A friend pointed out an article in our local Boulder newspaper today about a local Podcasting business called ClickCaster. I don't know any more specifics about this company than what is in this article, but from my read I'd say ClickCaster will have a hard time making much of a business with their current model. I pursued an idea in the Podcast space several months ago - and after pushing and pulling on it every way I could (and getting some very good advice from my VC friends) I abandoned the business. I thought I'd share my analysis of why, in my opinion, Podcasting is not ripe ground for a start-up.
First, I think all these podcast searching/enabling business models are flawed in similar ways (this is the point that my VC friends impressed on me). Perhaps these businesses can create a nice little niche business, but the real bucks are going to go elsewhere.
For instance, Apple has a new, relatively inexpensive software called Garage Band where the Mac controls all the sound mixing etc. With a single click you can upload your recording (podcast, or even song, anything audio) to your .Mac account - a service owned by Apple - and presumably to iTunes. Garage Band and the rest of the iLife software does many things that ClickCaster claims to do. I don't think Apple is going to be less dominant, as he states; rather I think they will become even more dominant in the Podcasting space. It's possible, perhaps even likely, that Apple will get challengers on the iTunes side, but they own podcasting and desktop software seems better positioned to take this market, rather than service-based businesses.
Second, assuming that there is a niche for service-based business models in the podcasting space, ClickCaster has to deal with Odeo and many other competitors. Odeo is a venture-backed company, and is listed in the Boulder Daily Camera article as one of his competitors in this space. There are - by my rough count - eight VC-backed Podcast companies very similar to ClickCaster. These companies have raised 10's of millions of dollars. You don't want to be caught competing against that with shallow pockets.
Next, iTunes has a terrific podcast network, where you can subscribe and automatically load your iPod with Podcasts. It gets deeper every day, and it's tightly integrated with iPods.
Finally, service businesses on the web tend to be "winner takes all" businesses. Just look at eBay - nobody ever uses Yahoo Auctions, because eBay has all the users. If you have the users, you take the whole thing. iTunes has all the users (+90% I think was the number published last month), and a Band or Commentator wanting to use Podcasting to get their message out is going to go where the users are - and that ain't ClickCaster network, or even Odeo for that matter - it's iTunes.
Podcasting is fun, empowering, and really could take off, but I don't suspect that podcast enabling service-based companies are going to be very successful.