Jay Z once bragged that he could sell fire in hell. Well, the music industry has been hell for a while now, and Jigga’s inner salesman is gearing up.
Jay took the stage with a powerhouse stable of artists—Madonna, Jack White, Kanye West, Rihanna, Beyoncé, Alicia Keys, Daft Punk, Coldplay’s Chris Martin—Monday afternoon to announce the re-launch of the music streaming service Tidal. It’s an ambitious endeavor. All of the artists on stage are referred to as “co-owners” of the venture, and they promised—in the words of Keys, who led the remarks during the announcement—”a whole new era” for the music industry.
But a new era for who? On the surface, Tidal offers fans high-fidelity audio and video as well as curated content. But the service—the result of Jay Z’s purchase of streaming music service Aspiro for $56 million earlier this year—is also intended to give artists more control over their content. And that’s great and all, but if artists are forming their own walled garden and charging fans $20 every month for lossless audio ($10 for not-so-high-fidelity tracks), is this service for us, or them?
By offering windows of exclusive access to some artists, Tidal is clearly taking aim at streaming services like Spotify. And it’s true that artists don’t get the best returns when it comes to streaming, as Taylor Swift’s flight from Spotify showed last year. To that end, Jay Z is reportedly offering lots of cash and an equity stake to those who join him, and other artists are being promised double the standard streaming royalties for their music. But if a group of the most popular artists in the world start what is essentially their own label, and then pull their music off of other services, will that service be any better than the music industry it’s trying to unsettle? If it leaves fans with only one place to stream the new record by Rihanna or Kanye West—both of whom coincidentally are supposed to have new albums in the offing—then the answer is “no.”
Fans use streaming as a way to check things out before they buy, or to hear things they wouldn’t pay for otherwise. Trying to turn the new Beyoncé or Kanye West record into the House of Cards of your boutique audio service backfires for that very reason. HoC is/was a new show, one that came as a surprise to Netflix users; but any new project from one of these megastar arists has a built-in fanbase, and those fans are going to get their hands on it no matter what. They’ll either buy the album, which they would probably do anyway, or find another way to hear it: YouTube, BitTorrent, or one of the seemingly endless direct-download services that pop up Whack-A-Mole style to accommodate the resourceful.
Still, the chances of Tidal’s artists taking all of their toys out of the sandbox for good is probably small. It’s still unclear if the “co-owners” of Tidal, or any of the artists who join them, will stream 100% exclusively on the service. And it may never happen. James McQuivey, a music analyst at Forrester Research, notes that while there’s room for an upstart service to elbow its way in to streaming music business with that kind of premium offering, just as Netflix and Amazon have done with TV and movies, artists simply may not be willing to take that kind of risk. (Then again, Swift’s catalog—minus her current hit record 1989—has been streaming on Tidal since last week.)
“Very few artists will follow Taylor Swift’s lead and put all their money on Tidal’s bet, because it doesn’t make rational sense to forgo revenue from other providers while you wait to see if consumers sign up in enough numbers to make you money,” says McQuivey. “Remember, even Sony sells TVs at a discount at Costco because that’s where the people are. Hard to turn your back on customers. And really, do you want to put all your eggs in one basket forever?”
And frankly, for the music industry to grow, it needs as many baskets as possible. A couple of weeks ago, when Kendrick Lamar released his very-anticipated new record To Pimp a Butterfly, the album received 9.6 million plays on Spotify on its first day. A rough estimate turned up that those single-day streams earned between $921,600 and $1,290,240. And those figures are on top of what he made for the 324,000 albums he sold in his first week. Could he have made more with a fancy Tidal deal? Maybe. But considering at least some of those 9.6 million streams came from folks using Spotify’s ad-supported service—a model that Tidal doesn’t offer—it’s next to impossible that he would he have reached as many ears.
Streaming is still music’s best bet for growth; the problem is, the landscape fragmenting into a half-dozen services that each offer its own hodge-podge of artists will only lead to burn-out. People will pick one service—probably the one they’re already using—and just give the finger to the rest. They’ll find what they can on YouTube, buy a few tracks if they can, and that’ll be that. The chances that they’ll sign up for another service just for a few albums is slim.
Then again, this is Jay Z we’re talking about; he may not be able to get you to buy a Samsung Galaxy, but he still sells out stadiums. If anyone can launch a new music service, it’s him and his famous partners. But for now, we wait (and listen). Either people will catch the Tidal wave and buy what he’s selling, or they’ll just burn it down.
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