Published March 1st 2016
Last week, rumors emerged about Samsung having plans to make a major move into the music business. Pretty much immediately, it got linked to Tidal. Samsung, reportedly, is looking into buying the streaming service.
It’s rumored Jay Z thinks it’s time to sell Tidal.
Isn’t Tidal A “By Artists For Artists” Company?
At first, you may wonder whether that would not ruin the whole point of Tidal’s new setup.
Once Jay Z acquired it – with the help of many other musicians and even rapper TI signing on as the latest co-owner last month – it was supposed to be an artists for artists kind of business. Therefore, making it easier for artists to make more money on streaming than other streaming services were paying out. Meanwhile, offering better quality sound and more exclusive content to its paid subscribers.
Since Jay Z’s Takeover
However, Tidal has been troubled since. Many executives have left or been replaced since Jay Z’s takeover. It has come to light, with thanks to some Scandinavian press, that Tidal lost its COO and CFO just last week. It just continues to be restless within the company and appears to be unclear of a vision.
Lack Of Success?
Even though it was disputed by Tidal at first, it has proven difficult for their recent releases to make it into important charts. This has nothing to do with lack of success.
Exclusive releases like Rihanna’s “ANTI”, Kanye West’s “Life of Pablo” and even Beyonce’s single “Formation”, have all contributed to a doubling in subscribers. Currently, Tidal has 2.5 million subscribers.
But the problem is, that their data clearly is not shared with Nielsen, which means their generated streams and downloads are not counted as such for any Billboard chart position or even being recognized as certifications by them, while the RIAA do receive their data. It’s considered to be the reason for CFO, Chris Hart, to have been removed from his position.
Costly Blunders
Both major releases, Kanye West’s and Rihanna’s, also faces technical issues. Rihanna’s album was leaked and forced to an early release and Kayne West’s album was briefly also available to non-subscribers. It was expected the company lost $10 million on revenue due to this, causing the company even more financial stress.
Even though subscribers doubled, the net worth of the company, has been reported to have been decreased with 50% since the moment of Jay Z takeover. Now, the company is being valued at $100 million.
Unpaid Royalties?
Then, also this week, the company got hit with a $5 million lawsuit for not paying out artist royalties. In the lawsuit Tidal is also accused of offering 118 songs from one publishing company, Yesh Music Publishing, without their permission.
This is pretty damaging news to all the musicians who invested in the company thinking to be better compensated, so it didn’t take long for Tidal to respond the lawsuit and state the claims are false and Tidal is completely up to date paying out all artist’s royalties. They’ve also removed the 118 songs from their service.
Time To Make It Somebody Else’s Worry?
Even though the lawsuit sounds like it’s no real threat to Tidal, it’s clear to many a potential sale could really turn the company around. Alongside of Samsung, Google and Spotify are also mentioned to want Tidal.
