Samsung, which has partnered with Jay Z’s on past music ventures, has restarted talks to acquire the rapper’s 16-month-old music streaming service, several sources told The New York Post.
Samsung has reportedly been holding on-and-off talks with Tidal for a while.
The phone giant spent $28 million to sponsor the latest album and tour of Rihanna, who is a partner in Tidal and is signed to Jay Z’s Roc Nation label.
“Samsung is re-engaging; they are working on something really big, and they’re keeping it very quiet in case it leaks,” said a source close to talks.
Google and Spotify have also been eyeing Tidal, sources said. Despite Tidal’s struggles to gain traction, both companies believe it could give a boost to their own digital music services. Talks the companies are having with Tidal now appear to be aimed at smaller partnerships, sources said.
Spotify has discussed creating an initiative that could produce a Tidal “powered by Spotify” partnership rather than an acquisition, according to The Post.
So far, Tidal has managed to attract roughly one million subscribers, but the road has been rather rocky. Jay Z purchased Tidal’s predecessor, Aspiro, for $56 million early last year. Tidal executives, around the time of the launch, believed it was worth as much as $250 million. It is now valued at about $100 million, according to sources in the streaming space.
The firm in December hired its third boss, naming former SoundCloud executive Jeff Toig as chief executive.
Also, Tidal accidentally released Rihanna’s album “Anti” early while Kanye West’s latest album, “The Life of Pablo,” suffered from significant piracy issues after it was released widely even to nonsubscribers of Tidal. The piracy cost West at least $10 million in lost sales in the first days of its release, The Post reported.
The dysfunction, though common to many tech startups, has been eating into Tidal’s financing, according to The Post. “The pressure is definitely on,” said one source who confirmed that Tidal is having trouble paying some of its royalty bills on time.
In addition, Jay Z has used his own money to help boost the music streamer, another source noted.
“Tidal certainly needs a new home to stay alive,” said a music industry insider.
Tidal was unveiled in October 2014 with a unique selling point: high fidelity music and an artist-owned collective. Its owners include Madonna, Nicki Minaj, Rihanna and Alicia Keys.
Back then, phone company Sprint was expected to sign on as an equity backer. That never happened, in part because of concerns that Tidal didn’t own much beyond a technology service, according to The Post.
Potential backers were concerned that artists would be constrained from promoting Tidal exclusive releases by their own label deals, sources said.
Both Samsung and Tidal declined comment.
(Photo Source: AP)