By Anne Steele 

Sirius XM Holdings Inc. is near a deal to buy E.W. Scripps Co.'s Stitcher Inc. podcasting unit for around $300 million, according to people familiar with the matter.

The satellite-radio giant is working to expand into the rapidly growing podcasting industry, following similar moves by media and tech companies including Spotify Technology SA and iHeartMedia Inc.

Stitcher runs a free podcast listening app and a premium $4.99 monthly service that lets subscribers listen to podcasts without ads. It also owns podcast networks including Earwolf and Stitcher Podcasts, with 50 shows including "Conan O'Brien Needs a Friend" and "Freakonomics Radio." In partnership with outside networks and shows, Stitcher distributes and sells advertising for more than 250 podcasts -- including "My Favorite Murder," "WTF With Mark Maron" and "Oprah's SuperSoul Conversations" -- through its Midroll Media advertising unit.

Sirius generates most of its revenue from subscriptions to its satellite radio service but in 2018 agreed to buy internet-radio streaming company Pandora Media Inc. for $3 billion -- adding a business more reliant on advertising and with podcast aspirations of its own to its lineup.

Last year Sirius signaled its intent to expand its podcast business with a deal in which Walt Disney Co.'s Marvel Entertainment is creating exclusive podcasts for the company's satellite radio and streaming services.

U.S. ad revenue from podcasts rose an estimated 42% to $678.7 million last year, according to the Interactive Advertising Bureau, and is projected to rise to $863.4 million this year and exceed $1 billion by 2021.

Scripps bought Stitcher in 2016 for $4.5 million in cash and then combined it with Midroll Media, the podcast-advertising company it had acquired the year before for $50 million.

Write to Anne Steele at Anne.Steele@wsj.com

 

(END) Dow Jones Newswires

July 06, 2020 19:11 ET (23:11 GMT)

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