Podcasts: Hot or Not

Are podcasts hot or not? Charlene Li, an analyst at Forrester Research, in her controversial report says its not. She points out that a mere one percent of online households are regularly downloading and listening to podcasts. That number will be around 700,000 in 2006, she predicts. (Those who disagree with her point to The Diffusion Group report.)
I think its easy to work yourself into a lather over Li’s report, but I see it as a glass half full. Sure it is a highly fragmented market, but still, that’s a large pool of listeners and certainly larger than the number of users on most Web 2.0 start-ups.
If you look at the iTunes podcast page by popularity, you see more and more mainstream fare, like ESPN Radio. People know NPR or ESPN and are comfortable with downloading familiar or favorite shows, aka time-shifted radio posing as podcasts. I have argued about this before, but Don Dodge does a better job of explaining the problems with podcasts.
I do a weekly podcast with Niall Kennedy and one thing I know – it is hard work. You really need to bring a value proposition to the table, and hope that listeners like it. We will soon touch 700 listeners, and given the feedback we get, they actually listen to the weekly show. For me, that’s pretty darn good. Who cares if they add upto only 0.1% of all podcast listeners!
Update: James Enck: On demand radio is going great guns in Europe and in UK. He points to BBC data. Maybe we should stop calling them podcasts?