Social Audio App Clubhouse: Trend Or Unicorn That Will Fade To Black Soon?

Being an international speaker, I get a lot of questions about the social audio app Clubhouse: Is the fresh Unicorn a trend, or is it a hype that will fade to black soon? Great questions that I will try to answer here for you.

I love to share strategic insights, contextual intelligence, and to make predictions. In this story, I will talk about the future of Social Audio and Clubhouse in particular.

Before I deep dive into Clubhouse, I will share my vision on the future of social audio. So first some contextual intelligence.

Video Killed The Radio Star – But Will Video Kill The Digital Audio Star?

Remember the famous hit by The Buggles from 1979? Video killed the Radio Star? Have a look and listen. I predicted 12 years ago, that TV and Radio in their current formats would keep losing younger audiences.

 

Linear listening and live broadcasting are indeed being replaced by on-demand. Especially Generation Z and Millennials have swiped live TV out of their lives. They want to be in control, and content is on their terms. I call them #screenagers.

They love to binge on Netflix or YouTube. They also like to listen to their music on platforms like Spotify, YouTube, and SoundCloud. Or listen to audiobooks and podcasts when it suits them.

Tough competition for the Radio Networks too.

Same as traditional TV has been losing younger audiences to Netflix, Disney+, Amazon Prime, local Video platforms, and global platforms like YouTube and TikTok.

Disney+ recently topped 100+ million paid subscribers. We are talking about yearly digital revenues of around $7 billion per year! With an ARPU of $70 USD per sub per year.

Paper books and long-read stories are losing too. But audiobooks are very popular among broader audiences. Does it matter if they read or listen? Nope. Who made the rules anyway?

Radio now also needs to compete with podcast platforms. Also, with live and interactive social audio networks like Clubhouse.

Long story short? TV Networks were in denial for too long. They called Netflix and hype and YouTube stupid cat videos. Watch new generations. They will swipe out TV and Radio and they will love stupid cat videos and binging series.

As you can see, the Mad Men generation is again in denial. That goes for TV and Radio Networks, as well as Ad and Media agencies. I stated back then in my talks at Cannes Lions Festival:

Disruptive innovations always come from outsiders and outliers. Never from the people within these industries. We have been doing it like this for 20 years, is the most killing phrase for innovation I’ve ever heard.

The ad and media people in Cannes laughed out loud. Award-winning Art Directors said that my predictions were outrageous and that I was crazy. I nearly made it out of the audience Q&A alive…

Look where we are today. I hope you will coin these trends to flip your funnel.

Scale your personal branding and Fan ARPU with new digital and hybrid business models.

Now is the time.

The Future of Social Audio, Podcasting & Beyond Joe Rogan’s $100 Million Deal With Spotify

As a speaker and a voice of reason, I have been speaking a lot about social audio and podcasting, of course. I’m very aware that a huge part of my fans loves to be entertained and educated via their ears.

For my audiovisual-oriented fans, I’ve upped my signature visual storytelling skills. I use TV shows, YouTube shows, and next-level VR and XR recording studios. Expensive content, I can honestly admit.

And for a smaller group of my fans, mainly business leaders aged 40-55 years, I also write stories, guest articles, and blogs. My long reads (1.500 – 2.000 words) perform better than my short reads (600-800 words).

Written stories have long-tail power, and they boost the cornerstone content on my blog. Feeding the beast called Google and pushing my SEO rankings is essential for my long-term personal branding and also my business objectives.

Here’s a long read I wrote one year ago. Just before the launch of Clubhouse: Digital audio and podcast popularity will be off the charts by 2025.

The story will give you trends, predictions, new business models, and how the emperor of podcasting Joe Rogan inked his $100 million deal with Spotify.

What I later learned from Joe Rogan, is how YouTube was censoring some of his podcasts on their platform. But a week ago, Rogan also confirmed that Spotify censored his earlier shows. In this piece, Rogan said:

There were a few episodes they (Spotify) didn’t want on their platform.

What did I learn from my past at WPP GroupM? Fans on lease is a dangerous long-term social media strategy. Dangerous in ways of short-term thinking. Tactics only, not even close to a strategy.

DJs with millions of fans can only connect to 5% or less of those fans. Because social networks like Facebook are squeezing and EdgeRanking.

Is it the most clever strategy? To keep focussing on fans on lease? Why not create owned media platforms and opt-in e-mail and mobile databases?

I try to re-route all my social media fans into my owned membership program, my newsletters, and channels I own. If you hear my talks and voice of reason, you will understand why I’m being censored by YouTube and Facebook a lot.

Covid-censorships and propaganda even made freedom of speech worse. I don’t trust social networks. They have been taking down entire channels during the Pandemic.

I also wrote this review on the docu TheSocialDilemma. Summarized? Great work, but too much focus on #screenagers. The Netflix docu missed out on the opportunity to warn us of the next threats.

What will Big Tech do when tech is morphing all around us? I have been warning about it for a decade now:

Technology can empower or control humanity. Ethics and human rights need upgrades fast. I warned for the rise of big tech – totalitarian technologies – social credit systems.

It’s also my first Freedom of Speech and Privacy/GDPR warning for everyone that is or will jump on the social audio bandwagon. There are risks you should be aware of.

I will share more about the privacy issues Clubhouse can expect. You will not believe it at first.

Clubhouse The Next Big Thing In Social Media? Or A Unicorn That Will Fade to Black Soon?

What’s the Clubhouse buzz about people? Clubhouse is a social media —audio-based app. A live-streaming network meets podcasting meets Snapchat. Or Part talkback radio, part conference call, part Houseparty?

Drop in at any room at any time and listen. room anytime. Up to 5,000 users in one single room.

Can you imagine Elon Musk in a panel about crypto? You could tokenize the tickets.

Talks disappear forever – as soon as they finish. So when you step into a room too late? It’s live audio. You have missed a part, and there’s no listen-back or on-demand. Gone with the wind!

Content is also not transcribed and thus not offered as plain text either. Better pay attention. Or record the talk. And AI transcribe it yourself. Oops.

Clubhouse is available for iPhone only, and it has been excluding Android users since day one. And today, it’s still day one.

You can download the App from the App Store, but it’s an invite-only network. Ask your peers to invite you.

UX started off dramatically, and mechanisms were crippled. But tweaks and buzz around the coffee machine because innovators were bragging about their new toy. Yup. You’re a cool dude!

Several audiovisual friends and fellow misfits – asked me to do a video review as well. Here you go. My opinion on Clubhouse.

 

Clubhouse was officially launched in April 2020. Clubhouse currently has 10 million weekly active users, according to a town hall meeting hosted by CEO Paul Davidson.

That’s impressive, considering the platform is still iPhone-only and had just 2 million users in January 2021. And only 1,500 in May 2020.

Clubhouse is currently available in 154 countries (the iOS App Store operates in 175 countries).

And the app is starting to gain traction outside of North America.

In fact, Clubhouse is currently the #1 most-downloaded app in Germany, Japan, Slovakia, and Turkey.

Clubhouse has raised over $10 million to date. Over 180 organizations and venture capitalists have invested in Clubhouse to date.

The social audio app is currently valued at $1 billion (up from $100 million in May 2020). With its $1 billion valuation, Clubhouse is now a Unicorn startup, joining the ranks of Uber and Airbnb.

Recently, valuations of $4 billion were mentioned in the media. If that is microwaved air or market-making? The crazy growth has stopped and Twitter Spaces has launched a (really shitty) audio service.

Clubhouse is currently ranked #5 in the App Store under the “Social Networking” category.

What Can You Do At Clubhouse?

People can host and join rooms or chat like a digital café.  Of course a perfect tool during a global pandemic.

I call it the Netflix or Zoom effect. I expect Zoom to hit 300 million users in 2021. Show me the money!

I’m sure brands and digital storytellers who strategize the use of Clubhouse are going in for big wins.

For people building audiences it’s serving as a conference, for hipsters, it’s another conversation at the club, for knowledge seekers it’s a source of rooms and classrooms filled with massive information.

For speakers and artists, Clubhouse could be used for private or fan-only events.

For brands, Clubhouse offers opportunities like a quick live show in the morning. The audio version of Morning Brew.

Let your limitless mind and imagination do the work.

Is Social Audio App Clubhouse Making Money Yet?

No, it is not. Clubhouse is still pre-revenue. Clubhouse will roll out beta tests for monetization options sometime this year.

Specifically, they will focus on a crowdfunding model that pays creators directly vs. display ads (like Facebook and YouTube).

That’s what Tech Crunch recently wrote.

This is a story I recommend reading later: The revolt against the 30% Mafia.

When did Big Tech gatekeepers from Apple to DoorDash decide they were entitled to a third of the internet’s sales?

Artists can break free. Maybe Clubhouse will offer them an option?

What Do I Like About Social Audio Network Clubhouse?

For artists, it’s a perfect tool to interact with fans and increase fan loyalty. I have hosted several sessions. Sometimes with one guest like a Fireside Chat. Often with more guests and then the Room is like a talk show.

Of course, we invite the audience to interact and to ask us questions. The live audience Q&A. The USP for Clubhouse users. Interaction and engagement. Social aspects and easy to access.

At least if you are invited. And if you have an iPhone in your pocket. In a few months, Clubhouse will also open the red carpet for Android users.

Clubhouse is voice only. So you don’t have to be camera-ready. Forget your make-up artists. Handy for the millions who dislike being on camera or video.

The audio-only experience makes this a fascinating and fantastic medium. You can hop in while you’re driving or brushing your teeth. And join the conversation by raising your hand and being called on stage.

It’s easy and fast to set up or to join Rooms. The mobile App offers a handy interface and UI.

You can follow me via Burning Man Meets TED aka @igorbeuker.

The algorithm will get you more on digital marketing, trends, tech, and entertainment if you follow me.

What I Do Not Like About Clubhouse?

In my opinion, Clubhouse could improve its web platform a lot. Searching and matchmaking (topics, peers, etc) could be much smarter. It would improve relevancy for all users.

Come for the tool, stay for the network platforms, depend on smart tooling and relevancy.

I do not like the fact that all content and conversations are getting lost immediately. It destroys long-tail content opportunities at the door.

The fact that Clubhouse is still excluding all Android users? Not brilliant for many reasons. That’s not inclusive at all.

If this pandemic has finally faded, will the Clubhouse popularity plummet again? That’s what many of you have asked me recently.

If Clubhouse fixes the above issues fast, they might be OK. It might also end like MySpace or Snapchat, stuck in the middle.

People might just hop into Twitter Spaces. Remember, Twitter has an installed base of 351 million monthly active users (MUAs).

In this piece,  you can find a comparison between Twitter Spaces and Clubhouse.

Even with Android users onboarded, Clubhouse could still die out slowly. Or fast.

But it’s the lack of privacy at Clubhouse privacy that is worrying me the most.

Clubhouse Needs To Step Up Its Ethics On User Privacy. We Don’t Need Another Facebook Scandal

The more important question for long-term shareholder value is? Upcoming privacy issues. I expect lawsuits if Clubhouse does not take action on its lack of privacy. The EU is already investigating its GDPR compliance.

Clubhouse Is Recording Your Conversations. But Not For You. Read That Again.

All Clubhouse sessions are live broadcasts, and you cannot record them. So after the session, your Room will be empty, and all content will be gone. Bye-bye to on-demand opportunities and sayonara long-tail power.

So why is Clubhouse recording your talks? What do they do with your conversations?

There’s a huge privacy / GDPR issue with Clubhouse. Users can not delete conversations that Clubhouse recorded. And users can not even delete their own accounts. Help

Just take a good look at the Clubhouse privacy terms of use and its privacy statement. They say they are deleting conversations after a while. Maybe you should check it first?

I wrote about the dangers to society during the Facebook Cambridge Analytica scandal. Leaking political preferences of people to shady regimes and dictators? That’s dangerous!

And Zuckerberg and his team seem to be repeat offenders. Myanmar? Facebook also sided with Turkey’s government demands.

I’m not saying Clubhouse has terrible intentions or ethics. But they could easily be sharing our conversations with i.e., China or Russia. More about that in this piece from Inc.

What I’ve learned during the global pandemic? Data don’t lie; politicians and leaders often do.

France and Germany are already investigating Clubhouse for GDPR violations. This is a possible violation in France, and the DPA council in Germany launched this press release on Clubhouse.

In my opinion? A serious matter of ethics. I hope not as bad as Zuckerberg’s Facebook data lies.

Conclusion

The social audio space can be compared to the social networking industry, but it will have faster adoption as it sits on top of existing smartphones and apps.

Audiobooks, social audio, and podcasting will continue to grow into a very nice niche. The market needs to mature, and more Joe Rogans are needed.

Audio social network Clubhouse is quickly taking off. It has already achieved Unicorn status. And, based on its rapid rise in valuations, it is becoming a VC darling. But for how long?

Whether Clubhouse goes mainstream (like Instagram) or sort of fades (like Snapchat) remains to be seen. So it will be interesting to see what the future holds for Clubhouse.

The fact that Clubhouse still needs to prove its monetization skills worries me. I have too many crappy business models so far. One-legged business models or advertising-only business models.

WeChat is a powerhouse app with several business models. Worth looking at when creating the next-level business models for Clubhouse.

Post-pandemic, Clubhouse could continue to grow and finally start making money.

But if Clubhouse doesn’t fix its attitude on privacy, it might be a dead man walking sooner than expected.

I would love to read your ideas and feedback in the comments below.

See you at Clubhouse soon!

 

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We all know the mainstream media is often full of propaganda and bribed journalism. Big Tech makes it even worse with its content censoring, fake fact-checkers, and fading social channels to black. Should I add #fansonlease, walled gardens, and squeezing artists like lemons to the toxic social media list?

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About the Author

In the spotlights, Igor Beuker is a top marketing innovation keynote speaker and futurist known for his foresight on trends and technologies that impact business, economy, and society. Behind the scenes, a serial entrepreneur with 5 exits and an angel investor in 24 social startups. Board member at next-level media firms, changemaker at Rolling Stone Culture Council, Hollywood sci-fi think tank pioneer, award-winning marketing strategist for Amazon, L’Oréal, Nike, and a seer for Fortune 500s, cities, and countries.

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