As Spotify begins reorganizing its podcast division, the company announced another round of layoffs. The music streaming platform is merging two podcast networks, Parcast and Gimlet Studios, into a “renewed” Spotify Studios department. As a result, Spotify’s Vice President and Head of Podcast Business Sahar Elhabashi released a statement earlier today saying this merger will cut hundreds of jobs within the podcast division.
“Our senior leadership team has worked closely with HR to determine the optimal organization for this next chapter. As a result, we have made the difficult but necessary decision to make a strategic realignment of our group and reduce our global podcast vertical and other functions by approximately 200 people, or 2% of Spotify’s workforce.”
Vice President and Head of Global Podcast Studios, Julie McNamara, will lead Spotify Studios, along with Liliana Kim in charge of Current Content, Liz Gateley as Head of Development, and Bill Simmons as Head of Podcast Innovation and Monetization.
“We are expanding our partnership efforts with leading podcasters from across the globe with a tailored approach optimized for each show and creator. This fundamental pivot from a more uniform proposition will allow us to support the creator community better.”
Years ago, Spotify spent millions to purchase several podcast networks to beef up its content library and veer away from strictly hosting music. Spotify bought Parcast for $56 million and Gimlet Media for $200 million, but unfortunately has not grown its original podcast-based revenue enough to support its current number of staffers long-term. The company already had to cancel almost a dozen podcasts last year.
In January, Spotify laid off 600 employees, with Spotify’s CEO Daniel Ek citing he had been “too ambitious in investing ahead of our revenue growth.” He will be refocusing the company towards efficiency in hopes of reducing operational costs while building up Spotify’s revenue streams. Spotify previously had 9,808 employees, reduced by 6 percent by this round of layoffs.
Along with both rounds of layoffs, Spotify sent them off with a “generous” severance package and additional support, including extended healthcare coverage.