Twitter boss Jack Dorsey buys majority stake in Jay-Z’s Tidal
Social media king Jack Dorsey has some big plans in digital music.
Square, Inc., the financial services company established by Dorsey is buying a “significant majority ownership” stake in Tidal, paying US$297 in cash and stock.
Following the transaction, Jay-Z will join Square’s board of directors and Tidal will operate independently with Square’s portfolio of assets.
Dorsey broke the news with a thread on Twitter, of course. “Why would a music streaming company and a financial services company join forces?,” he wrote. The real reason is to spot “new ways for artists to support their work,” he continued.
It comes down to a simple idea: “finding new ways for artists to support their work. New ideas are found at the intersections, and we believe there’s a compelling one between music and the economy. Making the economy work for artists is similar to what Square has done for sellers.”
Square stock is down 7% on the news.
Jay-Z (real name Shawn Carter) turned to Twitter for his own perspective on the deal. It’s a win-win for the artist community.
“I said from the beginning that TIDAL was about more than just streaming music, and six years later, it has remained a platform that supports artists at every point in their careers. Artists deserve better tools to assist them in their creative journey,” he tweeted.
Square is acquiring a majority ownership stake in TIDAL through a new joint venture, with the original artists becoming the second largest group of shareholders, and JAY-Z joining the Square board. Why would a music streaming company and a financial services company join forces?!— jack (@jack) March 4, 2021
In another message, he wrote: “Jack is one of the greatest minds of our times, and our many discussions about TIDAL’s endless possibilities have made me even more inspired about its future. This shared vision makes me even more excited to join the Square board.” And, “this partnership will be a game-changer for many. I look forward to all this new chapter has to offer!”
I said from the beginning that TIDAL was about more than just streaming music, and six years later, it has remained a platform that supports artists at every point in their careers. Artists deserve better tools to assist them in their creative journey.— Mr. Carter (@sc) March 4, 2021
Tidal has existed for seven years, though has never managed to make weight against Spotify or Apple Music in the battle for subscriptions.
The streamer was founded in Norway in 2014, prior to being acquired by a consortium led by Jay-Z the following year for US$56 million.
The company’s competitive angle was two-fold. Artists were positioned as stakeholders, and those stakeholders were committed to giving exclusives and special access to Tidal users.
The other, high-end audio quality.
After a difficult start, which saw CEOs switch out at an unfortunate rate, Tidal got down to the business of gathering subscribers and building its library.
Many observers felt Tidal would be swept away in a matter of time.
Jay-Z didn’t help matters when, while giving testimony in court back in 2015 for a copyright matter, he listed his interests but omitted Tidal.
The company’s subscription base has been reported at 3 million, a figure that Tidal never confirmed or denied.
According to a statement, Tidal’s artist owners will continue to co-own the platform, as the second largest group of shareholders.
The sum paid for Tidal is dwarfed by the market cap of Spotify, which based its closing shareprice Thursday on the New York stock exchange, is worth US$54 billion.
This article originally appeared on The Industry Observer, which is now part of The Music Network.