Why Netflix Is Stealing Podcasts from YouTube

0:28The Colin and Samir show is supported by Shopify. and you want to launch a business, there's truly never been a better time to be an entrepreneur than right now. So if you want to check out Shopify, you can get a free trial at shopify.com slash Colin and Samir. And you can have a conversation with Sidekick. There's a new chapter in the battle between Netflix and YouTube. And this battle is for who gets to be the first app you open when you turn on your TV. Now, YouTube is winning this battle right now, commanding 12.8 % of TV watch time while Netflix commands 8%. So what is Netflix doing to try and gain some traction?

1:05Podcasts and podcasts, obviously a big growing concern. Netflix now wants a big piece of that industry and they'll probably end up reshaping the industry as a result. Through a partnership with Spotify, Netflix is going to serve as the host platform for video versions of popular podcasts that are out there. Notably, the deal is going to block these podcasts from airing in their entirety on YouTube, which is, of course, Netflix's biggest competitor. Now, for Netflix, it's actually a relatively cheap experiment, but a strategic one for them to try and win back some of that time that they've lost to YouTube.

1:41Netflix CEO Ted Sarandos has been crystal clear about his position on YouTube. He says Netflix is in the spending time business. YouTube is in the killing time business. But with this move into podcasts, sounds like he wants to get into the business that YouTube is in. Seems like this guy wants to kill some time. So Netflix moving into video podcasts. Does this actually matter? We think it does. Let's talk about it.

2:13All right, so let's just first set the stage for what is happening here with Netflix and video podcasts. Then we'll talk about it from our perspective, like from a creator's perspective, why someone would do this. Talk a little bit about the audience and then talk about the future of podcasting. But first, let's talk about what exactly is happening. So Netflix is officially treating podcasts as a programming category. And what that means is they're commissioning original video podcasts and they're licensing existing hit podcasts from other networks, specifically starting with Spotify. So it's a big deal with The Ringer, which brings 16 shows over, and they're trying to get to like a high volume of podcasts.

2:54Now, this actually is really similar to their early TV strategy, where they were combining a mix of originals, but mostly licensed titles on Netflix. So interesting, they announced that they're planning to promote the podcast directly inside the Netflix app, and they're making product updates and UI changes so that podcasts are more discoverable and that they don't get buried. I think that's, I'm curious what that's going to look like. But one thing they note in the article is that it's going to include vertical video. So the only other piece of context that you need to know is these deals are intentionally low cost because obviously that's good for Netflix, allows them to just test a lot of different podcasts.

3:34They need volume of shows right now. These are one year and under$10 million, which allows Netflix to really spread like these deals out across a ton of podcasts. the most important thing here is that every podcast Netflix licenses cannot go on YouTube in full bingo it can go on Spotify video but it can't go on YouTube they they're allowed to have like social clips and like up to a certain minute count but you cannot do the full show on YouTube so they are doing this because people like me do not even think about opening Netflix until the end of the day. That is the only time. At the end of the day, I'm like, all right, I've got some free time.

4:17Maybe I'll watch something on Netflix. Maybe I'll watch a show. I'll watch a movie. But at that time, in that category, there is actually so much competition because I'm watching shows on Apple Plus. I'm watching shows on HBO Max. You call it Apple Plus? What is it called now? Apple TV? Apple Plus, dude? Yeah, it's called Apple TV. Whatever. These things change all the time. Oh, it's called Apple TV+. Exactly. Okay. The team in the room is called Apple TV+. I didn't know that. I didn't know that. Carry on. My bad. My bad. My bad. There's Hulu. There are so many options in that category of I'm finally sitting down on my couch.

4:53What should I watch? But what they want is people waking up every day and thinking about Netflix the way people think about YouTube, which is there's something new for me every single day that I might enjoy. I think, yeah, I think that's true. I think they also want what I did after watching Severance, which obviously is on Apple Plus, Apple TV Plus. Watching Severance on Apple, like right after I wanted to watch commentary podcasts about like explaining some of the theories and what was going on. And I go to YouTube to do that. And so I think obviously the, probably a part of this is, hey, we have great titles.

5:32after you're watching one of our shows, can you watch a podcast about the show? Like an after show. Like you look at The Walking Dead, you know, they had The Talking Dead, which was a really successful podcast about the show. So that's one category of podcasts that makes sense to me on YouTube. And I think The Ringer deal - You mean on Netflix. Sorry, on Netflix. The after show makes sense. The after show makes sense for Netflix. And I think The Ringer is a great example of that. Like this Jake Paul, Anthony Joshua fight that's going to happen in December, this boxing match, or another sporting event.

6:05Obviously, they had the NFL game. You have a Bill Simmons live show afterwards or a pod breaking it down or a watch along with them. There's a lot of energy to talk content on Netflix that I agree with. Especially if it's an exclusive event, like the Jake Paul boxing. I think that's a different type of thing. If it's exclusive, if there is a reason to specifically listen to this talk show or this podcast, at this specific time, it makes perfect sense that it's behind a paywall at Netflix. Now, the Colin and Samir show is supported by Shopify. All right, Colin, the holidays are coming up. What kind of discount should we give people on the Press Publish store?

6:455%. Where did you come up with that? I don't know. Just out of my head. Okay. Well, I'm going to go with a trusted source here. I'm going to open up our Shopify dashboard and click on Sidekick, which is Shopify's new AI business partner. All right, I'm going to ask the same question to Sidekick. Here's the suggestion. Let's do a tiered approach for maximum impact. So early bird, peak season, and last minute. So early bird is 15 % off. Peak season is 20 % off. And the last minute, right before Christmas, 25 % off for urgency. Interesting. All right, so if you're listening to this right now, then we're going to have Sidekick implement one of these discount codes.

7:19So we'll start with this early bird. Use HOLIDAY15. It's live. And that was all done with the help of Shopify Sidekick. Okay, 15%. That's a lot more generous. That's good. That is three times the discount I was going to get. Listen, if you're listening to this, Colin didn't want you to have 15 % off. I just, I don't know where that number came from. Here's the thing. If you use code Colin5, you can get 5 % off. How about that? So if you run a store on Shopify, then Sidekick is your AI business partner. You can chat with Sidekick, get insights into what's going on with your store, and actually collaborate to come up with strategy and execute on that strategy.

7:54If you don't run a store yet and you have an idea, there's truly never been a better time to be an entrepreneur. So check out shopify.com slash Colin and Samir for a free trial. All right, back to the show. What's harder for me to get my mind around is the like long form talk show on Netflix. So like Diary of a CEO or Call Her Daddy weekly on Netflix. That is pretty hard for me to wrap my head around. Now, let's zoom out here and talk about all of this from like a creator perspective because these are deals under$10 million for one year. The era of podcast deals that we saw a couple years ago, which likely created the podcast boom, was the like$120 million, $60 million deal for Alex Cooper, the original one, and then eventually being 100 plus million.

8:46Stephen Bartlett turning down$100 million. I'm like, we are seeing... the biggest shows get deals to the tune of 100 million. Yeah, I mean, those were irrational deals. When we spoke to Daniel Ek, he said the reason for those deals was to inject energy into the podcast space so that more people would want to make podcasts because there's this big incentive, there's this big dream of getting the big deal. Yeah. He didn't say they did those deals because the economics made sense. So I think to that point, like the biggest podcasts I don't think are going to go over here because for creators to take your show off of YouTube, like let's say you're Theo Vaughn, there's no way in$10 million you're taking your show off YouTube.

9:33There's no way. Or if you're Andrew Schultz, like any of the comedy pods, I don't see it. You know, maybe I see it with a bunch of the Ringer shows, largely because if we look at the average viewership, so Bill Simmons podcast, probably one of the bigger ringer shows most episodes on spotify video are doing somewhere between like 400 600 000 views but on youtube they're doing 85 000 views so like you lose the bill simmons show on youtube it's kind of like okay and you're still allowed to upload clips yeah you still upload clips so it's like all right you can still find a lot of brand awareness a lot of distribution clips could still go viral across platforms so then like a five to ten million dollar deal that's good i think that's totally fine and i think it makes a ton of sense and obviously like Like across the whole Ringer network, they're getting like a lot of shows that include the F1 show, the Ringer fantasy football show, the Ringer NFL show, the Ringer NBA show, conspiracy theories, which I think is really interesting, which is like their true crime serial killer show.

10:32Like that fits right in with like Netflix docs and Netflix content. Yeah. And even like the F1 show can play after Drive to Survive. The NBA show can play after Starting Five. Yeah. Right. Like there's corresponding programming on Netflix that these shows can play after that may keep you on Netflix longer than you would have before. Right. To get to the volume of content they want, they want between 50 and 75 video podcasts in 2026. So the licensed show model, I understand for a media company like The Ringer, it's very hard for me to get there with a top creator or even like with us. Like maybe I would consider taking our show off of YouTube, but that would mean that my belief is that the long form video podcast is kind of over the hump of cultural relevance.

11:20Right. And I do want us to stay on that point for a second because like, I think it might be. i think i think it might be i think there are a few people who are exceptional in the long video podcast but i think most industries trail two years behind cultural relevance and i think that is that might be something we're seeing here with netflix they're making a decision based off of the conversation around podcasts a couple of years a couple years ago Yeah. Yeah. That is kind of what I'm feeling. Like, I don't think they're looking around the corner. Yeah. Like the podcast election happened. They're like, oh my gosh, we've got flagrant.

12:04We've got Theo Vaughn. People are talking about podcasts. Everyone's watching podcasts. They're moving culture. Let's acquire podcasts. Yes. Yeah. So that is one of my thoughts is that they are being reactionary to something that was something of the past and not looking forward. But as two guys who make a long form podcast. Yeah. Why is the long form podcast over the hump?

12:27I think it's just the scale of them. Like I think, you know, these are not Netflix sized audiences that we're talking about. Right. So I, I, maybe I don't understand what, what a win means for Netflix, but my assumption is you need millions of people interested in the thing. The thing about video podcasts, they speak to niche audiences. So the mass audience podcast, I guess is what I'm talking about. The mass audience video podcast, the ones that can drive the Rogan style audience, which is really just Joe Rogan. But diary of a CEO is a close second to like scale. I don't know that we'll see like a new diary of a CEO or a new call her daddy.

13:03It's hard for me to get there. But I think the, you know, like, I don't think it's, I think it's a feature, not a bug that the rewatchables does an average of 36 ,000 views on YouTube. So that, that's what I mean. I guess Like the video podcast as a format does drive cultural relevance, but the way a Netflix is going to approach it, I don't know if it's going to have the same impact because what is great about niche programming is that it's readily accessible to the people who are interested in it. You can find your community, you can find your niche topic anywhere. But the second you put it behind a paywall like Netflix, the expectations from Netflix are going to be pretty big in terms of how many people or how many subscribers are enjoying this content and is keeping them on the platform.

13:51Like, I don't know if 30 ,000 people are really into a video podcast on Netflix. Are they happy? Is Netflix happy? Yeah, is Netflix happy? I have no idea. I think we are over the hump because we have seen everything there is to see when it comes to podcasts. If you're a celebrity that people are interested in who can get other celebrities on the show, then I think you have a shot, like SmartList or Amy Poehler's Good Hang. But outside of that, I think it's super difficult to come up with something new that captures a lot of people's attention. In my opinion, it's just the first step in a very long journey for Netflix to look a lot more like YouTube.

14:27It's just a small step in acquiring a batch of programming that is more current, is more tapped into the cultural conversation because YouTube has a massive advantage in that I know multiple times a day, every day, I know YouTube has something new for me about what is happening in the world. Netflix does not have that. And if they want people opening up Netflix more often, spending more time there, they need to have programming that is more relevant to the pace that the world is moving. So part of me is like uncomfortable opening Netflix right now and thinking about seeing a lo-fi podcast. I told you earlier, it reminds me of like when you are flying on an airplane and they've licensed 12 podcasts and you're just like, why?

15:20Why are these 12 podcasts here? I think it's like out of context. Like I want a high quality show. I want a movie and I think it'll be uncomfortable at first, but I think this is part of a move for Netflix years potentially down the line to get to a point where they have enough relationships with enough creators that are putting out content way more frequently at lower costs. I also think if we just look at precedent here for, you know, podcasts getting pulled from YouTube, it has happened before when Spotify did the deals. Spotify pulled Joe Rogan off of YouTube. Do you remember this? Yeah. And he was just exclusively in a subscription environment of Spotify or a subscription and ads environment of Spotify for a very long period of time.

16:02He recently came back to YouTube. He is, in my opinion, more relevant now. And that is better for Spotify. Yeah. Right? And so I think we've seen this movie before where you go pull it off of YouTube, you know, and like just go - The franchise is better off if it is on YouTube. Yeah. But at the core of it, like, especially when I think about the concept of Netflix launching original shows, It's like, wait, so you're not going to put this out on YouTube? Like Netflix, if you're making a podcast, you should probably put it out everywhere. Yeah. Because we're all in the game of just overarching relevance and connection with an audience.

16:37And again, as a creator myself, if my goal is reaching the most amount of people or just being relevant to the most amount of people, I would prefer to have the shot on YouTube. now the one part that i have noticed is that podcasts including ours are more volatile on youtube than they've been in the past it's it is like we are fitting into an algorithmic discovery platform with youtube and so you have some pods like like um theo von which can find its millions and millions of people no matter what um but even even within theo like the volatility from episode to episode, it can be pretty dramatic.

17:15And so, you know, again, just to stick it with like the creator mindset here, I do think if our belief is that actually clips are better suited for YouTube, right? Like if our belief is actually, hey, a more pointed part of my podcast was just a better version of a YouTube video, which I kind of believe. Yeah. It's easier to discover. Yeah. Meaning instead of putting out a three hour episode with Emma Chamberlain, we do like, you know emma chamberlain unpacks her rise on youtube and that is like a 22 minute clip from our podcast that lives on youtube and then the full length discussion is somewhere else like maybe that's a future that could work um but this is just like it's hard for me to wrap my head around the incentives for top creators here uh i i do get it for like you know the broader subset of a creator media company or a media company.

18:08I get why you would do this. Are you bringing up volatility because you think licensing the podcast would be a solution to volatility? If we're putting out our podcast on YouTube, we're getting a lot of viewership volatility. That's tough for an advertising business to have that much volatility. There could be some comfort in, oh, you know what? Let's license it for a flat fee. We know we have that money coming in. It's just stability. Exactly. Stability. We'll take it off YouTube because at least we have financial stability. That's why I bring up volatility. Because I think from the creator perspective, if you're looking for stability, this could be a move.

18:38Just like license the show and just, you know, it's all good. They'll handle distribution. But I don't think they're going to be looking at creators of that size. That's true. Right. Like, I don't believe they're coming. That's the push pull, yeah. If we are experiencing any sort of viewership volatility. I don't think they're coming to us and being like, hey, why don't you? I guess I even mean, though, I think the Bill Simmons spot is a great example where it's like, yeah, he's got a four to six hundred thousand person audience on Spotify. but he's got an 80 ,000 person audience on YouTube. You know, even that's like almost a level of volatility.

19:08Now, one of the reasons, you know, that seems pretty obvious of why Netflix needs more of this type of content is because they're ads business. It's not just about subscriptions, it's about advertising. And podcast is one of the most acceptable formats in media to put multiple ads into, right? Like you can really put a lot of ads into a podcast. And with Netflix being in the advertising business more recently, live events, and then what is a cheap form of programming that you can put a lot of ads into? Podcasting. So it's obvious why they're going into it. But again, it's harder for me to wrap my head around the creator reasoning of why I would engage in it.

19:52Let's talk about the audience perspective here. and like how do audiences engage with podcasting on netflix like with this being an obvious reaction to youtube right and like netflix has has said explicitly that youtube is their biggest competitor outside of sleep um how do the audience how does an audience engage with this new world of netflix with Netflix podcasts yeah again I know personally I don't believe that I will is just flat out my personal answer as someone who does watch Netflix like for me YouTube podcasts are just too accessible and too good at finding me and anything that I do. There is a YouTube podcast that will find me.

20:49Like I'm watching an NFL game. I'm following like Shador Sanders and his rise in the NFL right now. I know YouTube has not only the highlights of him, the press conference, but talk shows like it just everything will find me. I don't have the confidence that Netflix will ever have that for me. There's an important thing here that podcasts are, are pretty regional too. So what you're saying is obviously on a more micro level of like your own algorithm, but it's also important that what, what I was saying before of like podcasting is for a niche audience. It's for you to find your people. And so Netflix is making like international hits a lot of the times, right?

21:32Squid Game is a great example. I guess it's an international hit. Like how, how are they going to react to more like regional programming? Even like Jake Paul, Mike Tyson is pretty international. Yeah. Right. Like when you are getting two people conversing about a niche topic or something like that, you are taking your audience and going like, here is the total addressable market of this audience. Yeah. From an audience perspective, I said this earlier, but I think the only way they get me is through an exclusive. So let's say I'm watching Drive to Survive and you find out that Lewis Hamilton is going to be switching teams.

22:06He's leaving Mercedes and you want to hear him talk about it. 6 p.m. right on this day we're releasing a full episode with our talent exclusively to Netflix. Yeah. And then you get to also like watch him switch teams in Drive to Survive and then the podcast is part of the show as well. Like I think they need to create the shows that have the exclusives for their own franchises. I don't think you need a podcast for that. I agree. I know that that is I think that's a video. That's an interview. It's an interview. It's not a podcast. And I think that is talk content they should invest in. They should invest in talk content.

22:48Of course, they need to build IP within talk content. But I don't know if you need 75 podcasts on Netflix. I think I, as a viewer of Netflix, I'm going to log on and be like, I don't know what's going on. What are they doing here? What's going on right now? What is your perspective on what I'm supposed to do when I arrive at Netflix? That's why I bring up the airplane, the back of the seat, because you're like, wait. I can play this like weird Tetris game that's not called Tetris or I can watch one of these 12 podcasts. Exactly. And I think that is, uh, that, that is, that is already an issue with Netflix, in my opinion.

23:22And when, when, when you're on the airplane and you get overwhelmed by your choices, for me, I just ended up watching the office because I I'm overwhelmed by how many choices there are. So the Netflix is going to have the same issue is you're going to get overwhelmed by how much content there is. And then you're going to end up just watching comfort food or just moving on and going to YouTube. Yeah, because there will be too much content without a perspective, without a POV of what content is supposed to look like on Netflix. So some of this, you know, brings to light this question of where does podcasting go?

23:56Like, what is the future of podcasting? You know, one thing is we did talk to someone who works at The Ringer and they said one thing that has been challenging in this push towards getting themselves Netflix ready is you got to shoot the pod in 4K. You got to increase the quality, right? Like you're not going to see Zoom podcasts on Netflix, right? I don't think so. I can't imagine you're going to see Zoom podcasts. You're going to see like high quality looking shows. And so you're going to increase the production load on weekly shows. And what we know is like adding video to this podcast changed the whole thing completely already.

24:34And when you add like, okay, it's got to be 4k and we got to nail this like visual production i do think it's going to get more challenging and you see some of the greatest shows like even call her daddy sometimes she's just in her hotel room sitting on her bed delivering you call her daddy and that's what's wonderful about it but i i don't think i can imagine that in in on netflix yeah it's funny because i think i want that on youtube and i'm okay with it but i don't want it on netflix yeah like i want chris williamson in Modern Wisdom where he rented out an entire studio and made it look like a farm and had McConaughey.

25:11I agree with you. Like hundreds of thousands of dollars to put together an incredible production. But the great thing about Chris Williamson and Modern Wisdom is his last episode is in like an office room. Yeah, that's not the constant. And sometimes he is in his bedroom and does a Q &A. And that's the thing is like creators are a lot more, you know, we're just... We'll do anything. You don't know what you're going to get. I do hear you. Week to week, we could do anything. I think the ringer and being Spotify owned, they can handle this production responsibility. Right. But I think the second you do this with true independent creators and podcasts, you're about to see some wild stuff on Netflix.

25:49I don't know if that's a bad thing or a good thing. Maybe it makes it more interesting to open up Netflix. Again, I think this is just the path, the beginning of a long road towards Netflix making its users and the audience okay with it looking more eventually like YouTube. So I do want to bring up the TikTok deal with iHeartMedia. So Netflix is not the only one, you know, making some deal in podcasting. Podcasting seems to be what everyone wants. Like it is, it's what every company wants to solve. And TikTok and iHeart have partnered to launch the TikTok Podcast Network. And it's a podcast studio and a radio channel where TikTok creators host podcasts distributed by iHeartMedia.

26:31From the press release, here's a quote. The launch of the TikTok Podcast Network, which will feature up to 25 new podcasts hosted by TikTok creators, as well as a national broadcast and digital radio channel and a series of live event integrations. TikTok radio. On TikTok radio, listeners will feel like they are scrolling on TikTok, but with their ears. That last line, I don't understand. I don't get that either. Wait, I actually need you to break down everything you just told me. Okay, so basically what's happening is TikTok is launching a podcast network where they're going to take their talent, TikTok creators, and build shows around them that will be distributed through iHeart's radio stations, like real radio from iHeart, meaning in cars and whatnot, plus digital distribution through iHeart's network.