Is Tidal worth Jack?
Christmas came in March for Tidal, the increasingly irrelevant, money-losing music streaming service, and Jay-Z misadventure. Square, the digital finance company co-founded and led by Jack Dorsey, will pay nearly $300 million and acquire a majority stake in the company. But why, would Square do this?
It’s a bit of a head-scratcher. One could argue that it makes perfect sense — or that it is utter nonsense.
In a string of tweets and a corporate press release, Dorsey points out that this acquisition “extends Square’s purpose of economic empowerment to a new vertical: musicians.” The official argument is that musicians, as entrepreneurs that are essentially operating small businesses, need a newer (and digital) way to monetize their work and audiences.
“It comes down to a simple idea: finding new ways for artists to support their work. New ideas are found at intersections, and we believe there’s a compelling one between music and the economy.”
Dorsey is right — the artist and creator ecosystem is broken. Musicians are looking for better ways to make money. These include everything from actually being paid for their music, to live performances, and merchandise (or “merch,” as the kids call it). Square hopes that it can use its Cash app as a platform for payments for artists.
All the streaming companies know that there is an opportunity to help musicians, though they tend not to be as focused on that as some might like. Spotify sees (Read more...)