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Almost overnight, podcasting has become one of the UK's favourite buzzwords, and Tony Blair, David Cameron and Ricky Gervais have all got involved. But media owners and brands are also starting to get excited about its potential as a new way to reach time-poor consumers.

The word itself is something of a misnomer: you don't have to own an iPod to listen to a podcast. In essence, a podcast is an audio or video ("vodcast") programme that can be downloaded from the internet on to a computer or MP3 player.

The Ricky Gervais Podcast, based on the first series of The Office, last year entered the Guinness Book of Records as the most popular podcast ever, with 4.5 million downloads, prompting Gervais to switch the second series to a paid-for model for which he charges 95p per episode. Blair and Cameron, meanwhile, have both had interviews podcast by The Sun and The Daily Telegraph respectively.

Gervais' success isn't the norm, but even though most podcasting gets hundreds rather than millions of downloads, it is looking like it might become a genuine medium. Radio companies have been quick to get involved, making highlights of popular shows available as podcasts. And newspaper publishers too have embraced the medium, creating content specifically for a podcast audience.

It is the concept of audio on demand that is making podcasting so popular.

As personal video recorders do for TV, podcasting enables people to listen at a time that suits them.

Guy Ruddle is the podcast editor at The Telegraph - to date the only person to hold that role at a UK national newspaper. He says consumers like podcasts because of their convenience and flexibility. "Radio has always been the most intimate medium, but this goes one step further," he adds. "You can take it with you and you can do other things while you're listening. Podcasts have all the intimacy of radio with all the flexibility of newspapers." Add to that the fact that podcasting is not a particularly expensive thing to do and it's easy to see why media owners are rushing to get involved.

While broadcast costs are minimal, production can be more expensive.

Unlike radio companies, newspapers don't have a ready stock of audio content - they have to create their own. Both the Telegraph Group and The Guardian have invested in podcast studios and The Guardian has hired a radio production company to train its journalists in the basics of scripting and microphone technique.

Publishers are now investigating various methods in an attempt to make money out of the medium. Most podcasts are free, but some media owners have started to charge for content. The London radio station LBC, for example, charges £2.50 per month for podcasts of its full-length programmes and estimates that it makes a 40 per cent profit on that. And if all of the people that downloaded the first series of the Gervais podcast also download the second series, the show could reap a staggering £4.28 million in revenues. It's already at number three in the iTunes podcast chart (see box).

Most publishers, however, feel that advertising or sponsorship is a better route to take. Last month, The Guardian launched four new podcasts backed by Volvo, in what the paper claims is the biggest UK podcast sponsorship deal to date.

The Telegraph does not, as yet, run commercial messages during its series of podcasts, but Ruddle says his personal view is that sponsorship is the right way to go. "There is something very personal about podcasting because it's downloaded and delivered straight into people's ears, which means you are going straight into their space. In that context, I think sponsorship is fine, but I have more concerns about ads. It's possible we will need a new advertising model."

Other podcasters take a different view. Virgin Radio - the first UK radio station to produce a daily podcast, in March 2005 - runs radio ads early on in most of its podcasts. According to James Cridland, the Virgin Radio director of digital media, advertisers have included Mastercard, Orange and Bose, which used the space to promote its iPod speakers.

"Probably the most interesting use of the slot was an ad from COI for Special Constables," he says. "It was looking for people with spare time to volunteer, so where better to advertise than on an iPod that is being listened to during people's spare time?"

Because the cost to Virgin is low - most of its podcasts consist of highlights of programmes such as Christian O'Connell's breakfast show - this "podvertising", as the station has dubbed it, means its podcasting is already in profit.

And Cridland agrees that the medium offers possibilities beyond the traditional radio spot. "Podcasts are not governed by the same rules as radio stations.

Product placement, for example, can be more overt, so, in the future, we could consider things like incorporating advertising messages into the podcasts themselves," he says.

Podcasting for newspapers

According to recent research from the Association of Online Publishers, more than half of UK publishers plan to launch a podcast during the next 12 months, and 35 per cent are already podcasting. But is this just fad-following, or are there solid business reasons for publishers to get into the medium?

The Telegraph runs a daily news podcast featuring comment and analysis of the day's stories, which is available for download from midnight every day. It contains some recorded news from the paper itself plus extra content such as interviews with Telegraph columnists or foreign correspondents.

The paper also podcasts one-off shows around special events such as the Budget. After the TV presenter Ben Fogle and the Olympic gold medallist James Cracknell rowed across the Atlantic, The Telegraph published a story in the paper and made a podcast of extended interviews.

"We decided that we have to deliver Telegraph journalism to people in the ways that they want to consume it," Ruddle says. "There's also the fact that most news stories have different elements that are best communicated in different ways. With Fogle and Cracknell, the best way for people to understand how they were feeling after the race was to hear it in their own words rather than read it in print."

The Guardian's recent podcast launches, meanwhile, cover news, media, politics and science. The news podcast is published at midday UK time, so it is available to the paper's increasingly important US audience first thing in the morning.

"Being online generally means that people who don't have access to the paper can still see what The Guardian is all about," Neil McIntosh, the assistant editor of Guardian Unlimited, says. "The iPod audience is also mostly made up of young people, many of whom don't read newspapers, so podcasts can also be a way of introducing people to the paper itself."

Ruddle agrees that the value of podcasting for newspapers lies in its ability to target different audiences. "It may mean that we keep people reading The Telegraph or even that it sends people back to the paper," he says.

Podcasting for broadcasters

Virgin Radio now gets 110,000 downloads a month across its five podcasts.

Most are highlights shows and some are even created automatically, making them relatively cheap to produce.

The station has also recently launched a Best of the Guests podcast, its first foray into content created specifically for podcast. The show includes interviews from shows broadcast that week plus archive material, much of which has never been heard before. It has also just introduced software that means its podcasts can be downloaded directly to Nokia phones as well as MP3 players.

As well as reaching new audiences, delivering radio "on demand" is another obvious benefit for radio broadcasters. Sarah Prag, the senior project manager in charge of podcasting at BBC Radio and Music Interactive, says the BBC has explored podcasting as a way to distribute content via a method that is in keeping with people's changing media habits.

One of the pioneers in UK podcasting, the BBC launched its first foray into the medium in May 2005, with a 20-programme trial. It has since expanded that number to 50, all from existing BBC shows.

"For the past five years, we have had the BBC Radio Player, which lets people listen to any show from the past seven days - but it's streamed content, so they have to be at their computer," Prag says. "Podcasting means you can liberate that content so people can take it with them and have what they want, where and when they want it."

Many of the BBC's podcasts are highlights packages - broadcasters are not allowed to podcast commercial music, because producers are concerned about listeners clipping music tracks out of downloaded shows.

Of its 1.8 million downloads per month, the most popular is The Best of Moyles weekly highlights show. But more surprisingly, the In Our Time podcast from Radio 4 comes in high up the list.

"It's a 45-minute, highbrow show that you wouldn't necessarily expect to appeal to an iPod audience," Prag says. "Some of our documentary podcasts from the World Service are also popular, which challenges the assumptions about MP3 usage."

Since Virgin's first podcast launched in March 2005, Cridland says the station has gained a clearer idea of its audience profile via listener feedback. "What's interesting is that, contrary to what you might expect, not that many of the people we hear from are London commuters," he says. "Last week, we had a bus driver from Cheshire who listens to the podcasts while driving his bus."

Podcasting for brands

Considering that its effectiveness and reach remain unproven, advertisers have been relatively quick to embrace the possibilities of podcasting - attracted, perhaps, by the "cool factor" such a new medium offers.

Many brands are now choosing to make their ads available as videocasts, some with a surprising degree of success. The Nike "joga bonito" film that was shot in Brazil about the Brazilian approach to football, for example, is currently at number four on the iTunes podcast chart (see box).

Neil Christie, the managing director of Wieden & Kennedy, which created the ad, says the decision to podcast it reflects a change in attitude at the agency. "Our view is we have to stop interrupting the stuff that people want to watch and start to become the stuff that people want to watch," he says.

One of the attractions for brands is how inexpensive the medium is: there are no media costs and creative costs only relate to extra content produced.

"The fact that it is going out to people who have actively chosen to sit and watch it is impossible to quantify in media terms," Christie adds.

Some brands are choosing to go further and create content especially for podcast. Cadbury Trebor Bassett has just signed the X Factor presenter Kate Thornton to front a podcast talent contest for its Creme Egg brand.

People will be asked to submit MP3 files of their performances and the best of them will be broadcast in a series of podcasts. The Italian lager brand Peroni has just launched its own football podcasts, featuring Nancy Dell'Olio.

Channel 4 used podcasting in the run-up to the launch of its Road to Guantanamo drama. The digital agency Holler used a podcast of an extended trailer from the show along with a web-raiding initiative that saw it seed messages about the show on 50 sites, which all linked to channel4.com/guantanamo.

According to James Kirkham, a director at Holler, click-through rates to the site and podcast ran at 15 per cent, compared with an industry average of 1 per cent. "The podcast was downloaded more than 15,000 times in two weeks by an audience that is often difficult to target with online advertising," he says. "One advantage for brands is the ability to get a message out quickly: not only are podcasts quick to make, they get a fast response. Almost half of all downloads tend to happen within the first two days of release."

THE iTUNES PODCAST TOP 20 1. The Ricky Gervais Podcast (free) 2. The Best of Moyles (BBC Radio 1) 3. The Ricky Gervais Show Promocast (paid-for) 4. Nike football videocast - "joga bonito" ad 5. Scott Mills Daily (BBC Radio 1) 6. Jack Black's Nacho Libre Confessional 7. Pete Tong's Fast Trax 8. Start the Week (BBC Radio 4) 9. Kerrang! Video Podcast (Kerrang!) 10. Happy Tree Friends (Mondo Media) 11. BBC Radio NewsPod (BBC) 12. Broadcasting House (BBC Radio 4) 13. The Xfm Sessions (Xfm) 14. Radio 1's Best of Unsigned (BBC Radio 1) 15. Sex Survey: Dr Cockney (www.doctorcockney.com) 16. Al Murray: Pub Landlord (Virgin Radio) 17. Harry Potter and the Goblet of Fire (Warner Home Video) 18. In Our Time (BBC Radio 4) 19. Drum and Bass Arena Podcast (breakbeat.co.uk) 20. Strong Bad Emails & More! (Homestarrunner.com)