As a means of communications, podcasting has certainly exploded in popularity as a way for consumer and tech companies to reach their constituents.
One area where podcasting has been slow to catch on is investor relations, but that may be changing.
"I wouldn't say investing folks aren't going out there and using podcasts and PR folks are," says Farrell Kramer, founder and president of Farrell Kramer Communications. "PR folks are finding uses for it a little more quickly."
A major apprehension about podcasting is the inability to retract them. Companies want to be sure investors are making decisions based on the most recent information. Once downloaded, podcasts can be kept indefinitely.
"A podcast is a file," says Andy Janoschka, director of product management at Vcall, a product line available through WILink, an online IR company. "It takes up space. It's likely that people are not going to carry around a podcast for a year."
Janoschka pinpoints "the convenience factor" as a main reason for using podcasts. "Analysts [can] take them on the train or when they're flying," he says. He adds that the convenience also affects shareholders, many of whom will not have the time to listen to the number of earnings calls that often take place within a short period of time, but can download a podcast to listen it when they have the time.
Podcasting offers companies of all sizes the ability to reach a large audience, important especially for small businesses that need to compete. "Podcasting is just another method of broad distribution," said Janoschka. "It's another way to increase visibility."
Vcall reported 82 clients using podcasts in Q3 2005. For Q3 2006, that number was 314. While podcasts can serve a number of different functions, the majority of its clients used it for IR communications. Moreover, the number of podcasts being downloaded has skyrocketed: 6,200 in the second half of 2005 versus 37,500 during the first nine months of this year.
"Not only can [podcasting] become useful to investor relations," says Kramer. "It should."
Podcasting has been slow to catch on as an IR tool
Podcasts are portable and can increase the visibility of small companies
There is concern that podcasts allow dated investment information to continue in circulation