One of the biggest stars in public radio recently declared that the time had come for the medium to "embrace capitalism." That's a pretty radical proposal considering National Public Radio markets itself as an alternative to mainstream commercial sources.
"This American Life" host Ira Glass made this comment at a presentation that podcasters held to solicit advertisers that was organized by NPR, Chicago's WBEZ (where Glass' show originates) and New York's WNYC. It was the first event of its kind and underscores the growing popularity of podcasts for public media. NPR data shows podcasting sponsorship revenue doubled from fiscal 2013 to fiscal 2014, and 2015 has already exceeded last year's take.
"Lots of public radio has been embracing capitalism for years," Glass wrotes in an email to CBS MoneyWatch. "Specifically: popular shows and popular podcasts and popular stations have been getting money from what we call 'underwriters' and what the rest of the world calls 'advertisers.' As our audience continues to boom, my hope is that the more money we raise this way, the less we have to beg our own listeners for donations. I'm guessing lots of listeners and managers in public radio share that hope."
Glass, 56, is in a unique position. His show spun off "Serial," is the most popular podcast in history. The program methodically examined the evidence in a murder case and found it to be lacking. "Serial" won the Peabody Award in 2014. The show's second season, which will focus on a different story, is set to be released this year.
Glass declined to provide specific financial information, though he did mention that underwriting revenue for "This American Life" has "increased dramatically in recent years and continues to climb." He stressed he was speaking only for himself and that he operates independently.
"Our goal is to make enough to produce the programs," he said. "If we make more than we spend in any given year, we plow it into special reporting projects and other projects for the programs. So in that way we're very different from a for-profit company."
NPR CEO Jarl Mohn, however, has set what the service calls "aggressive" goals to increase funding from corporations, foundations and philanthropists. Public radio stations depend on pledge breaks to solicit listener support, and J.J. Yore, general manager of WAMU in Washington, D.C., told CBS MoneyWatch that listeners dislike them.
"In fact, they drive away something like a third of the audience," he wrote in an email. "But I don't see them disappearing, at least in the foreseeable future because public radio needs every revenue stream possible."
Like every media outlet, the service is trying to reinvent itself for the digital age. According to the Pew Research Center's "State of the News Media 2015" report, weekly listenership dropped 4 percent to 26.2 million in 2014 from 2013. Meanwhile, the online audience for both NPR.org and station sites both saw double-digit increases in 2014 compared with 2013.
NPR.org's gain was 35 percent in 2014, which topped the 32 percent increase in 2013. The site's audience as of March was 22.2 million, an increase of about 5 percent from 21 million a year earlier, according to comScore.
Sponsorship revenue at NPR, whose shows include "All Things Considered," jumped 14 percent to $19 million in January and February, according to spokeswoman Isabel Lara. This represents a improvement from the drops NPR experienced from the 2012 to 2014 fiscal years.
Rival American Public Media, whose shows include "MarketPlace," is no stranger to capitalism, either. "While we're very comfortable with things that make money, it's not the reason we exist," wrote Angie Andreson, a spokeswoman, in an email to CBSMoneyWatch. Still, "We have seen a 60 percent increase in podcast revenue year over year," she wrote.
Ramping up sponsorship revenue may be easier said than done.
"Public media underwriting is different from advertising, and we often don't mirror what happens in the broader advertising market," Lara said. "For example we don't get election bumps, because we don't take political advertising. We don't allow price, offer or inducements in our radio or display creative, regardless of the economy."
Advertisers have less freedom in what they say on public radio than on commercial media, which can make sponsorships a tough sell, according to WAMU's Yore.
"Some companies understand the value of the audience they reach through PR despite these limits, others don't," he said. "Our overall corporate sponsorship revenue was flat for the fiscal year that ended April 30, but we are projecting a significant increase this fiscal year."