How Spotify started — and killed — Latin America’s podcast boom

In July, the podcast Mujeres Valientes won the Gabo Prize, a prestigious Latin American award for audio storytelling, and became a symbol of the success of Spotify’s podcast strategy. The feminist series about an Indigenous community in Oaxaca was one of many podcasts in the region backed by Spotify, garnering critical praise on the heels of massive regional investment.

But over the last two years, Spotify has backed away from investing in podcasts. The company has wound down contracts across Spanish-speaking Latin America. More than a year after its release, the award-winning Mujeres Valientes is still looking for funding to make a second season, producers told Rest of World .

This is one small example of the global fallout from Spotify’s haphazard rush into — and out of — podcasting. In the United States, the world’s largest podcast market, the company invested hundreds of millions of dollars — only to later reverse course, canceling beloved shows and laying off hundreds of staffers. Yet, in the U.S., Spotify was merely one among many players. In Latin America, the company was so dominant that its name is synonymous with the podcast boom itself, as well as the bust that podcast producers find themselves in today.

“Many of these companies depended on Spotify’s budgets to make podcasts, and now they have come to a halt in production because they don’t have those budgets and they’re going to have to rethink what they have to do,” María Jesús Espinosa de los Monteros, head of audio for Spanish media giant Prisa and the person who handed the award to Mujeres Valientes , told Rest of World.

Spotify did not answer whether it would fund a second season of Mujeres Valientes , which was hosted and created by Nayelli López Reyes, a 25-year-old Indigenous Triqui woman. “We are incredibly proud of what creators like Nayelli have been able to accomplish through participating in Spotify’s creator programs, and we are always eager to support creators in achieving their dreams,” said Nacho Gil, head of marketing and podcast in Latin America, in a statement to Rest of World .

Spotify was a relative latecomer to podcasting, but what it lacked in timing it tried to make up for in scale. In 2019, the company spent nearly $400 million acquiring Gimlet, Anchor, and Parcast: companies that had flourished after the runaway success of Serial . Spotify CEO Daniel Ek said it was part of an “ audio-first ” strategy — a plan to become “the leading producer of podcasts.”

On a call with investors in 2019, Ek clarified that “while our acquisitions have been focused on English-language content, I don’t think you should read in too much to the fact that that’s an English-only strategy. It’s very much a global strategy.”

By the end of that year, three of the platform’s top five podcasts were its own productions in Germany, and the company was promoting new shows in India, Mexico, Brazil, Colombia, and Argentina. Spotify’s earning reports began to intermittently cite the number of original podcasts released outside the U.S.: There were 26 in the last quarter of 2019, 58 in the third quarter of 2020, and 100 in the second quarter of 2021.

The new shows brought Spotify new listeners around the world, but the effect was particularly dramatic in Latin America, where it became the podcast platform for nearly everyone. A 2024 survey found that 90% of listeners in the region use Spotify for podcasts. Comparable surveys found that only 39% of urban Indians listen to podcasts through Spotify. In the Middle East and North Africa, a 2020 survey put Spotify’s share at 26% , second only to Apple.

Spotify’s dominance of podcasting in Latin America is, in part, a reflection of how niche podcasts were in the region before the platform’s arrival. “We had a couple articles in newspapers about the boom of podcasts and Serial , but that was it,” Argentine audio producer Mariano Pagella told Rest of World .

As a result, there was no local equivalent of Gimlet that Spotify could simply acquire. So Javier Piñol, then Spotify’s head of studios for Latin America, started commissioning individual shows from independent producers. Before those phone calls, many of these producers saw podcasts more as a passion than a career.

“Here, it’s almost like Spotify constructed the industry,” Luciano Banchero, co-founder of the Argentine podcast studio Posta, told Rest of World . (Posta produces Rest of World ’s Long Reads audio series .) “I’m talking about Argentina, but it applies to Mexico, to Chile, to Colombia.”

The budgets were small compared to the U.S., but they could be as much as five or 10 times what was typical locally, Banchero said. Suddenly, podcasting looked like a viable way to make a living. Professionals from film, radio, and advertising adopted the new title of “podcast producer.”

The volume of shows commissioned by Spotify quickly escalated. “[Spotify’s head of studios for Latin America] said, ‘Hey we need more podcasts,’” said Banchero . “ And I remember we sent a deck with eight shows, and in like an hour, I remember he responded and said, ‘We’ll do all of them.’”

The listenership for Radio Ambulante — a popular Spanish-language podcast of stories from across Latin America, founded in 2012 — rose from under 30% to 45% in the region, while its Spotify listeners went from 8% to 46%, CEO Carolina Guerrero told Rest of World . Two-thirds of those Latin American listeners were concentrated in countries where Spotify had focused particular attention: Mexico and Colombia. “We have more listeners in Latin America due to Spotify’s expansion there. So many people discovered us there,” Guerrero said.

As late as April 2022, Spotify was telling investors that it was going to spend several more years significantly investing in original content. Spotify’s expansion, though, was about to come to an abrupt halt.

By 2022, like other ad-driven tech companies, Spotify’s stock price was beginning to fall, and the prospect of a near-term payoff from its bet of more than $1 billion on podcasting looked increasingly implausible. By October 2022, it started canceling shows and laying off producers in the U.S.

During an investor call that month, Ek said, “This heavy investment that we’ve done on the podcasting side is going to reverse in 2023.”

At first, some producers in Latin America remained optimistic. Even if the global strategy was shifting, Latin America remained what investor-speak calls an “emerging market” — where expenses are lower than elsewhere, and there is more potential for growth in the number of listeners.

“Despite big shake-ups in the industry, at Studio Ochenta we know that 2023 will be the year podcasting’s biggest stars cross the audio channel to Europe, Latin America and Asia,” Lory Martinez, founder and CEO of Studio Ochenta, the producer of Spotify’s award-winning fiction podcast La Cabina Telefónica , wrote on LinkedIn in early 2023. “Spanish language podcasts will save and elevate podcasting in 2023,” she said in a subsequent post .

The optimism didn’t last long. Latin American producers told Rest of World that Spotify did not officially communicate the change in its policies to them. “There were little signs. Contracts that weren’t renewed,” Banchero said .

Contracts that were already signed still lurched forward, and, in 2023, Spotify went on to produce shows like the Gabo Prize-winning Mujeres Valientes and three other podcasts that won the prestigious Onda Prize  in Spain. Two prize-winning Spotify Originals remain on the platform’s “top podcast” charts at the time of writing: Meterse al Ranch o (number 20 in Colombia) and La Cruda (number 8 in Argentina). All of these shows published their last episode in 2023, and none have announced plans for a new season. The host of La Cruda , which has over 770,000 followers on Spotify, now hosts a daily streaming show on YouTube .

Both the former head of studios for Latin America and the producer hired to run the office in Buenos Aires have parted ways with Spotify in the last nine months. Both also declined to comment on the record when contacted by Rest of World .

The statements about this volte-face have become more and more clear in the last year and a half. In 2023, Ek admitted to “overpaying and overinvesting” in original content and presented the death of Gimlet and Parcast as a “new phase.”

That has left podcasters in the region reassessing their business — and reconsidering how much the market can really support. Rest of World found producers who were looking for work or pivoting to video, as well as others who were sustaining themselves making podcasts for non-Spotify clients — who were often attracted by their past work for Spotify.

“More than a moment of crisis, I think that it’s a market correction,” Espinosa de los Monteros of Prisa told Rest of World . Her company will be investing more money in 2024 in Latin America than it did in 2023, although still far less than Spotify did at its peak.

“Clearly, no one is going to invest as much as Spotify,” she said. “But really, and this happens with bubbles, maybe the market didn’t need to invest so much.” ▰

Stan Alcorn is an investigative reporter and radio journalist based in Bogotá, Colombia.