Dive Brief:

• Amazon Music has acquired the podcast distribution and monetization platform Art19, according to a statement on its website. The Verge first picked up the news.
• Founded in 2015, Art19 offers a platform where clients can manage both their content and ad operations in one place. Performance dashboards track how listeners are engaging with campaigns in real-time, measuring impressions and downloads based on standards certified by the IAB Tech Lab. The company also operates an Ad Creative Studio to assist with creative strategy and production.
• Art19 inserts premium, host-read ads across programs including the "Late Night with Seth Meyers" podcast, Bravo TV's "The Daily Dish" and "Watch What Happens Live with Andy Cohen" audio tie-ins and "Doug Loves Movies," among others. Amazon snapping up the firm signals it has larger ambitions in audio advertising as rivals like Spotify and Facebook hit the gas on similar initiatives.

Dive Insight:

Amazon is attempting to round out its podcast advertising suite with the Art19 acquisition as the audio advertising category at large grows more competitive. Financial terms of the transaction were not disclosed.

Art19 focuses on helping partners distribute their content, better target their ads and manage campaigns in real-time to optimize performance. The company's WarpFeed tool tracks whether listeners are downloading an older episode of a program and inserts messaging that is up-to-date. Art19's goal is to bring the same level of granular marketing capabilities common across digital to the podcast space while sitting at the intersection of publishers and advertisers, according to its website.

With the acquisition, Amazon continues to ramp up podcast dealmaking, an attempt to close the gap in an area where it's a relative latecomer. Late last year, the e-commerce giant bought the podcast network Wondery, which is responsible for popular shows such as "Dirty John." The deal, reportedly valued at over $300 million, was centered on securing more exclusive premium content after Amazon Music introduced a podcast section in September.

Amazon's moves mirror those of rival Spotify, which is also looking to areas of audio advertising beyond music streaming as a means to diversify revenue. Spotify in recent years has purchased a slew of podcasting companies, including publishers Gimlet, The Ringer and Parcast, as well as the production studio Anchor and audio advertising company Megaphone. Last week, it acquired the startup Podz that uses machine learning to boost podcast discovery.

Spotify in February also introduced an audio advertising marketplace, called the Spotify Audience Network, that aims to simplify the process of running campaigns across its properties. The company at the same time is integrating podcast listening tools into Facebook, which could broaden the reach of its programs and help it better tap into existing fan communities.

Some analysts remain skeptical as to whether podcasts will play out for Spotify, despite the proliferating number of bets. Amazon, on the other hand, doesn't really need podcasts to thrive, and instead could be viewing the category as a way to further fortify a booming digital advertising business. Amazon's "other" revenue segment that includes advertising sales surged 77% year-on-year to $6.91 billion in the first quarter of 2021.

Advertising revenue for podcasts grew 19% year-on-year to $842 million in 2020, bolstered by a 37% gain in the fourth quarter, according to a recent analysis by the Interactive Advertising Bureau and PricewaterhouseCoopers. The category at large is expected to surpass $2 billion in revenue by 2023, the firms found.