Facebook Pulls The Plug On Podcast Business After A Year: Report

Facebook is pulling out of podcasts and plans to remove them altogether from the social-media service starting June 3.

Part of Meta Platforms Inc., Facebook will stop letting people add podcasts to the service starting this week, according to a note sent to partners. It will discontinue both its short-form audio product Soundbites and remove its central audio hub.

Facebook announced various audio efforts last April during a hot market for podcasting and audio in general. But the company’s interest has waned, Bloomberg News reported last month, and it’s now focused on other initiatives, disappointing some providers.

“We’re constantly evaluating the features we offer so we can focus on the most meaningful experiences,” a Meta spokesperson said an email. The person added that they didn’t have a specific date on when Soundbites and the audio hub would shut down but it will be in the “coming weeks.”

The spokesperson characterised the move as a matter of concentration. The move will help Meta "focus on the most meaningful experiences," according to the representative.

In the note to partners, Facebook said it doesn’t plan to alert users to the fact that podcasts will no longer be available, leaving it up to the publishers to decide how they want to disclose that information. Live Audio Rooms will be integrated into Facebook Live, meaning users can choose to go live with just audio or audio and video.

There were hints in recent weeks that Meta was losing interest in podcasts and shifting attention to hotter products like Facebook's main feed and Instagram's Reels. There was a good response to audio services, a Meta spokesperson told Bloomberg in mid-April, but the news outlet's sources said the social media firm was more interested in highlighting the metaverse and shopping when talking to podcast partners. Simply speaking, Meta's interests in conquering AR, VR and rivals like TikTok may have pulled its attention away from audio.

The podcast market has grown crowded in recent years. Spotify Technology SA has both licensed hit shows and acquired companies. Amazon.com Inc. purchased the podcast network Wondery and also a hosting platform. The live audio platform Clubhouse was valued at about $4 billion last year and every tech company wanted to copy its product.

Meta had to pit Facebook's services against the likes of Twitter Spaces and Reddit Talk.

That made Facebook’s entrance look inevitable, but only a year later the platform and its parent company Meta are heading in a different direction.

The company changed its name to Meta to emphasize its interest in building the metaverse and is also now pushing users toward short-form videos called Reels to compete with TikTok.

Meta said in its earnings report last week that Reels now make up more than 20% of the time spent on Instagram. Though the stock tumbled in February, it rebounded after financial results came out.

Meta reported its first quarter earnings on last Wednesday, meeting expectations on revenue but missing on earnings per share. Still, the social media giant added users, and shares were up 13% in after-hours trading.

In a turnaround from its historically bad Q4, Meta reported that it added users across the board — daily active users increased 4 per cent to 1.96 billion. Last quarter, the company's main Facebook app lost 1 million daily active users.

What's more, Meta reported that it expects its total 2022 expenses to come in between $87 billion and $92 billion, less than the $90 billion to $95 billion the company previously announced.

Still, the company missed on second quarter revenue expectations, with the company saying it will see between $28 billion and $30 billion, just shy of the $30.74 billion Wall Street was calling for.

Meta's latests report coming off of a historically bad Q4, during which the social media company announced that Apple’s iOS privacy changes, called App Tracking Transparency, crushed its ad revenue. According to Meta, ATT, which allows users to determine if they want their apps to track them across the web, will cost Meta as much as $10 billion in 2022.

Shares of Meta have plummeted 41% in the last three months, compared to a 4% drop for the S&P 500.

Meta is also plowing billions of dollars into Zuckerberg's grand plan to transform company into a metaverse-powered behemoth. Reports indicate that Meta will show off new headsets in the coming years with the hopes of eventually monetizing the metaverse to compensate for slowing overall growth.

To top it all off, Meta is facing competition from the likes of TikTok and Snap (SNAP), and continues to contend with an ongoing antitrust lawsuit from the Federal Trade Commission.