Tidal: Is It Washed Up Already?

Some of the artists who threw their weight behind Tidal at its relaunch. 

Music streaming services gained a new high-profile competitor yesterday, as Jay-Z relaunched the Tidal music service he purchased for an eye-watering $56m earlier this year.

Eye-watering? Well, yes. The service has a reputed 27,000 subscribers who, if they are all paying for the top-tier high quality service (which they probably aren't) generate a maximum $0.5m a month in revenue. Of that presumably Tidal pays a similar royalty rate to other streaming services, which would suggest that 70% of that revenue exits the door in the direction of the music publishers. Leaving $150k per month to pay for all of the costs related to running the service before any thought of a profit can be considered.

If the only competition out there was from Spotify then perhaps Tidal would have a chance, with its relaunch message being about artist ownership and a bigger cut being paid to the artist. But Apple is almost certainly going to go big with its Beats streaming service any time now - and Tidal doesn't seem to have a space to slip into between Spotify's combination of freemium/subscriber and Apple's customer loyalty.

Worse still, Jay-Z seems to have lined up a selection of good buddies who will share the profits (if they arrive) and withhold content from other streaming services to boost Tidal's penetration. That doesn't sound like the sort of tactic that is going to garner Tidal new users nor be received very well by those artist's fans.

With a poetic sense of timing, Tidal launched on the same day Sony officially canned its Music Unlimited offering and switched users to Spotify. If that doesn't hold portents for Tidal's future I don't know what does.


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