Sprint acquires 33pc of Tidal
The music streaming platform, famously owned by Jay Z and an array of other artist-owners including Daft Punk and Kanye West, has had a rocky trajectory in its attempts to expand, all of which has been thoroughly covered by the media since the initial press conference announcing its artist-owner model was lambasted for being self-aggrandizing. Tidal will be hoping that it will finally be able to scale its business more successfully under Sprint?s aegis, which is of paramount importance for a company floundering in an increasingly lucrative streaming space.
"In recent years, we've seen a ? pun intended ? stream of music options,? said Jeff Hasen, author of The Art of Mobile Persuasion. ?Tidal hasn't broken out despite Jay Z's name.
?This is a fiercely fought category, one that involves data usage concerns and a lack of differentiated content. Like everything on mobile, it will win or not based on Tidal's ability to personalize and to bring exclusives and other value not presented by others."
The streaming service, which launched by Norwegian/Swedish company Aspiro after Jay Z acquired it, was launched in 2015. It?s beginnings were heralded through a ?blue-out? of its artist-owners? popular social media accounts, a move which generated significant media buzz for the company before the official announcement of its inception.
Unfortunately, Tidal has not been able to maintain this buzz, its brand instead devolving into a punchline for its struggles against booming competitors Spotify and Apple Music. The latter?s surge in subscribers in a relatively short period of time only served to exacerbate the perceived failure of the Tidal model, which touts lossless, high quality audio and exclusive content to set it apart from the pack.
Compared to Tidal?s purported 1 million paying subscribers, Apple Music has managed to amass upwards of 20 million, and Spotify over 40 million.
The partnership between Tidal and Sprint will provide the streaming service an organic avenue to expand its user base outside of traditional marketing efforts, where the brand tends to run into stigma generated on social media. Sprint?s patronage will allow for a sort of ancillary incentivization outside of what Tidal?s unique suite of features could offer, and Sprint will likely look to recoup its investment through its own marketing and other exclusive features.
At the time of writing, it is not specific as to what features Sprint customers will be treated to as a result of this partnership, with a joint press release concerning the partnership merely advertising ?exclusive content that will only be available to current and new Sprint customers.? The strategy is in line with Tidal?s ethos, which, while promoting democratization of artist revenue, tends to hew towards exclusivity with its content model ? an approach that some critics have suggested could encourage piracy.
Sprint CEO, Marcelo Claure, will also join Tidal?s board. The alliance between the two companies marks the first time that a telecom company has invested so heavily in a streaming service, and it will be interesting to see how such an ostensibly independent company owned by artists will respond to becoming beholden to the whims of a large corporation.
In any case, the two parties will look to come to a solution, and fast; Aspiro lost $28 million dollars for Jay-Z and company in 2015, and continued funding was becoming increasingly unlikely after acquisition talks with the likes of Samsung, Napster and Apple all fell through.
Shares of Sprint rose to $9.18 Monday morning.
?Jay saw not only a business need, but a cultural one, and put his heart and grit into building Tidal into a world-class music streaming platform that is unrivaled in quality and content,? Mr. Claure said. ?The passion and dedication that these artist-owners bring to fans will enable Sprint to offer new and existing customers access to exclusive content and entertainment experiences in a way no other service can.?