Sprint to Buy 33% of Jay Z's Tidal Music Service -- 4th Update
January 23 2017 - 1:27PM
Dow Jones News
By Austen Hufford
Sprint Corp. will buy one-third of Tidal, the streaming-music
service run by rap mogul Jay Z, the latest content deal secured by
a network provider.
The companies said Monday the deal will give Sprint customers
access to exclusive content on Tidal, though they must still sign
up and pay for the streaming service.
A Sprint spokeswoman said news about upcoming offers and
promotions will be released soon.
Tidal's current management team will keep running the service
and Sprint Chief Executive Marcelo Claure will join its board.
Terms of the deal weren't disclosed.
Jay Z bought the service in March 2015 for $56 million from
Swedish company Aspiro, which had created the Tidal brand. He has
given famous artists and bands small stakes in Tidal and promised
each millions of dollars worth of marketing, The Wall Street
Journal has reported.
Tidal has been struggling to attract subscribers to keep up with
larger rivals such as Spotify AB and Apple Inc.'s Apple Music.
Sweden's Spotify has more than 40 million paying subscribers,
while Apple Music in December boasted 20 million paying
subscribers.
Last June, Tidal said it had expanded its user base to 4.2
million paying subscribers. Still, analysts have said Tidal's user
base includes many listeners who signed up through a free trial,
and the company hasn't released metrics since the June
disclosure.
Earlier this month, industry tracker MiDia Research estimated
Tidal had 1 million "commercially active subscribers."
Tidal has amassed many of its subscribers through exclusive
releases from superstar artists such as Kanye West, Rihanna and
Beyoncé, many of whom are connected to Jay Z.
It also promotes itself as more artist-friendly and provides
high-quality, so-called lossless streaming.
Streaming music is the U.S. recorded-music industry's biggest
revenue source, according to the Recording Industry Association of
America.
Tidal parent Aspiro lost 239 million Swedish kronor ($28
million) in 2015 as it worked to expand its customer base and get
music deals.
In the financial statement, Aspiro said a board assessment had
concluded the company lacked funding for 2016 but added, "The board
believes the company will be able to secure new financing."
Tidal charges $20 a month for a high-fidelity version of its 40
million-song catalog and $10 a month for download-quality
sound.
Network service providers have been striking content deals to
attract and retain new customers. AT&T Inc. made a deal with
singer Taylor Swift to share exclusive videos with its customers.
Verizon Wireless has a deal to stream NFL games to its
customers.
Shares of Sprint rose 3.25% to $9.23 in midday trading on
Monday.
Matthias Verbergt contributed to this article
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
January 23, 2017 13:12 ET (18:12 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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