Updated, Monday afternoon, with statement from WGA East regarding the cuts.
Spotify is laying off 200 workers from its podcast division, or about 2% of its total global workforce, the company said in a memo disclosed publicly Monday. Spotify VP and podcast head Sahar Elhabashi wrote that the cuts are part of a strategic shift to expand partnership efforts “with a tailored approach.”
“This fundamental pivot from a more uniform proposition will allow us to support the creator community better,” Elhabashi wrote. “However, doing so requires adapting; over the past few months, our senior leadership team has worked closely with HR to determine the optimal organization for this next chapter.”
Spotify cut 6% of its overall workforce earlier this year, including Dawn Ostroff, who stepped down as chief content and advertising business offer of the company’s podcast business.
As a part of the latest restructuring, Elhabashi wrote, Spotify will merge its Parcast and Gimlet groups into a “Spotify Studios operation” to produce originals. Spotify canceled nearly a dozen underperforming originals late last year.
The Ringer division, acquired by Spotify in 2020, will remain a semi-independent venture headed by Bill Simmons.
In a statement Monday afternoon, members of the Writers Guild of America East affected by the cuts issued a statement:
As of today, Gimlet and Parcast no longer exist. Spotify informed us this morning that we have been absorbed into Spotify Studios. Spotify also laid off 200 people today, including many workers unionized with the Writers Guild of America, East. This comes on top of sizable layoffs last year.
We’re heartbroken – again – for our coworkers who have lost their jobs. And we’re frustrated by the mismanagement that led us here.
When Spotify purchased Gimlet and Parcast for nearly $300 million, they acquired an incredible group of talented people with specific and marketable skills. Then, they wasted that opportunity: canceling shows with dedicated audiences, leaving half-finished projects to die on the vine, and giving teams little direction as to what they actually wanted to see produced. Spotify also made many of our shows exclusive to the platform, limiting the amount of revenue our studios could bring in. This has been tacitly acknowledged by Spotify, as leadership have since reversed that decision. Beyond missteps in programming, Spotify also refused to fund Parcast’s DEI Committee as stipulated in its union contract.
Gimlet was a pioneer in the podcast industry, producing ambitious, genre-defining shows, some of which became household names – shows like: Start Up, Reply All, The Habitat, Sandra, Motherhacker, Homecoming, Crime Show, Resistance, Conviction, Not Past it, and so many others. These were shows that turned people into podcast listeners. Some formerly Gimlet shows will continue production. But all will be affected by today’s loss. Spotify acquired Gimlet because it saw something special in the studio. But instead of building on that legacy, the company undermined it, and four years later Gimlet is no more.
Likewise, Parcast has produced numerous popular shows with dedicated audiences, including Serial Killers, Conspiracy Theories, and Supernatural with Ashley Flowers. Their always-on weekly format helped set standards in the industry for good and for ill. Our unit members and non-unionized colleagues regularly put in late nights, weekends, and holidays to meet grueling deadlines. Sadly, the majority of those employees lost the jobs they toiled at so tirelessly. Our final months were plagued by a lack of direction and transparency, confusion, and announcements that were backtracked hours or days after being made. While Spotify has yet to announce any Parcast cancellations, the recent layoffs demonstrate an unwillingness to invest further in some of their most popular, long-lived shows and the people who made them.
Gimlet and Parcast were studios with vision that helped shape our industry. Whether Spotify Studios has a vision remains to be seen.