Square buys a majority stake in Tidal's streaming service
Square, the financial services firm founded by (Jack Dorsey), Twitter CEO, has acquired a majority stake in Tidal, the high-definition audio and video streaming service led by (Jay-Z) Jay-Z.
Square paid $ 297 million in cash and shares for the majority stake, and said Tidal operates independently alongside Square's other projects.
Dorsey asked a question on Twitter about the reason that brings together a music broadcasting company and a financial services company, and answered: The reason is finding new ways for artists to support their work.
“As Square has provided sellers with new tools to make money, the company's stake in Tidal is helping artists find similar support in the new digital ecosystem,” Dorsey said.
He added: Given what Square has been able to do for sellers of all sizes and individuals with the Cash app, we believe we can now work for artists to see success for them and for us.
Tidal was founded in Norway in 2014 before a consortium of artists led by Jay-Z bought it the following year for $ 56 million.
The new owners put Tidal in competition with streaming services from big tech companies, promising audiences with high-quality audio and exclusive content.
Tidal soon ran into trouble, failing to secure exclusive content in the long term or attract subscribers from competitors like Spotify.
In 2017, the company secured a $ 200 million investment from Sprint, but reports the following year said that subscriber growth has stalled.
It was said at the time that the service had nearly 3 million paying customers, compared to about 20 million Spotify customers in the same year.
The company's revenue reportedly grew by 13 percent to $ 166.9 million in 2019, but losses also increased from $ 36 million to $ 55.19 million in the same period.
Tidal now has another opportunity to reinvent itself, said (Jesse Dorogusker), interim president of Tidal Service: The company is embracing new tools for artists while continuing to provide the streaming service to consumers.
“We believe the streaming service is an important part of it, and it is growing and continuing to grow,” added Dorogusker.
As part of the deal, Jay-Z joins Square's board of directors, and Jay-Z said: The Tidal service is more than just a stream of music, and six years later it has remained a platform that supports artists at every stage of their careers.