In the mid-to-late 2010s, the media industry witnessed a boom that analysts might not have seen coming: podcasts. Radio, an aging medium, was cool again. By 2019, about 90 million Americans were listening to podcasts every month, and venture capital brought in millions for new podcasting companies.

But that podcasting bubble didn’t last. Companies like Gimlet and Spotify, as well as public radio stations and NPR itself, ended up seeing big layoffs and small returns.

Micah Loewinger, a reporter for the public radio show, “On the Media,” covered that podcast bubble. He joined Marketplace’s Kai Ryssdal to talk about where this boom and bust came from, as well as public media’s role in the podcasting landscape. An edited transcript of their conversation is below, beginning with an excerpt from Loewinger’s “On the Media” episode. Loewinger is speaking with Nick Quah, a podcast critic and writer for New York Magazine about where public radio falls in all this.

Micah Loewinger: Nick Quah feels that by cutting much of their podcast-only shows, NPR and WNYC are setting themselves up for future failure.

Nick Quah: It feels like both organizations are receding deeper and deeper into itself when it should be unfolding wider and expanding and trying to really reinvent itself for the changing media landscape, demographic, and the world that it exists in. If you are not reaching new people where they are, you will not be here in 20 years. It is as simple as that. I’m sorry, I feel like I’m very angry. I’m coming out very angry and I am, but it’s like, boy, nobody’s asked me about this stuff for a while. I’m really pissed about it.

Loewinger: Why are you pissed?

Quah: Because I value public radio, I really value the enterprise of producing journalism and creative work that is for the public that is to a meaningful extent, disentangled from a pure for-profit, capitalistic structure. You are in a position to produce more interesting and better work. “On the Media” is one of the greatest shows of all time. If nobody’s out here being angry, trying to defend it, and think about its future, then what the fuck are we doing?

Loewinger: NPR, WNYC, LAist, these guys have been in the podcast game for a long time. They didn’t just dip their toes. They’re saying 10 years on of experimenting with podcasts, they’re really expensive to make. You got to pay those hosts so much money, you got to fly them all around the place to report these fancy stories. It didn’t work. Why are we chasing a unicorn when we’ve got old reliable over on 93.9?

Quah: Two things. One, old reliable is not going to be reliable forever. Something feels different about how fast things are changing in the way that we’re moving today. The second thing I’ll say about is that, did it fail because of the theory or did it fail because of the execution? I would argue it’s the execution. I’ll say it out loud. It does feel to a large extent like budget mismanagement

Kai Ryssdal: Okay, so there is, as I said in the introduction, a lot in that episode of “On the Media” to talk about, we got Micah Loewinger on the phone to do exactly that. Micah, thanks for coming on.

Loewinger: Thanks for having me.

Ryssdal: So as I also set up in the introduction, it’s not just public radio, which has been challenged by the economics of the podcast industry, right? Spotify, just in the last couple of days, we’ve seen the news. Here’s my question to you as we get going: how did the people who are in charge of the money, commercial or public broadcasting, get it so wrong?

Loewinger: I think it all started after the smash and unexpected success of “Serial” in 2014 where everyone wanted a big fancy hit podcast. And all of these companies, new and old, public radio and private, threw a bunch of money into podcast departments. And I think they quickly learned that the economics of this high-quality journalism is complicated. And I just don’t think the math panned out as many hoped it would.

Ryssdal: Let’s lay out the economics. You know the economics, I know the economics, but maybe not everybody listening does. What’s the main challenge here?

Loewinger: The main challenge is that we basically have this term podcasting, but it’s describing, roughly speaking, two very different things. One is the kind of journalism that I do at “On the Media” and that I love to listen to like “Serial,” like “This American Life,” like “More Perfect.” These are beautiful, carefully reported and scripted shows that require teams and lots of time to make stories. Then we have what is commonly referred to in the industry as the “always on” podcasts; the kind of chat shows, like Joe Rogan, or “Call Her Daddy” or “Pod Save America,” where you have you know, one, two, three celebrities or personalities who kind of shoot the breeze, can create a lot of content really, really fast and don’t require that much production, don’t require that much overhead. So the journalism, the really, really high quality, highly produced stuff is expensive to make. You can sell fewer ads, and, when there’s a big ad downturn like now, those shows, that business model, is really vulnerable.

Ryssdal: And we should say, and as you say in the longer episode, WNYC whence “On the Media” comes and KPCC “la based”LAist” in LA and the parent company of “Marketplace” APM have all had their challenges. I guess my question, though, is did nobody see this coming? It’s a little bit like the financial crisis, right? Home prices are only ever gonna go up. Podcasting advertising is only ever gonna go up.

Loewinger: You know, it’s probably a different story for every one of these shops. And I’m kind of just a little bit of a worker bee who’s seen it from the perspective of a producer. But I think so many people have tried to predict a hit in this industry, and the problem that we’ve seen is, one, it’s so hard to predict a hit, and, two, even the hits often aren’t making back the money that they put in. There was a fascinating piece from the Columbia Journalism Review recently that found that when Amazon and iHeartMedia and Sony would pour upwards of half a million dollars into a show, even if it was a hit and they had like a million plus listeners, they might only make half their money back. And this is not new. We have heard big leaders in the industry, like, for instance, the founder of Gimlet, Alex Bloomberg, describe this openly years ago. And yet, Spotify bought Gimlet hoping that they could spin the economics of this differently or differentiate themselves. And so it’s been out there.

Ryssdal: So look, if Spotify, which has spent a billion dollars on podcasting, which bought Gimlet for something like $200 million, which just this week canceled the show “Stolen,” which won a Pulitzer and a Peabody… if they’re throwing all this money at it, and can’t get it right, what are those of us in more traditional public media who like to make the longer, capital intensive, but really good, thorough investigative journalism… What are we supposed to do with that?

Loewinger: I don’t know. I’m asking that question, too. I mean, I’m looking around at some of my favorite hosts, like Jonathan Goldstein from “Heavyweight,” Anna Sale from “Death, Sex and Money,” Sam Sanders, formerly of NPR and Vulture, looking at them saying, “If these people can’t make it work, then who can?” I also don’t want to make it seem like podcasting is going away. Like, it’s obviously not. Listenership continues to grow. Projected advertising metrics show that the overall podcast advertising economy could double in the next couple of years. I just think that these companies are going to have to be much more judicious about who they invest in. And I hope they do invest because there are audiences for the shows. These shows are not being canceled because they failed purely to reach an audience or because they’re not good enough for something. It’s just we have to figure out how to balance the books. And that’s for a pointy-headed person at one of these companies to figure out. I couldn’t tell you.

Ryssdal: You know, I had a pointy-headed person, no aspersions being cast here, but a senior leader in this company say exactly that to me. “This show is extraordinary journalism, but I can’t sell ads against it.” You know?

Loewinger: “Marketplace?”

Ryssdal: No, no, not this show. A different show. Hopefully they can sell ads against this program.

Loewinger: I know you guys have struggled with ads, too, though. Hasn’t everybody?

Ryssdal: Everybody has. A word here since you mentioned “Marketplace.” And look, we have a podcast. Do listen to us on the radio, please. Do turn into your local station. But if you miss it on the air, we do have a podcast. But look, a word here about actual radio. It is instructive, I think, that three or maybe even more of the big-name podcasts that are out there, “The Daily,” “Today Explained” by Vox, some others, they have gone from being podcast products to shows on the air for broadcast.

Loewinger: Yeah, because public radio even though it is, in many ways, an aging medium, has some fail-safes built into it. We’re not quite as vulnerable to the big downturns in advertising because a show like “Marketplace,” a show like “On the Media,” we’re nationally syndicated, which means hundreds of radio stations across the country, every month, no matter what, as long as they’re keeping the lights on, they’re paying us for our show so we can lock that down. The radio business is way bigger than the podcasting business. The radio business, on the other hand, seems to be going down. It’s declining in listenership. We have an older audience. We have a less diverse audience than the overall podcast listenership. But we’re super predictable. And so even if we’re dying, like, a slow, slow death, there’s still a lot of juice to squeeze out of this.

Ryssdal: How much does it matter? Do you think that the podcast ecosystem is so atomized that the barriers to entry in the beginning are really, really low and, yes, distribution becomes a problem if you want to get circulation and all that, but you can do a podcast if you want to do a podcast?

Loewinger: It’s a good question. I think, on one hand, having a mega mega hit like, you know, Joe Rogan or “Pod Save America” or whatever, we’re gonna have fewer, I don’t know, like, giant culture-changing podcasts that are something like TV in the 60s where there were only three channels and so these personalities had outsized influence. I think lots of people are experimenting with developing an audience that is maybe not going to be ginormous, but is going to pay them, you know, five-plus more dollars a month on Patreon. There are lots of really niche podcasts that are going to be around for a long time and might even make their hosts a lot of money just by figuring out how to extract money from the people who really care.

Ryssdal: This episode that we’re talking about of “On the Media” is about the end of the first boom in podcasting, which kind of implies that you, I guess, expect there will be a second boom even though we’re kind of in a bust right now.

Loewinger: Well, part of the reason that we got to this bust, I think, is that the picture for overall growth in podcasting was far too rosy. People expected to make their money back too fast or whatever. So I’m wary of saying that, you know, “Oh, this boom just ended and the next one’s about to start.” That would be foolish. But I think the fact is that people love to listen to podcasts. We know that this is a part of people’s daily media diets. And I think that once the kind of macroeconomics of this moment settle, maybe when advertisers are, you know, eager to come back to our shows, when interest rates are maybe lower, then perhaps we’ll see more spending, more creation of these shows. And I don’t think this is going anywhere. But I think we have to be more careful this next time around. I think that’s the big lesson.