Sprint Just Bought a Stake in Tidal

Tidal, the struggling streaming-music service controlled by Jay Z, has sold a one-third stake in its company to Sprint, the companies announced on Monday.

As part of the deal, Jay Z and the group of artist owners who helped introduce Tidal, including Beyoncé, Madonna, Kanye West and Alicia Keys, will continue to run the service, and Marcelo Claure, the chief executive of Sprint, will join Tidal’s board, the companies said. Financial terms were not disclosed.

“Sprint shares our view of revolutionizing the creative industry to allow artists to connect directly with their fans and reach their fullest, shared potential,” Jay Z said in a statement. “Marcelo understood our goal right away, and together we are excited to bring Sprint’s 45 million customers an unmatched entertainment experience.”

Jay Z bought Tidal two years ago for $56 million with a plan to lure customers with exclusive content by a group of star performers, and Tidal drew wide attention by offering early access to albums by Rihanna, Beyoncé and Mr. West. Exclusive content has become a major battleground in the music industry, with Apple also signing special deals with artists like Drake and Frank Ocean.

The deal may be an important lifeline for Tidal, which has remained an underdog in a field dominated by streaming giants like Apple Music, Spotify and Pandora. Aspiro, the holding company for Tidal, lost $28 million in 2015, according to legal filings last year. The company’s accounts for 2016 have not yet been released.

And while Tidal has claimed more than three million subscribers, those numbers have consistently been doubted by music industry executives and industry analysts. Midia Research, a market research company, estimated this month that Tidal had only one million paying users, and a report in a Norwegian newspaper last week accused Tidal of inflating its subscriber count. Tidal has not responded to that report.

Tidal’s new partnership will give Sprint customers who subscribe to the streaming service additional content that is only available to them, the companies announced, saying that further details of the arrangement would be revealed later. Sprint, which has 45 million customers, is controlled by SoftBank of Japan.

Source: New York Times


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