Jay-Z‘s agreement to sell his shares in the music-streaming service, TIDAL, to Jack Dorsey’s financial services business Square, is final.
Valued at $435 million, according to a popular news outlet, Square paid $350 million for 80 percent of Tidal in the transaction, which formally closed on Friday. Square executive Jesse Dorogusker (who chose not to comment on the situation) will act as temporary head of the musical platform while Square looks for a permanent leader.
According to reports, Square will still secure distribution agreements with the major record labels, and Desiree Perez, the CEO of Jay-entertainment Z’s empire Roc Nation, will continue to assist in the operation of Tidal. The contract allows Jay-Z to leave the company he helped launched in 2014, which has suffered in the face of larger streaming competitor’ Spotify and Apple Music. Small subscription figures — estimated to be between 1 and 5 million (a pittance relative to Spotify’s 356 million monthly active users) and heavy employee churn have weighed heavy on the service.
The recent acquisition poses concerns on whether Square, a financial services firm, should purchase a music streaming startup. In a series of March tweets, Dorsey justified the contract, stating that he intends to support Tidal artists as they expand their companies and fanbases by developing collaborative platforms, making it simpler to sell products, and providing “entirely new listening experiences.” In addition, he added “Given what Square has accomplished for businesses of all sizes and individuals through Cash App, we believe we can now work with artists to achieve the same level of success”.
The above notwithstanding, one concern still remains: how would tech billionaire Jack Dorsey fit into this image if TIDAL was introduced to the world as the “only” streaming site operated by artists for artists?