Last week, mobile payment platform Square, Inc. announced plans to buy a major ownership stake in streaming music service TIDAL in a $297 million cash and stock deal. TIDAL was purchased by rapper Jay-Z (Shawn Carter), wife Beyonce and other artists purchased the company in 2015 for $56 million to provide subscribers with a premium streaming music experience that includes music, content and experiences. As part of the deal, Jay-Z will join Square’s board of directors.
Announcement on Twitter
Jack Dorsey, co-founder of Square and Twitter, made the announcement on Twitter last Thursday.
Bloomberg first reported that Dorsey and Jay-Z were in talks in December, noting that they had been seen together in the Hamptons last summer and in Hawaii in December. In one of his tweets, Dorsey indicates that Jay-Z will help lead the entire company, including Seller and Cash App, once the deal closes.
Official Square announcement
“It comes down to one simple idea: finding new ways for artists to support their work,” said Dorsey in Square’s official announcement. “New ideas are found at intersections, and we believe there’s a compelling one between music and the economy. I knew TIDAL was something special as soon as I experienced it, and it will continue to be the best home for music, musicians, and culture.”
Jay-Z also commented on the deal, which better positions TIDAL to be successful.
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“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,” said Jay-Z. “Artists deserve better tools to assist them in their creative journey. Jack and I have had many discussions about TIDAL’s endless possibilities that have made me even more inspired about its future. This shared vision makes me even more excited to join the Square board. This partnership will be a game-changer for many. I look forward to all this new chapter has to offer!”
Competing with services like Apple Music, Spotify and Amazon Music Unlimited, TIDAL was named by Business Insider as the best music service for audiophiles earlier this year because of its superior audio quality. The ad-free streaming music service is available by subscription-only. The service has two tiers, TIDAL Premium for $9.99 a month TIDAL HiFi for $19.99 a month, after a 30-day free trial period. In addition to 70 million songs and 250,000 high quality videos, TIDAL offers unlimited skips, offline listening, curated playlists and exclusive videos, livestreams and events. Focused on the fan experience, TIDAL also connects artists directly to their fans, fostering direct connections and relationships. The streaming music subscription service is available in 56 countries.
Jess Dorogusker, a Square executive, will serve as interim leader of TIDAL, shared his thoughts on the new relationship.
“TIDAL sets a high standard for supporting artists, capturing music culture, and delivering the best audio quality to fans. Square has also set a high standard for building elegant, accessible, and fair tools for sellers and individuals to economically empower them. Together, TIDAL and Square will be music-obsessed and artist-focused while we explore new artist tools, listener experiences, and access to financial systems that help artists be successful,” said Dorogusker.
This is a very interesting partnership, matching up a premium streaming music service with a mobile payment platform. But then again, Jack Dorsey is not always predictable. He is an innovator, and he is not afraid to try new things or to say, “why not?” On the surface, this may seem like an odd match, but Dorsey and Jay-Z are both brilliant in their own arenas. For Dorsey, this is a way to diversify revenue streams for Square. For Jay-Z, this is an opportunity for TIDAL to soar beyond what it has been able to accomplish so far. While heralded as a high quality, streaming service, TIDAL didn’t make the list of top music services most used by young people in the U.S. between 2018 and 2020.