Regardless of how you feel about Joe Rogan, one simple fact is indisputable: The comedian-turned-podcaster has a massive audience. That's partly why shares of Spotify (SPOT 2.55%) have soared to fresh 52-week highs -- levels not seen since 2018 -- after the Swedish music-streaming leader announced this week that it had scored an exclusivity deal with Rogan for The Joe Rogan Experience (JRE) podcast as part of its ongoing push into podcasts.

Here's why the partnership is such a big deal.

Spotify reception desk at headquarters

Image source: Spotify.

Rogan's following is enormous

Spotify has spent the past year fleshing out its podcasting strategy, challenging Apple's (AAPL 1.66%) long-standing dominance in podcast distribution. Part of that initiative entails securing original content for the platform, and in no uncertain terms JRE will become the biggest exclusive podcast for Spotify's audio-streaming platform.

JRE, which has never been available on Spotify thus far, will debut on the service on Sept. 1 before becoming completely exclusive in late 2020. The streaming tech company notes that Rogan will retain full creative control over the podcast even though Spotify will become the exclusive distribution partner. The show will be available to all of Spotify's 286 million monthly active users (MAUs), including both free users and paid subscribers.

Not only is that a blow to Apple, but also Alphabet (GOOG 0.72%) (GOOGL 0.83%) subsidiary Google, as Rogan's channel on YouTube has nearly 9 million subscribers, with each episode typically garnering around 2 million to 3 million views each. Certain episodes that feature high-profile guests like Elon Musk can enjoy a much larger audience (Musk's appearance on JRE last week has 13 million views). Clips will still be available on YouTube, but people will have to go to Spotify for full episodes.

The media personality has previously disclosed that JRE is downloaded 190 million times per month. "That number's crazy," Rogan told fellow podcaster Aubrey Marcus a little over a year ago. Rogan also has 6.1 million followers on Twitter, and 9.5 million followers on Facebook's Instagram.

Financial terms around the partnership were not formally disclosed, but the deal is reportedly worth over $100 million, according to The Wall Street Journal. Spotify's market cap increased by $5.3 billion in the two days since the announcement.

Spotify's "Howard Stern" moment

In some ways, the JRE deal loosely resembles SiriusXM's original exclusivity deal with Howard Stern in 2006, another provocative media personality with an enormous -- and loyal -- fan base. That arrangement was widely considered a blowout success for both Sirius and Stern. One notable difference between the Stern and Rogan exclusivity deals is that SiriusXM requires a subscription, allowing the company to better recoup its costs, while Spotify offers an ad-supported tier.

That being said, Spotify has grand plans to modernize podcast advertising with dynamic ad insertion technology that can leverage Spotify's user data for more advanced ad targeting than is currently available in the podcasting space. Ads will never bring as much money as paid subscriptions, but Spotify has said the growing podcast catalog has bolstered conversion rates of free users to paid subscribers.

Time will tell if this move pays off, but chances are it will in spades.