Joe Rogan ditches YouTube for Spotify, shares gain 8%

Shares of streaming audio company Spotify Technology SA (NYSE: SPOT) hit a new 52-week high of $179.69 on Tuesday after announcing the signing of podcasting legend Joe Rogan.

Who is Joe Rogan?

Rogan is a comedian and mixed-martial artist color commentator but perhaps best known for hosting one of the most popular podcasts on YouTube called “The Joe Rogan Experience.” Rogan has been hosting a wide variety of guests on his show. Among the more notable shows in recent history is Tesla CEO Elon Musk who famously smoked weed during a 2018 taping and a 2019 interview with Twitter and Square CEO Jack Dorsey.

Rogan boasts one of the most loyal and engaged fan bases in the world as the host is known for welcoming guests of all political persuasions. He is a strong advocate of freedom of speech and expression and combines elements of his comedic background with a passion for mixed martial arts.

The Spotify deal

Spotify has been making a heavy push into the podcasting business as a way of differentiating itself from rival streaming audio platforms who focus exclusively on music. Needless to say, landing a major name like Rogan will be seen as a victory for the Swedish-based company and a loss for YouTube.

As of September 1, Rogan’s show will be broadcast to Spotify users, both paying and non-paying members. The host will leverage his YouTube page by offering clips and other content with the purpose of advertising the full show on Spotify.

The logic behind the deal is likely to gain direct exposure to the tens of millions of Rogan fans who will follow him to any platform. Spotify hopes a percentage of these new users will ultimately purchase a recurring membership or at the very least generate ad-related revenue.

Investors appear to be optimistic about the deal despite the price tag on the agreement remaining a mystery. Shares of Spotify closed Tuesday’s session up more than 8% on a day when major indices sold off towards the end of the session.

Spotify’s stock is now up close to 15% since the start of 2020 while the S&P 500 index is down close to 10%.

Rogan comments on the deal

Rogan said in a YouTube video his multi-year licensing agreement implies he will not be an employee of Spotify and there will be no changes to the show’s format. 

“We are going to be working with the same crew, doing the exact same show,” Rogan said. “The only difference will be it will now be available on the largest audio platform in the world.”