people can check that out if they like.

It's kind of a meta episode. It's sort of really two episodes stuck together. First one, we talk about sort of how our consumption of media, you know, books and movies and TV shows and comics and stuff has changed over the last six-ish years since we started podcasting about it. And then there's a silly segment after that where we do things like draft favorite episodes and answer listener questions and talk about topics we wish we would have covered or topics we regret how we covered it or episodes we wish we were on but weren't and all of that.

So there's a lot of that in there. But I wanted to bring this up because I think it's interesting. And again, apologies to people who don't really care about anything but us talking about computers. But I think in terms of making things on the internet, one of the questions is how do you stop if it's something that is recurring. People who, anybody who's had a blog has had to deal with this, right? Which is once you start a blog, you're sort of like saying, I'm going to post on it regularly. And then at some point you're like, oh man, how long am I going to keep posting on this thing? Maybe I should stop. And I was thinking about that because, you know,

I had this idea. It's very clear from the early, you know, first 20 episodes of The Incomparable that I was not thinking about the fact that this might go on eternally and um and so i made a decision basically like wouldn't it be fun to try this and it has resulted in me you know hosting and editing the the vast majority of 300 straight weeks of of podcast and so you know my question for straight weeks of podcasts. And so, you know, my question for you as somebody who does this too, these, you know, these are serial mediums,

they have subscribers, you're sort of supposed to keep feeding them over time. You know, what, what, how does that factor into your decision about wanting to commit to start something that does that hang over your head? And how do you factor in because you've done this a few times now how do you factor in when to move on and when to say okay i know that i said i would do this for a while but a while is over now and i'm gonna go do something else it's it's such an airy fairy answer but for me like it's just about feeling like so i you know i always start a show and it's like, well, the show has begun. With some exceptions, no end in sight. We're just going to start this and off we go.

By the way, the ring post, the wrestling show on The Incomparable, still in production. I'm still working on it. I'm sorry for everyone that's waiting. I promise it's going to be good. TLDR starting something before San Francisco WWDC was a crazy idea but still working on it I'll have more soon um but my my feeling on this stuff is I wait until the show just doesn't feel exciting for me anymore and when I'm at that point where I'm not interested in it is probably the time for

me to move on from it uh because if I'm not interested in it, then how can I expect everybody else to be interested in it? It kind of feels unfair. If I'm not excited and putting my all in, then I'm not really doing the right thing by the people that are committing their time to listen. I feel like it's kind of unfair to them. So when it gets to that point, I do,

and I've always done one of two things. I either end the show or reboot the show. And I've done those things in various different ways over the six years that I've always done one of two things. I either end the show or reboot the show. And I've done those things in various different ways over the six years that I've done this stuff. And that's what keeps things going for me. I don't have anything that has reached the heights of 300. Do you know what? I probably never will.

Maybe except the pen addict. I think that might get there, right? Just because there's no reason that that show would end and we're over 200 now. Yeah, exactly. It's the only thing that stuck around, but for whatever reason, it's the reason that that show would end and we're over 200 now. Yeah, exactly. Because it's the only thing that stuck around, but for whatever reason, it's the only thing that stuck around. Across three networks. Yeah.

It has remained intact. Exactly. And maybe it's just because me and Brad just have this fun show where we talk about the thing that we love every week and the thing just keeps on moving. It sounds familiar, right? I mean, The the incomparable is a similar story and and one of the reasons that i think i think you're right it's a it's about feeling and i would say it's almost like about feel like this feels like it's probably a good idea uh to do it and i don't know where it's gonna go but let's try it let's let's let's do it and

with the incomparable the the premise is so flexible some would argue completely unfocused it's about anything that it's not about pens, right? It's not a show about a TV show or all TV shows. It's about TV and books and movies and comics and whatever, right? And that is unfocused. It leads to people saying, you know, I've got to skip episodes, which somehow is fine. People are like, oh, I don't know about this podcast. I'm not interested in everything in every episode.

And what I always say about The Incomparable is that's fine. The only person who's interested in everything in every episode is me. You can pick and choose. It's fine. But what that's given me as the person who makes it happen every week, it's been flexible enough to sort of handle what I'm interested in. And that, that if my, my, I didn't think of it at the time in these terms, but looking back 300 weeks, what I would say is, um, I think it would have been a grind if all I could talk about on that podcast was one topic. Like, I mean, even like books, right? I think it would have gotten to be a grind or movies or whatever. Like, and I would have been looking at comics and TV shows and whatever else, the ones that were not part of it and being kind of like, uh, wishing that I could talk about them. And being kind of like wishing that I could talk about them. So in some ways, the reason that it's lasted and that it hasn't become a grind for me where I feel like I need to end it is because if I'm not interested in that topic, I just talk about a different topic.

And I'm allowed to sort of like follow my interests and follow the interests of the panel. And that's been helpful. So it's, you know, and that that's built right into it, which is also why it's not, I think as, as popular as it probably could be if it was super focused on something. But, um, I'm okay with that because I don't think it would have lasted if it had been super focused on anything. And with the podcast network thing, now we've got some stuff that's more super focused. I can do that, you know that Sunday night podcast about Game of Thrones for 10 weeks and then stop for a year and then go back to it. But for the main show, I think it's that. It's just the way it's built in. It's eclectic enough to keep me interested after this time. I should

also say I'm very bad at quitting things. I am. I'm really bad at it. I mean, we've talked about my job, right? and how I had that job for for essentially like 17 years and even the last two years when it was terrible and I should have quit and it was obvious I should have quit I didn't quit but uh it's true I am a I am a person who sticks with things which I think is an admirable trait in a lot of ways but I am always uh questioning myself about am I sticking with this because I want to do it? Or am I sticking with it because I'm too stubborn to say that it's over? And like the blog that we did in the 90s TV, the zine I did, the fiction magazine that I did on the internet, Intertext is the same way where,

Intertext especially, where like, it was obvious for like about three years that I could manage maybe one issue a year and it took that long for me to be like i just need to stop right i i can stop this i all i have to do is say it's over uh but it's sometimes it's hard to say that so uh you know that that that's that's an issue here too but uh i'd like to think that i've learned and gotten better at it. But yeah, anyway. But anyway, congratulations to you and all of your fellow panelists for hitting 300 episodes of The Incomparable. Thanks. It's a big number.

We should also mention that MacPower users hit it a little while ago and I was very impressed by that because I told David Sparks when I was talking to him that I know how many episodes that is. That's a lot. And on one level, all you have to do is just keep putting them out. Like I said, 300 weeks pass, and there you are.

But it's a different thing to do it that long. It's kind of special, and I appreciate it when I see it. And Pen Addict, at over 200, it's amazing. Yeah, MPU's up to 321 now. I know.

Well, they do those bonus episodes. We used to be ahead of them, and now we're not. That's the way they do it. The Pen Addicts is moving to daily, just so we can take you down. Oh, good. That'll get your numbers way up. We're coming for you. Yeah.

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fm so we had a bit of follow-up regarding cellular connectivity in watches from our friend Andrzej Tomic. Andrzej is a fantastic podcaster from Slovenia. He'll be so happy that we pronounced his name and said his country right. Well, we try. What can we say? And we met him in person, so that's nice. He's very tall. Yeah, he came to the Upgrade meetup. Was it last year?

Yes, it was. There you go. So last year. And Andrzej, he tries out lots of products like he does lots of product reviews and stuff yeah for his shows they bring him cell phones in a paper bag and he reviews them tips them out of the bag yeah it's going um and one of the things that he has been reviewing recently is the lg watch urbane second edition and this has a nano sim slot in the watch it has a speaker and a microphone so you can talk into it like on phone calls and this has a nano sim slot in the watch it has a speaker and a microphone so you can talk into it like on phone calls and this something that's quite cool that actually said that the

antenna for the for the like all the calls and stuff are in the watch band but this makes the watch band non-removable which is sad for you yeah which is very sad i think it's sad for everybody uh and he says that it's kind of ridiculous to use for phone calls, right? To talk into the watch, but it does work. Like the speaker isn't that loud. It gets a bit crackly. And I like that his overall kind of feeling is the watch as a phone concept technically works, right? Like you can do it.

Somebody is doing it. It is working, but it's not really that cool. Yeah. He says it's cool in Knight Rider or something like that. yeah he says it's cool like uh it's cool in night rider or something like that kit come and get me right but not in that's an old tv show but not in real life so uh it's yeah this is why i was saying last week that i i feel like um we got some good feedback about this i actually um i think i was fortunate to have that experience of having the second gen kindle with a cell stuff built into it because a lot of people were saying, oh, I hadn't even thought of something like that.

Because, you know, it's sort of not something you think about unless you've actually had a device that did this. This sort of like it's paid by the vendor. It's very tightly metered. Like how does Amazon get away with it? They control the software that's on it. So even if you had something like that, this included with the device on slow speed networks, you never really even see that it's there. And since Apple in this case would control the software,

you wouldn't really need to worry about data usage. The data usage would be pretty limited because Apple would limit it because it's paying for it or it's got some sort of agreement with a cellular provider to limit how it's used so it doesn't destroy that network um and uh the more i think about it i mean this is why i think this is the right direction for something like apple watch because it gives it conductivity without it becoming your phone like uh and i think like having it only have access to data is is a part of that too that you know you can talk on your apple watch now but uh it's it's using your phone

now if they can do it so that even if you're nowhere near your phone phone calls also ring your watch and you can pick up your phone you know a cell phone call to your cell phone on your watch. That's good. But I don't want another phone number for my watch. But that may be doable. It may be similar to the stuff they do in your house with sharing your phone calls and, and texts and things across devices. It, you know, if they're maybe if they're on the same carrier, probably not if they're not. But anyway, I think it's an interesting idea. And I would rather do that than have it be something where I have to pay $10 a month to add my watch to my AT&T plan. Yeah, I'm not keen on the idea of these two things being separate. As we spoke about last week, the idea of it being able to work independently, but to understand that it is tied to the phone.

That's the key here, really. I want to just cover a little piece of news because I really am very interested in what you think about this. Out of the blue last week, there was news that came that Apple has invested $1 billion in a Chinese ride-sharing service, like a big Uber competitor in China, called Didi Chuxing. Tim Cook gave a bunch of comments to Reuters. He's saying that they've invested a billion dollars in this company because it will better help them

understand the Chinese market. And they said that this deal reflects our excitement about their growing business, Didi Chuxing, and also our continued confidence in the long term in China's economy. This is as much about sending signals about their seriousness in that country as it is about helping Didi build a ride-sharing platform, he said. And then Tim, he tweeted a picture of him in Beijing hailing one of the Didi taxis. What's going on? What is this?

I don't know, other than I could say it suggests something about Apple's commitment to China, not just to the world, but to China and to the Chinese government. Yeah, I feel like this is more of a way for them to... They're not necessarily... A lot of people are speculating like, oh, this is them trying to understand cars. I think it's just they found a company that was doing pretty well that they could invest in

so it looks good in Chinese business. Yeah, it could be. Ben Thompson from Stratechery wrote a piece today, I think it's a subscriber piece that I liked. And I liked it for his forthrightness about the fact that he says with China, nobody really knows. Because unless you're on the inside, nobody really understands why the Chinese government does what it does. And it does what it wants. why the Chinese government does what it does. And it, you know, it and it does what it wants. So even though Ben is, I would say, from perspective of like people who write about Apple and other technology companies, fairly knowledgeable, even just because he is in Taiwan,

that he understands things about Asia and about China, that the rest of us don't. But he said, look, I have no idea either, because unless you're inside the Chinese government, you really don't know what's going on here. It seems to be Apple sending a signal to China about its commitment and being a good citizen and being a part of the Chinese economy. Does it mean something about Apple's position on ride sharing? Specifically, does it mean something about Apple's position on building cars? I'd say maybe, but the overriding thing I would say is that this seems like it's about China. Tim Cook famously has said that he thinks China will ultimately be Apple's biggest market. It's already the second

biggest market, the greater China segment. And I think that's only going to, you know, that's going to continue to grow. Apple wants it to grow. Apple sees China as a market of huge potential. And it's hard for Western companies in China sometimes. And the Chinese government makes it hard because they want to, they have their own interests at heart. They have China's interests and the people in the Chinese government's interests at heart. And there's some suspicion, I think, a lot of times of companies from the West making their investments in China. And I think Apple has played that game pretty well of showing their commitment to China. Apple's business model works fairly well in China. And so that, I don't know, that's my that's my gut feeling is that this is about Apple putting down more roots in China and showing to the Chinese government that, you know, it is absolutely serious in this. Now, whether this is something that was like Apple's idea or was D.G.

Chuxing's idea or whether it was the Chinese government's idea to push Apple into this investment. Who knows? Who knows, right? I feel like this is the equivalent of nuclear arms talks. This is high-level stuff. But I do feel like that's some of what's going on here. Because whatever Apple is doing in the automotive industry, they're not looking at creating an Uber competitor. I just don't think that's what they're doing.

So I don't think this is it. And also knowing Apple's previous trajectory and investments, they wouldn't invest in a company like this if they were planning their own service. They would either buy it or leave it alone. Right? Right. This is just a fascinating out of kind of character story.

They may not be allowed to buy it anyway right it's a chinese company so this may be the you know you want to be in this market but you we're not going to let you buy our company well but they could buy lyft or uber right probably if they really wanted to do that yeah that's true i suppose i don't know yeah it's just it's just this is one of those things that is – and this keeps happening, right? Because it's a different company under Tim because it's his company, not Steve's company. So over the last couple of years, I feel like we've all been saying constantly how different it is. This is new Apple.

And this is just another one of those things. But they've never really done anything like this before. Like making a big public investment in a company that is kind of completely unrelated to what they do in another country. And, you know, making a big song and dance about it. Like they usually keep these things pretty quiet. Is it unrelated, though? I mean, these are all app based. It's tangentially related. Sure.

Like Apple make computers and software. And this is... Unless we know that they've got uh you know a car initiative going too that makes it a little less tangential but yeah but it's you know it's just a very it's just very peculiar it's just very peculiar i i don't disagree it is a strange thing but exciting at the same time because it's weird. Right? Like for me and you, like this sort of stuff is super exciting because this is new. We're getting to talk about and consider things

that we've never considered before when looking at Apple. Like why are Apple investing a billion dollars of their money into a Chinese ride hailing service that we've never heard of before? I don't know. Let's think about that. And that's what i find to be really

interesting right yeah who knows what they're doing it and and i'm interested to see where it goes it feels like a lot of this like the timing you know is really kind of related to the earnings calls and stuff like that right like how are you going to grow your business we're now going to invest in upcoming companies okay great here's the stock price increase. You know? I don't know. I guess we'll see. Should we move on to our exciting next segment? We should indeed.

All right. Well, before we do that, let me tell you about one of our sponsors. Our good friends at MailRoute are helping you bring, helping you listen to this episode by helping us bring it to you.

That's complicated. Anyway, MailRoute is sponsoring this episode. Let me tell you about them. MailRoute, they're email experts, they will stop the spam and viruses and stuff going to your mail server. It's pretty much that simple. IT departments are always expected to do more with less. That includes stopping spam and virus attacks. And of course, a lot of the solutions out there for mail filtering have died. They've been moved to end of life status by companies who are not really focused on those areas anyway. MailRoute is different because MailRoute is focused only on that. What they do is email.

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and telling them that upgrade sent you. Thank you so much to MailRoute for sponsoring this edition of upgrade. Hey, mailbagging. Mailbagging. I'll keep saying it. You didn't give me the chance. I was so excited. Mailbagging. Oh, hey, Mike. Yeah. Did you know that MailRoute supports LDAP, Active Directory, TLS, Outbound Relay, and mailbagging? Mailbagging? Yes. Everything you'd want from the people handling your mail. Thanks, MailRoute. Thank you, MailRoute. So now we are very lucky to be graced by the EVP of sales and development at Midroll Media and all around podcasting nice guy, Mr. Lex Freepin. Hi, Lex.

Hi, how are you? Good. Thank you so much for joining us today. We have realized from our listeners that they are very interested in hearing more about what happens in podcasting. And one of the things that Jason suggested last week is, why don't we talk to you about the things that we find interesting and or concerning? And you could tell us why it's all okay. That's kind of the thinking here. I'm okay with it. I will say, you know, I listened to your episode from last week, and I listened to ATP's episode from last week where we were talking about it. And there's parts of it that we're in total agreement on and parts of it that we're in less agreement on.

I feel like it's important that I disclose all my biases. Obviously, I work for a podcasting company. I sell some of Jason's shows. I have sold some of your shows and Marco's one show or atp at least uh in the past um but i just want to make sure that i disclaim all of those things so that all biases are revealed yes i used to be i used to be your boss you have a podcast although it's dormant right now that's at the incomparable there are lots of connections here that's fine which is why you're the perfect person yeah you're one of us and you're one of them. You are also somebody who understands what we do,

which is ever so slightly different, I think, from some of the larger shows and the way that we're approaching things. So I have a bunch of questions and points that I would like to discuss with you, Mr. Friedman. Go for it. I think fundamentally, one of the things that we're talking about is all the stuff that was in that article, but just in general, what data do you feel from the conversations that you've had that advertisers would like from podcasters that they don't

currently have? What are the things that you hear about the most that companies that are willing to advertise want but can't get? So the thing that we hear from the most that companies that are willing to advertise want but can't get? So the thing that we hear from the bigger advertisers who either are in the space or are saying, I can only get into the space when, the things that they're asking for the most are they want to know how many people have actually heard the ad, right? They're looking at us as digital. And so they're saying, hey, when we buy what we consider digital ads on YouTube, we know who clicked the five second skip button, who watched the whole video, who fast forwarded as soon as they could, or who saw the entire ad. We want to know that for podcasts. Now, what I tell them is I don't have

that number. My guess is I'll never have that number. If we were ever going to really have any version of that number, it would have to come from Apple and they're never going to give it to us. But the thing that I tell everybody, and I genuinely mean it is if we had that number, it wouldn't change the price, right? It would change what the metric is that we're using against our CPM. So we'd say,

you know, okay, it's, let's say that 40% of the people who listen to a podcast, listen to the ads. I hope it's a lot more than that. Let's say it's 40%. I wouldn't suddenly charge only 40%

of what we're charging today. It would just say, okay, the number that we're using as our multiplier is now this actual listens number, so it's still the same price. The market has proven that the pricing is fair on these things. And it's really, they're just, you know,

I used to and still do deal with all the direct response advertisers that you guys were talking about last week. You know, everybody with their offer codes, up to and including mail route. Um, they can track every single thing that's happening. But I would say that mid rolls business over the past three years has

evolved from 90% direct response to about half. And so we're doing campaigns with Wendy's and Dunkin' Donuts and all state. Um, and, uh, where's my Dunkin' Donuts ad on the Incomparable, Lex? So far, they're only buying Bill Simmons. All right.

But the brands that we've landed are head and shoulders. Head and shoulders did a campaign. And they didn't spend – I think you guys even made references, maybe Marco and company did, to the fact that big brands coming in aren't necessarily going to spend bajillions of dollars, right? They're going to test it out just like everybody else. But the folks who are coming in are cautious because we don't have more measurement. And then the folks who are on the fence keep telling us, well, I need to know exactly how many people heard the ad, which you guys made the point last week. Well, do you know how many people saw your ad on the billboard or in the magazine or on television or on the radio? The answer is, of course, no.

But they believe all the numbers they get for those things. They believe that Nielsen numbers are accurate. Right. Would it be safe to say, given my background and seeing print salespeople as well as digital salespeople, would it be right to say that there's really a disconnect where people who are used to buying digital, like you said, they expect web metrics for everything. And even if podcasting is more like radio, except with better stats, because we do have some statistics, that's not what they're used to. They're used to having rafts of data to use to make their buying decisions. That's fairly accurate. And when we talk to ad agencies, like the giant ad agencies in Madison Avenue and whatnot, sometimes it's their digital team and sometimes it's the radio team. We're too expensive for the radio team, right? The prices that radio gets

typically are very, very low and they're typically selling spot. If you're doing, meaning like a pre-recorded 30 or 60 second spot that they play on the radio. If you're doing host reads, like most of us are doing in podcasting, that's typically on the radio. If you're doing host reads, like most of us are doing in podcasting, that's typically local talk radio who is selling host read style spots. Um, and so when, when it's the radio buyers talking to us and we're like, no, we don't have day parts. Like they want to know what hour is the ad going to run all the hours. The ad will always be running five years from there. Now the ad will run. Yeah. run. Yeah. So most of the buying, I would say probably of the agency buying, greater than 95% is coming from digital buyers who, like you said, they're accustomed to digital style numbers. And that's what they want from us.

Right. get the data and trying to educate companies like apple as to why they should provide the data that maybe the effort should be focused on the advertising agencies about the way that podcasting works about the benefits of the medium and why it should be thought of more like radio but in the digital space like it's it feels like there's a disconnect that because it's on the internet it should be like web ads it could be argued. And I don't disagree with that mentality. But I have to think carefully because of my job and not wanting to offend people who buy ads for me. The reality here is this, right? Agency ad buyers are just like you and me, right? They want to be able to do the best work they can, ideally with the path to least resistance.

And so they're accustomed to buying what they know how to buy. And the number one way we get agencies buying is the number of Dunkin' Donuts, of course, comes through an ad agency. They don't do themselves. But the only reason Dunkin' Donuts bought was because somebody at Dunkin' Donuts

told the agency, oh my God, Bill Simmons has a podcast. He talks about Dunkin' all the time. Buy ads on it. And that then gave them the push to do it. Without that happening, without the brand having a podcast advocate saying, I want to buy ads on that show, they wouldn't have come. And that very frequently is the way that I sell ads for Relay, right? Like we will either have somebody contact us who works in that company to say that they want it to happen.

Somebody contact us who works in that company to say that they want it to happen. Or I speak to somebody who asks a question inside of a marketing team and someone puts their hand up and be like, I love those shows. Right. And so I think, yes, we can keep working to try to convince advertisers this is what we have. I'll tell you what some of the problems are. And I think that you guys fairly, but still did this. I think you maybe mischaracterized the meeting or why people went to the Times last week. Because I was not at the Apple meeting. I can say that.

Whether mid-roll was or wasn't at, I couldn't say. Because I'm sure that Apple would have anybody who attended sign an NDA. That's just my guess, knowing how Apple works. The article did say that. Right, exactly. And so I, my guess is people simply, people at the time said, Hey, what were you doing at Cupertino person from various local podcasting companies who I like? And I go, well, I can't really tell you, but I'll tell you off the record kind of thing. I don't think that people want specifically to complain is my gut.

Um, but here's what we have today. There are competitors in the space, companies selling podcast ads who claim to have the numbers that advertisers want. We get asked, I swear to you, every single day. I have 10 salespeople now. Every day, at least one of them gets asked, can we use a tracking pixel?

And we say, no. And then they say, but competitor X, and I'll tell you after we are done recording who the competitor is, but they say competitor X says they can do that. And no, they cannot. Like you guys know how MP3 players work, how audio files work. You cannot embed a pixel in there that somebody will load at the time the ad shows up unless it's in some custom app, which is where none of the listening happens, right? Still 60 to 70% of the listening is happening in iTunes or podcasts. And there's no mechanism by which you can report back, but they're being told that there is. So I think people in part went to Apple because they wanted to say, guys, liars are saying that this is how they contract things. And if you can give us some kind of reality to attach to.

So last week you guys were saying, because Apple doesn't stream the files, they can't do this. My understanding from anonymous sources is they absolutely could do this. Like they already can report to you on who's streaming versus downloading. I think a large percentage of people are streaming in podcasts and in iTunes without even knowing it, right?

They just hit the play button so it starts streaming and playing. And Apple knows, even though they're just kind of passing through the file, they know how far you've gotten. I have seen a report from Apple on completion rates. They don't actually make it available. I don't see one every week. I saw one one time that was anonymized and wasn't about any shows that I deal with, but they could do it. They own the app. If you've got the player app,

you can get the stats. That's absolutely true. It's stats from your player. I want to go back to something you said, though, because I thought having worked as you did when you would visit our office in San Francisco, having worked with digital salespeople, it's a tough job. And they are being – how do you measure the effectiveness of a salesperson who's selling digital? One of the things is they've got to have good relationship with clients because they've got to make the sales. How does the client measure effectiveness with a branding campaign on digital? And it's hard, right? Because like you said, there's a leap of faith with numbers from radio or TV or something like that. And so I understand the impetus here from the salesperson and from the person at the agency, which is like, you know, how do I get, so I'm an agency ad buyer. And

unless Duncan is telling me I want Bill Simmons, I need to justify where I'm putting money. And if I have no numbers that will convince my boss that this is a good buy, why would I do that? Right? Why would I go down that route? And so you end up, even if we all feel like, oh no, actually this is a really good medium and you should do it. I can see just from a personal

scale of the people in the chain, the person who has to sell the ad, the person who has to buy the ad, that it would be difficult because they need to show proof. And more and more, the only medium that has proof proof that everybody's used to is the web. And so they start to say things like, can you give me pixel data, even though that does not exist. And so what we've started doing is when it's a big brand, like if it is a Dunkin' Donuts or a Wendy's or that kind of company, we'll try to do a recall study for them. And it's surveys are what they are, right? But it's the only thing we can do. And so when brands are advertising on television, in theory, they're going to say, hey, let's do some kind of brand lift study. Let's do

some kind of surveying, some kind of sampling to say, what ads were in that TV show? Can you remember without us helping you at all? Can you tell us unaided, they call it? Can you recall who the advertisers were in that episode? And then once they say, okay, you saw an ad for, you know, X car company. What car was it? What did they say about the car? What were the features? So we've been basically doing that on some podcasts that have brand advertisers. In the post roll, at the end of the show, they'll say, hey, listeners, if you have two minutes, go fill out this survey. Now, it's some kind of survey bias, right? Because it's only people who've listened to the end of the show. It's people who like the show so much that they're

willing to go fill out a survey that has no reward for them of any kind. They don't know why they're filling out the survey or what it is because we don't tell them, hey, we want to ask you about the ads you just heard because that would already skew your results even further. So people go in and they tell us, but what's amazing is exactly as you'd expect, the numbers are really good. People listen to the ads. It's not like radio and television where they ignore it or magazines or the web. They actually pay attention to the ads. So they can tell us, oh yeah, I heard the ad. I can remember who the advertisers are. And more than half the audience says, I'm more likely to eat at that restaurant or shop at that store now that I've heard that ad. So we can get the right data, but now everybody

wants a recall study and there is a finite amount of listener patience to keep hearing recall studies and keep following up on doing them. But that's the only, if it's not a direct response campaign where you can track coupon codes or vanity URLs But that's the only, if it's not a direct response campaign where you can track coupon codes or vanity URLs, that's all you can really do is try to do some brand lift. I will tell you, there was one restaurant chain that said, all we're really looking for is,

and I'm quoting here, all we're really looking for is asses and seats at the restaurant. And I said, well, how will you tell if the podcast helped that? And they're like, they said a line that I've heard from numerous advertisers, which is, they think that overall 50% of all their brand advertising is effective and they just don't

know which 50% it is. So as long as the numbers are trending in the right direction, they keep doing everything that they're doing. I used to work at a very large company, a global company, and I worked in the marketing teams and I used to sit in meetings where the digital advertising people would sit and they were basically of that idea too this seems to be like a prevailing thing it's just like we know we're putting all this money in and we know something's happening we have no idea what is causing it but we know it's good and it was it was a very interesting thing to see. And it's because that sort of brand advertising exists in other medium

is why I think that it can and does exist in podcasting. But then when you start putting the data in it, I think it fundamentally changes what the advertising is. Because if you're, again, I know we've gone over this, but if you're looking at this is more like

radio but you have to pay digital i know it gets tricky but it's asking for data to exist that doesn't exist right and then how do you i don't know how you start to come to combat against that like companies just have to go along with it right doesn't it also the web i feel like it has skewed this because the with web, direct response is so powerful. Everybody wants to measure. I mean, that was my experience at IDG. It's like everybody wants to sell direct response.

Everybody wants things, click-throughs, click-throughs, click-throughs. What are the click-throughs? And that misses the most, I would say, powerful and lucrative portion of advertising, which is brand advertising. And for people who don't know about this, it's the difference between an ad that makes you feel good about a company and its services or products and an ad that wants you to call a phone number or go to a website right now. And on the web, a click-through is like you're picking up the phone and dialing to buy that

vegetable slicer. It's direct response. They can measure that click. And the problem is branding advertising doesn't really work like that. An old boss of mine used to say, you have to be considered to be bought. Your brand's legitimacy is a part of this, the importance of you getting business. And all those Squarespace ads, I think Squarespace is, although they have some direct response, Squarespace's campaign on like every podcast was a branding campaign

because what they want is if somebody thinks I want to set up a website, that Squarespace is the first thing that comes to mind. And I think it's been very effective at that. But like Coke, Coke doesn't want you to click on a box in order to get a Coke in your house, right? Coke wants you to think, oh yeah, Coke, I like Coke, Coke doesn't want you to click on a box in order to get a Coke in your house. Right.

Coke wants you to think, oh, yeah, Coke. I like Coke. I should buy Coke the next time I go to the store or the next time I need soda. I should get a Coke. It's it's or Vizio is the example I give. Vizio did a lot of advertising because they wanted to be seen as a television brand and not the cheap TV that is at Costco. And the benefit there was not direct response. It was the brand got better, but you get branding without clicking on things and

without direct response. So it's very hard to measure it and you don't know if it's working or not. I think that's all exactly right. I don't disagree with any of it. And the one thing that you mentioned last week, Jason, on this show was ideally there'd be some way to sample it, right? Because advertisers are asking for data that they don't have from anything else except the web. And we even know that the data they have from the web is bogus, right? Just because the impression was served doesn't mean anybody saw it. Could have been an ad blocker. Could have been off the page.

Whatever. A lot of people have the ads turned off. A lot of things messing with it. But if there were some way to give them sample sampled data the way they have for television and radio i think advertisers would accept it in a heartbeat but the problem is to get sample data you need apple and google and overcast and like every every app that with an endpoint there has to participate because if let's say that marco came to me and said and i mean years ago when he first launched it i asked and he passed he said there's no way

yeah if marco said hey lex pay me this fee and you can have access to my listener behavior data I mean, years ago when he first launched it, I asked and he passed. He said, no way. If Marco said, hey, Lex, pay me this fee and you can have access to my listener behavior data. It's not useful, right? Because I think, Mike, you said last week that like 60% or something of your listeners come from Overcast, which is obviously atypical for the industry overall. But that's – if I were only sampling Overcast, which is – I don't know. I don't have any percentages in front of me. But it's a single-digit percentage of, say, WTF with Marc Maron. It's a very different audience potentially from people who are listening to it on SoundCloud or in Howl, like whatever it is.

So getting data from any one app is not useful, right? It has to be true sample data across everything to be at all relevant. And that's – you mentioned it as a good idea, which it is. I just – I don't think it's possible to get. Well, I mean, you would have to get it from a survey. I mean, you'd essentially have to build a Nielsen survey style thing of podcast listeners. You'd have to recruit a panel on, I guess, websites and maybe by putting advertising and podcasts saying, would you like to join our panel? And you'd, I mean, it would be a huge effort to try and create something that you would have to feel at least somewhat confident is a statistically significant percentage.

How does it work on radio? I mean, I did it once where they sent me a booklet in the mail. So today on radio, they give you a thing that's always listening to what you're listening to. Oh yeah. And it's like, it's like Shazam.

Yes. I think they do that for some tv ratings now they do that for some tv ratings too tv i mean the basically what podcasters what podcast companies are saying to apple is be like tivo give us the dvr data that you have tell us what people are watching and listening tell us how far they get because tivo is able to make that data available and does they do it all anonymized and as a soul-sucking advertising salesperson that's the data i want like i would love to have anonymized bulk data of who got where. But with radio,

it's like listening over your shoulder. Hey, did you hear that ad? Are you hearing that ad? And they know because when you're in the car, right? If you aren't listening to a podcast for some sick reason and an ad comes on the radio, most people who are driving jab at the preset buttons to go to the next station.

So they have these little listening devices so they can know which ads did you hear. And then, you know, the radio companies add some giant number to it and say, okay, that's the number of people we have listening to our station when the ads are on. And it's all bogus, but it's bogus that's accepted by advertising buyers. Yeah. All right. So I have a feeling about this and this is kind of, I guess it's kind of selfish, but I'm just thinking about my own business here. So like you mentioned a moment ago, about the fact that we skew so much on our shows towards third parties. And all of this discussion is around what Apple can do, what Apple can do, because in more mainstream shows, Apple is the 60, 70%,

where for us, we have third parties in that. Even incomparable, it's like 60 or 70% Apple. Right. Because again, it touches more on mainstream topics so making these kinds of changes asking a company like apple to provide this data is this not a scenario where the needs of the many could affect the needs of the few right so it's going to make massive changes potentially to the business where i and many other niche kind of podcasters can't give that data and then that then affects the way that we can do business, right? I think it's a reasonable concern. I think it's partially a marketplace concern, if you know what I mean.

Like it's the same way that when there were 100 blogs using AdSense, they could make more money than when there's a billion blogs using AdSense because there's less of that to go around. I don't think though that it I don't think it negatively impacts your business in a measurable way is my guess. Because if it means that more advertisers can trust podcasting, and they can get in and say, Oh, okay. So if they're saying that Marc Maron gets I'm making these numbers up 650,000 downloads, and 580,000 people get all the way to the end of each episode on average. Now I know people is in a podcast. So I think to me, and I am trying very hard to be as unbiased here as I can, although I can't escape what I am and what I do. I think it probably ends up lifting all boats

because today I wish I had more tech shows, right? I wish I still sold all the relay shows because the niche, the audience there is so strong. And so, and Syracuse was talking about this on ATP. The audience is so pre-identified as these are tech-centric people with affluent incomes and eagerness to spend on well-recommended products that make sense for them. They do really well, right? It's a relatively easy sell, all things considered. all things considered. So I would be surprised if, let's say that, you know, because the WTF size shows of the world had more listener behavior data that advertisers said, well, I'm never going to buy, you know, from ATP or from Upgrade again, because they still, once they've proven to themselves that the industry works, I feel like when they want to reach the tech audience, they're going to know to come here. And I'll add this.

audience they're going to know to come here. And I'll add this. If you listen today to a show like The Talk Show or ATP, you hear on those two shows in particular, shows that I really love and like shows that I have sold in the past, you hear today the same six to 10 advertisers most of the time. I would say 90% of the spots are maybe six to eight advertisers across those shows. And to everyone's point, that's a really good sign. That means the show really works for advertisers. If you hear different advertisers every episode of the show, it's a show that doesn't work that well for advertisers because they don't renew. So the fact that they have the same advertisers again and again is very reassuring for them. But when I look at it, it's like, grrr, because I'm seeing all these brands who want to get in, who are coming to me and say, hey, do you have any giant tech shows?

I'm like, no, not anymore. But the advertisers are there, right? Maybe neither Marco nor John would want to run ads for the Aaron Sorkin Steve Jobs movie. But we ran a big campaign for the Steve Jobs movie, right? And I literally just had somebody come to me last week about a new book about Steve Jobs that's coming out. And I'm like, well, I can put you on these shows, but if you want these other ones, here are the people to contact. But I think that they're probably, all those shows are doing very well, which I don't think is telling tales out of turn, but they're doing very well

financially, I mean. I think they're probably even leaving money on the table though, because they're so direct response focused, because they're brand advertisers who want that audience so badly. And the same way that people would pay a premium to be on um to have their ads run on the west wing speaking of erin's work and even though its audience was smaller than friends it was a different kind of listener or a different kind of watcher in that case and i think that's the same situation that atp and the talk show have and because they can't give the brands what they want necessarily the the brands aren't coming to them. But it's also – The brands.

The brands. Brands. Marco will love this part. The thing is, though, like I keep going back to it, then when we can't hand over that data, like so someone says to us like, oh, this big brand advertiser comes, this movie comes, and they're like, okay, and we've advertised here and there. And we want that data. We want those list and a number data from you. And we say, well, we can't advertised here and there. And we want that data. We want those lists and a number of data from you. And we say, well, we can't give it to you. Doesn't that then affect it though?

Because we don't have the information that they know has told them that it works in other places. And if a podcast, which doesn't use one of the big platforms as its primary way of distribution, cannot give that data to a new advertiser does that not put them on a on a bad foot with them i still don't think so because i think that if the like i was saying before if if if they're able to prove to themselves that in general people listen to podcasts pretty far through and they're if they're able to prove themselves that yes this medium is going to work because they can get over whatever hurdles they have today then like you're able to tell them look

more than half of our audience is so opted into this meeting that they went and got a different app. Like they took it a step further because they felt, you know, we're a pro level listener. We need more access and we need better features and be able to get through more shows and subscribe in more ways. Like I think that, you know, if you got, first of all, if you got to the point it was with Overcast specifically and suddenly companies like yours were hurting, I know the guy who makes Overcast and you could maybe convince him to change his mind a little bit on how he approaches it.

But I doubt it. You'll still have 10 to 20% of your audience at least using iTunes, right? Or using Apple. Yeah. And you'll be able to have a sample just from that. And you can tell them, look, you've seen that the medium works from these other things, from these other shows. And, you know, a portion of our audience is doing this, has these great or even better numbers, let's say comparable numbers. Um, and we assume

that the overcast piece is even more engaged based on the fact that they've opted into using a different app and have, have gone out of their way to make it easier for them to listen to this show. We also, you know, we are very focused on niche advertising, right? Yeah. And I agree that there are quite a lot of advertisers that are, they frequently sponsor all these shows. And one of our big goals here is to bring new people in. And we have a couple of companies that we've brought on now, which are different, also have lots of buy, right? They're buying lots of shows over many weeks.

And I think our listeners are starting to hear those. so we are focused on trying to broaden that net but it's still within our niche and one of the things that i think about is the reason that our cpms which is the cost per thousand listeners are so high is because the advertisers and the content and the listeners match up so nicely if the net if overall everyone starts to go broader, right? So we're all going broader with bigger brand campaigns. Wouldn't that drive the CPMs down because the fit is not so tight? It's an interesting question. Not so far in practice. I don't think it's impossible. The broader an audience, the less valuable it is to an advertiser. I think that's true. But if the brand specifically wants to reach that kind of audience, then it's very

valuable to it, right? It's like real estate and everything else. It's worth what people pay for it. And Dunkin' Donuts in its case, didn't even care so much who Bill Simmons audience was. I mean, they did, but they were more interested in the fact that Bill Simmons grew up with Dunkin' Donuts. You know, he's a sportscaster. He grew up in Boston where Dunkin' Donuts is. And he talked about it organically in his columns that he wrote all the time. So they said, we want him to talk about us for pay. And his very first ad was like four minutes long

talking about his childhood where every day he would take his allowance money and go to Dunkin' Donuts after school. But so I think that advertisers are gonna say, look, we're trying to reach, like, honestly, podcasts are helping them reach people. They can't reach anywhere else, right? Men 18 to 30 something aren't watching TV nearly as much as they used to. And if they are, they're watching stuff that streaming doesn't have ads.

Um, but they're listening to podcasts in big numbers. Uh, the kind of the people who listen to your shows, right? This well-educated, high-earning listener, tech-centric listener is, again, not watching television, right? They're listening to podcasts. This is the place to go to reach them. And advertisers definitely want to reach,

that's why CBS might have the top-rated shows, but maybe doesn't get as much ad dollars, doesn't have the top-rated shows amongst 18 to 34-year-olds, the people who spend all the money. I used to be an 18 to 34 year old. Those were the days.

But so it's like, overall, my gut is that if, to be honest, it's mostly an intellectual discussion because, well, except for my part, because I don't think Apple will ever do it. But if Apple were to say, hey, we're going to provide some anonymized data, even if it wasn't show specific, but just industry specific saying this is the percentage of people who listen in these categories of shows all the way through or whatever um if we had i don't think they'll ever provide that data but so what are you going to do then right because i mean this whole conversation is focused around how good this data would be and how much it's going to help the industry but i think we're all in agreement here that

pigs will fly, I think, before you get any of this. So what happens? So, you know, one of the points that ATP was making was what you should really be focused on advertising industry and podcasting industry in general is how do we get more listeners? How do we get more people into the space? For me, it's a chicken and egg problem, right? Like Howard Stern renewed his, I'm not saying that Howard Stern is an ideal podcaster, but if you take, if we take as truth that he is hugely popular and that Sirius XM is built on Howard Stern, he's too big for podcasting. No podcasting company can give him the money that he wants because the advertising dollars aren't there yet. Now, Wall Street Journal ran an article a couple months ago saying that the entire advertising industry

for podcasting was 35 million, which is like laughably wrong. So there's real money in podcasting, but there's not Howard Stern money in podcasting. So part of the reason that people like me are so eager or wish that Apple would succumb and give us more data so that we could woo these advertisers

is because those advertisers have the bigger budgets, right? Like even unlocking the Fortune 100 of podcast advertisers of which we've cracked here at Midwell, I don't know, 10, is a lot of incremental money into the space because it's not like it's going to stop working for the Caspers and Squarespace's and mail routes of the world. It's going to keep working for them too.

So my feeling is the more people we can, the more money that the industry can make, the more big talent will come in there. The more big talent that's there, the more listeners we'll get. Because today, I don't think there's a vast untapped market of tech podcast listeners who aren't yet listening to tech podcasts. I think for the comedy space that Earwolf sits in, which is part of my day job, I think we've hit 90% of the people who want to hear that kind of content are listening to it right now. Then there's a big content market of all kinds of other people who don't know what podcasts are, don't know how it works. For them, podcast app, iTunes, and Overcast are all too difficult right now. Figuring how to connect their phone in the car is too hard.

Podcasts are all too difficult right now. Figuring out how to connect their phone in the car is too hard. All those pieces. If my car could download the episodes for me automatically and be synced with whatever app I'm using so that I could just get in the car and push the podcast button and start listening to the latest episode of Upgrade, that's where the industry has to go. But to make all those things happen, to make it get that mainstream, it's going to have to be all the things happening at once. Bigger talent coming into the space so that you can get bigger shows and making it all easier so that more and more people are getting in there as listeners. So what are we going to do? We're going to keep doing what we've been doing, right?

We're going to keep having these same conversations with advertisers explaining why they can't have the data that they want and trying to reassure them that it doesn't matter. And we're going to miss out on some advertisers. There's going to be some folks who we, I have a trip to Detroit next Monday, a week from today, to talk to the kinds of companies. What kind of companies are there? You can guess what kind of companies are there. Some of them have tried podcasts. Some of them are looking to do bigger and better things.

But it's an open question as to whether all of them will. I used to think, I used to tell everybody, look, if we get one movie studio advertising its movies with us, all the movie studios will. It actually did happen with TV stations, right? A lot of TV networks do tune in with us where they're saying, hey, tune in to this show at this time. And I'll tell you just as a quick aside, sometimes they'll say, hey, we only want the ads to run up until the time the show premieres. After that, can you pull the ads out?

It's like, no, we're not going to do that. You are very old school and you're thinking you are crazy. That's what we're dealing with. I was going to ask you about that does that hurt podcasting the fact that you cannot guarantee a listen and that the ads the ads are kind of baked in and then stay forever oh hell yeah that's why some people in the industry are moving to inserted ads right even if it's effectively a host red spot they're trying to pre-record the spots and inject them at the time of download so that you might hear the host reading an ad for, you know, Squarespace this week. But if you listen next week, you'll hear an ad for a TV

show that comes out that week. Yeah, that's one thing I noticed. I downloaded Serial recently, the first season, and the MailChimp ads were gone. Yep. And that's very common. It's going to get increasingly common. Everything that, just about everything that we sell today is still baked in, right? The ads are there until and unless we strip them out by hand, which just doesn't happen. But the industry in some places is really trying to move to inserted spots like that where it's inserted on demand as you download it because they know your geo when you're downloading it and they know the date when you're downloading it.

The risk to me is if you go down that route, it gets really easy to say, you know what? the risk to me is if you go down that route, it gets really easy to say, you know what? We could take a prerecorded Geico ad for a $3 or $4 CPM and just put that in if we didn't sell the spot. And that's when podcasts really start sounding like radio and it's when listeners really get alienated.

The ads are so cheap because they don't work that well. It's not the host reading it. And listeners start tuning it out. And it's like, think of how good you are at ignoring every commercial around you. As soon as it's a pre recorded spot, none do anything other than take you out of the podcast. So I've been holding that off as far as I can. Yeah, I agree with you. I'm kind of intrigued by the idea of having my, you know, host red spots, dynamically inserted, we actually hear a lot from people in Europe

about how so many of the ads on the relay shows are obviously, and most podcasts, right, they're often very US-centric. And the reason is exactly this, which is everything's just baked in right now. This is, I mean, it is very primitive in that way. And yes, if CBS wants to have that ad for CSI Cyber stop running because they canceled it, you can't. You just can't right now. Yeah. I have one follow-up before we wrap this up, which was standardized data.

One of the things that I know that your podcasters that you were selling for have to do, because I'm one of them, is supply you with data. And the challenge is that the data right now is not just limited to downloads, let's say, and streams, but it's also not standardized. And I know that NPR had a white paper about this a while ago, this idea of trying to create some standards, because right now, a number, and I can say this from personal experience, a number on SoundCloud and Libsyn and Feedpress, it's not the same number. Like the numbers, and it's hard to tell what the real number is, but they're not measuring the same thing so far as we can tell. And so therefore, even when you say this is a show with this many downloads, what downloads

means is unclear. Yeah, it's a problem. And there are the same companies that claim they can put in pixels will say, you know, hey, this show is doing one and a half million downloads an episode where it doesn't rank in the iTunes top 500 because they're saying if we tweet it and there's a Twitter uses the SoundCloud embedded player, then every one of this person's followers counts as a potential listen. So we're going to count those as listens.

That's literally the math they've been using. You know, we've seen shows move from Libs. That's literally the math they've been using. You know, we've seen shows move from Libsyn to SoundCloud and have their numbers go up. We've seen shows move from SoundCloud to Libsyn and have their numbers go up. And we've seen them both go down when they make those switches too. It's a problem. Everybody's trying to use some amalgamated algorithm, which is also the name of my cover band that looks at bandwidth usage by file and session length if you're streaming it on

the site and other variables to try to come up with what the right download number is. But it's impossible to really measure pure downloads. We get a surprising amount of shows who come to us and tell us, hey, we do 200,000 downloads an episode when they're measuring it just by server stats, not really since their server is chunking the file and they're getting a quarter or a fifth of what they think they're getting. And so we get to be the bearers of delightfully bad news for disappointed podcasters around the world. But it's a problem.

I like SoundCloud's numbers and I like Libsyn's numbers because I appreciate what they're trying to do and how they're trying to do it. And I think it's more exact than anybody can get on radio or TV, even though it's still clearly vague and inexact overall. I actually had one more thing before we go, which is Lex did leave that tantalizing point out there that there were things that we said that he disagreed with last week. Have we failed to cover some of those now?

Because this would be a good time for you to say, what we do you think that we got wrong i only have one minute but we covered the one which i think that you can use um that apple could give us access to listener data even without serving the files the only other thing is and this is i know this is way more than a one minute conversation but you guys on both shows this one in atp you guys talked about um how we don't want this to become like the web or like YouTube because those things are ruined. At the same time, I spend a lot of time every day on the web and on YouTube. And I understand what we're saying

when we say that the web is ruined or the YouTube is ruined, but it also still gives me a lot of joy, a lot of information and a lot of entertainment. So I recognize, and I like you, don't love advertisers trying to follow me around every website I visit and everything like that. But the fact that YouTube advertisers can get some kind of aggregated data about how many people

press the skip button versus how many people didn't doesn't bother me that much. It certainly doesn't negatively impact my overall YouTube experience. So I just wanted to put that out there that I know it's easy for us to say that YouTube and the web are ruined, but I still love both YouTube and the web. So I, there's- Yeah, but loving them for the content is very different to like, when we say ruined it's like the advertising business in those is significantly worse like youtube's cpms are horrific i that i get the only other piece i'll put out there is i like you we didn't talk about the idea of advertisers i'm sorry of podcast companies selling episodes um on itunes and how

like do you really want to cut? Like, that's not something that I'm personally advocating for. I'm not super interested in it. By the same token, advertisers who are trying to find ways to make more money for podcasts so that the like we have to we want these advertisers. We want podcast creators to find a way to make it profitable. Right. We can't say just, you know, just make great stuff and you'll make money is the same thing.

Like we can't, we shouldn't yell. I'm going to get a point eventually, I promise. We can't yell at developers who are putting out free apps or 99 cent apps and say, you're not building a sustainable business. Think about how to really make this big and, you know,

think that they're thinking about it wrong, but then turn to podcasters and say, guys, you're trying to think about ways to monetize this better. Just make great content. It's the same. It's really the same opposite sides of the argument being made in two different ways. Because I think that it's right and important for podcast companies to figure out, hey, what can we do to make these podcasts make more money? Because what I love about, I'm going way over time, I'm missing my next call, and you wouldn't believe who it's

with. But what I love about this job is the podcasters can make the shows because they're getting paid, right? Otherwise, they couldn't make this art. The listeners can hear the show only because the podcasters are getting paid. Like most hosts wouldn't be able to keep doing the show if they weren't making money from it. So the listener gets to buy in. And then the advertiser typically sees good results. So it's truly in that sense a win-win-win, right? The show exists because they're advertisers and the advertisers are happy because they can advertise on that show so when we see the podcasters are trying to figure out what can we do

to make more money it's the same thing the developers are trying to do right let me make this a subscription thing even though that's not what people are interested in necessarily they're like trying those pieces because they're trying to figure out a way to make it a sustainable business we're gonna do this forever this fundamentally ties into the misunderstanding or the difference in opinion between me and you is I agree with everything you just said. So I say leave it alone. Lex, thank you so much for joining us. It has been an absolute pleasure to have you. Where can people find you and the work that you do? The easiest place to find me is just go on Twitter and look for Lex Fry and then you'll

find everything from there because I'm all over the place. But this has been a delight. Thank you so much for having me on. Thanks, Lex. Lex, it's always a pleasure. You go and take that next call. Bye-bye. See you, Lex. Say hi to the president for me. I don't feel like we got anywhere, Jason. I could do that for another hour.

So I'm sure we'll continue to have this discussion. I, again, hope that everybody who said they liked this discussion last week enjoyed it this week as well. We have come to the end of our time for this episode. If you'd like to find some links for today, head on over to relay.fm slash upgrade slash 89. As always, you can find Jason's lovely work over at sixcolors.com, theincomparable.com,

and he is on Twitter at jsnell, J-S-N-E-L-L. I host many shows at the lovely Relay FM. I also sell the ads at Relay FM. You can find me on Twitter. I am at imyke, I-M-Y-K-E. Thanks again to our lovely sponsors who we hold so dear, MailRoute and FreshBooks. And thank you, as always, for listening.

And I look forward to receiving your feedback for this week's episode. As always, the best way is via Twitter. You can use the hashtag AskUpgrade or you can just tweet to me or Jason and we will find it. Thanks so much for listening. We'll be back next time.

Until then, say goodbye, Mr. Snell. Bye, everybody.