Sprint Buys a Piece of Tidal

Published On January 24, 2017 | By Tom Huskerson | News and Analysis

Cellphone carrier Sprint just dropped $200 million on JayZ for a nice chunk of his Tidal music streaming service.

JayZ purchased Tidal in 2015 for the purpose of getting artist a greater share of the music royalties. He was effective in getting numerous artists to join the service including his wife Beyonce. But his investment seemed to turn sour from day one as Tidal encountered one crisis after another. The service has been mired in lawsuits from various artists including the Prince estate. Tidal has also been accused of falsifying the number of  subscribers. Several executives have been fired or resigned. And to top it all off the service has yet to turn a profit.

It appears that after two years of negotiations Sprint has made a substantial investment in Tidal. For their $200 million Sprint takes a 33 percent stake in the company. That cash will help shore up Tidal which has had problems paying music labels. For almost a year Tidal has been looking for a partner and briefly flirted with both Apple and Samsung before Sprint returned to the table.

For Sprint the deal could be used as an incentive to grow its subcribers by offering access to early tickets sales or private shows from some of Tidal’s artist/owners. This type of incentive has worked with other cell carriers. This not new territory for Sprint which partnered with Spotify for bundle offerings within its “Framily plans” in 2014.

According to Billboard.com the additional cash will allow Tidal to create of a $75 million marketing fund for Tidal artist exclusives and initiatives. This initiative could mean more exclusive releases coming to Tidal in 2017 along with more concerts and music videos. Billboard.com estimates Tidal’s market value to be nearly $600 million.

Officially Sprint and Tidal have not released any details as to how the two would mutually benefit but Sprint says more information will be “available soon.”

Breaking It Down

JayZ is fighter. Tidal has not been the jewel he thought it was when he purchased it but it is a jewel just the same. With all the problems and the money issues the streaming service has JayZ understands that music will always be in demand. He just has to figure how to tap into that demand. His fight is to find Tidal’s niche. Let me tell you this, if Apple and Samsung both were considering buying the company then it becomes obvious that it has value. This value includes a nice list of artists that both own a piece of Tidal as well as provide content.  So what is the niche? Well that answer is yet to come but one thing is for sure; $200 million will certain help find it. Sprint understands that to survive in the cellphone industry it must expand its offerings. Keep in mind that cellphone carriers are in a life and death struggle to survive against the constant rise of smaller carriers serving market niches with better prices and no contracts.  Offering the latest cellphones just doesn’t cut it anymore. Content is king. Tidal has content.

 

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About The Author

Tom Huskerson Bio Born in Richmond Virginia Tom Huskerson is a military veteran who settled in California after his discharge. He attended Santa Barbara City College where he began his writing career as a campus reporter. He worked as an intern news reporter for the Santa Barbara News-Press writing feature stories before moving on to San Francisco. At San Francisco State University Tom studied broadcast communications and began to focus on the Internet. He completed his graduate thesis on Internet advertising. Tom was the first student to ever focus on the Internet as a graduate student at San Francisco State University. After graduation he went to work for Zona Research in California’s Silicone Valley. As a research associate Tom supported senior analyst writing on the latest developments in the Internet industry. During the dot com boom Tom worked for several web businesses as a market researcher and analyst. As a writer and researcher Tom has authored various technical works including a training program for Charles Schwab security. Other projects included professional presentations on workplace violence and hiring security contractors. Tom has returned to focus on writing both fiction and non-fiction works and blogging for a travel website. He has published two books of short stories and completed two novels. Tom is the owner of Scribe of Life Literature and EbonyCandle. Most recently Tom has launched the blog African American Cyber Report. The blog is the result of his desire to inform the African American community of the dangers and benefits of the cyber age. In his blog Tom reports on information security, new and analysis, scams and hoaxes, legal happenings and various topics that arise from the age of information. Tom believes that technology is a necessary tool for black people and they should know what is happening. Tom writes believing that techno speak is for the professional and that valuable information can be communicated using plain language. As a result he has embraced the motto, Less Tech, More Knowledge.

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