Apple Music Rival Tidal Reportedly Facing Money Problems Amid 'Stalled' User Growth

Streaming music service Tidal is facing money problems and could run out of working capital within the next six months, according to a report this week by Norwegian newspaper Dagens Næringsliv (via The Verge). The report stated that the money issues likely stem from Tidal's user growth, which is said to have "stalled" recently.

Sprint bought a 33 percent stake in Tidal this past January, and at the time Jay Z’s business partner and Roc Nation Sports president Juan Perez mentioned that the carrier's investment gave Tidal "sufficient working capital for the next 12-18 months." The Jay Z owned service is said to have lost around NOK$368 million (around $44 million) before taxes in 2016, and Tidal reportedly claims that it will break even and achieve profitability in mid-2018.

Regarding the new claim of Tidal's money and subscriber problems, a company spokesperson told The Verge the following: "We have experienced negative stories about Tidal since its inception and we have done nothing but grow the business each year."

It isn't clear exactly how many people are subscribed to Tidal since the service has refrained from releasing such a count following the Sprint deal. At that time, Dagens Næringsliv again reported on Tidal, this time focusing on a claim that it was inflating subscriber numbers as far back as when Jay Z acquired it in 2015. The newspaper said it obtained internal reports from Tidal that showed it had 350,000 subscribers in September 2015, at which time Jay Z said it had gained 1 million subscribers.

Subsequent inflation numbers surfaced in March 2016, and afterwards the company hasn't provided any data regarding the amount of its subscriber base. As a point of comparison, Spotify remains in the lead for music streaming services with over 60 million paid subscribers as of July, while Apple Music follows with over 30 million as of September.

Tag: Tidal

Top Rated Comments

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syklee26

15 months ago

Just one of 99 problems JZ has... no big deal

Rating: 15 Votes

asdavis10

15 months ago

I think many people signed up for the Tidal trial at certain exclusive launch periods, but few stayed on for the subscription. It's an expensive service for casual music listeners who don't care about hi-fidelity music. I don't even think it makes sense for an Apple acquisition. Just let the service shutter and get some of their subscribers for free.

Rating: 10 Votes

TMRJIJ

15 months ago

‘Rival’ is a strong word....

Rating: 8 Votes

HenryFSU

15 months ago

Tidal is expensive, but if you appreciate lossless music, they are pretty much the best at this game. If Apple ever got into the lossless music streaming business, then Tidal would fold for sure.

Rating: 8 Votes

simonmet

15 months ago

This is disappointing to hear but it sounds like they’re not in immediate danger of collapse. I’ve been a Hi-Fi subscriber for most of the past year and though it has some bugs and quirks the app is still way nicer to use than Apple’s Music.

I agree that if Apple went lossless they’d effectively kill Tidal. It seems like a no-brainer for them to do so so I can’t understand why they haven’t. It’s often been suggested that Apple even buy Tidal, not that I can see this happening.

An added bonus if Apple went lossless is my carrier lets me stream Apple Music for free so I’d love the opportunity to stream Apple’s entire catalogue in lossless without draining my cellular data cap.

Rating: 7 Votes

Kaibelf

15 months ago

I think Tidal's message was off from the beginning. If they focused on it being an exclusive club that gets early access to top artists, fine. However, they had their coming out party with a stage full of people like Jay-Z, Kanye, Deadmaus, and others who are incredibly wealthy and successful talking about how it would make sure they got paid.

In the end, for a new artist the number of users who may hear them is what ultimately matters, so it made NO sense to hitch their wagon to a limited service where the main draw was streaming rights for artists that were so successful that they would dominate all content delivery.
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I think many people signed up for the Tidal trial at certain exclusive launch periods, but few stayed on for the subscription. It's an expensive service for casual music listeners who don't care about hi-fidelity music. I don't even think it makes sense for an Apple acquisition. Just let the service shutter and get some of their subscribers for free.

Did you clear this sentence with Kanye? :eek:

Rating: 5 Votes

lunarworks

15 months ago

Tidal's only defining feature is the high quality streaming, but honestly, it makes no difference with my setup. A good 98% of potential customers probably feel the same.

Rating: 4 Votes

BODYBUILDERPAUL

15 months ago

I think in general a lot of people have “subscription fatigue” and are tired of paying monthly for some services which they are increasingly questioning the value of (to them). I see Spotify eventually being purchased by another company that will use the service more as a “lure” to get customers through the door to use the main component/entity (hardware/software/more significant services) of their business that keeps the lights on and more.

I totally agree. £20 here in the UK a month to rent music. It's crazy, people's incomes in the UK are at a all time low. Apple puts its prices up 20%. Mobile phone contracts, broadband, Netflix etc is a large amount of money on top of the usual rent, car leasing, food, gym, travel, education etc. The problem is, these rental markets are just too saturated and easily forgotten. Here in the UK, EE mobile is constantly trying to give me Apple Music for free for 6 months but i'm not prepared to try it whilst it's integrated into iTunes. I value my iTunes library - its taken me years to build and when i read on MacRumors of people losing tracks etc etc because of AM, it was a no way. I guess if AM had a separate app well away from my music and playlists then... maybe. But then, i'd rather pay £10 a month for iTunes downloads.

Rating: 4 Votes

sonamo

15 months ago

A few years back, before I heard about Tidal, I was still buying CDs for high-quality digital tracks. I'm a believer that the sound quality of digital music shouldn't get worse as we have made the transition away from CDs.

The catalog of Tidal is on par with all the other services. While there are other services like Deezer that offer lossless tracks, that subscription is really just for Sonos users, and Deezer doesn't have a desktop app and iPhone app for lossless. So Tidal really is one of a kind to me.

I hope that Tidal can do alright and stick around because it's my favorite service by far

Rating: 4 Votes