Could a Tidal buyout be in the offing? Maybe, according to Bloomberg. The outlet is reporting that Square, the payments company run by Twitter co-founder and CEO Jack Dorsey, has discussed a potential acquisition with Jay-Z, the rapper and entrepreneur who bought Tidal in early 2015.
Bloomberg cites an unnamed source and has emphasized that a deal isn’t guaranteed. Still, the report is an intriguing one. Tidal is a direct competitor to Spotify, Apple Music, YouTube Music and Amazon Music Unlimited. It launched in 2014 and then relaunched under Jay-Z’s stewardship with a number of celebrity backers including Daft Punk, Jack White and Kanye West. The company has tried to stand out with high-profile exclusives, such as Rhianna’s 2016 album ANTI and The Carters’ Everything is Love. Many of these deals have petered out, though. Kanye is no longer wedded to Tidal, for instance. Even Jay-Z’s once-exclusive discography is now available on other streaming streaming services.
Tidal still has some advantages. Users can pay for a HiFi plan which unlocks streaming options — HiFi and Masters (2304-9216 Kbps) -- that are higher quality than anything offered by Apple and Spotify. (Amazon has an equivalent service called Amazon Music HD, though.) It’s not clear if the occasional exclusive and higher-quality streaming is enough, though. Tidal’s subscriber numbers are a mystery, leading many to believe that it’s trailing behind Spotify and Apple Music. Back in 2018, Norwegian newspaper Dagens Næringsliv reported that the company was faking the numbers for several of its biggest albums. That led to a probe that was approved by the Norwegian Supreme Court Appeals Committee last June.
Square, meanwhile, is performing tremendously well. The company initially gained momentum with its square-shaped card readers, which small merchants could connect to their phone or tablet through a 3.5mm headphone jack. The company has since expanded into a host of lucrative merchant services and launched a consumer-facing smartphone app, Cash App, for transferring money, buying stocks and other banking-related tasks. The application has proven popular with young adults, and Cash App has leaned into this image by sponsoring esports organization 100 Thieves. A music streaming service, therefore, might not be the strangest acquisition if Square wants to keep cultivating this younger user base.