By Ryan Velez
The Wall Street Journal reports that Apple may be soon be acquiring Jay-Z’s Tidal streaming music service, and that talks have already begun. According to WSJ’s sources, the reason why Apple is drawn to bringing on Tidal to enhance its own Apple Music service is due to its ties to top artists like Kanye West and Madonna. With this said, there is no guarantee that these talks will go through, and a Tidal spokesman said these talks have not taken place.
Tidal was originally purchased by Jay-Z from Swedish company Aspiro in March 2015 for $56 million. He gave 19 famous artists and bands small stakes, and promised them millions of dollars worth in marketing. Many of its 4.2 million paying subscribers have joined due to the string of exclusive releases on the service. Tidal is also notable as the only service offering songs from recently deceased megastar Prince, who was famously leery of streaming services but had a tight relationship with Jay-Z.
This doesn’t mark the only talks that Tidal may have had, with the Wall Street Journal saying that it has met with other partners since last year, including streaming service Rhapsody (now changed to Napster).
Tidal’s advantage in the market to date is due to this artist-friendly reputation it has developed, due to artist ownership and only offering paid subscriptions, which generate more income for the industry. By comparison, subscription streaming leader Spotify has actually upset some artists by refusing to let them limit their music to the paid tier.
One interesting thing to note is that Apple already has its hand in the streaming music service ring with Apple Music, originally based on the Beats streaming service, which was acquired with headphone maker Beats Electronics for $3 billion in May 2014. While this has garnered them names like Dr.Dre and music mogul Jimmy Iovine to help draw people to the service, Apple noted in June that they would redesign Apple Music in the fall to address complaints that the software is confusing and difficult to navigate. They also mentioned having 15 million paid subscribers.
A potential merger between the two would potentially help Apple with its attempts to gain closer relationships with recording artists, including provide marketing assistance and helping to pay for music videos for high-profile artists in exchange to exclusivity to their platform for a certain period of time.