Sprint Purchases 33 Percent Stake in Tidal
The deal for a one-third stake in Tidal costs Sprint $200 million, according to a source.
Sprint has acquired a 33 percent stake in Jay Z‘s streaming service Tidal, the two companies announced today (Jan. 23). A source familiar with the matter tells Billboard that the purchase was for $200 million and that Jay and each of the company’s two dozen artist-owners will remain part owners.
As part of the deal, Tidal will become available to Sprint’s 45 million retail customers, while the companies will partner for exclusives from its artists, according to a press release. Sprint CEO Marcelo Claure joins Tidal’s board of directors.
“Jay saw not only a business need, but a cultural one, and put his heart and grit into building TIDAL into a world-class music streaming platform that is unrivaled in quality and content,” Claure said in a statement. “The passion and dedication that these artist-owners bring to fans will enable Sprint to offer new and existing customers access to exclusive content and entertainment experiences in a way no other service can.”
Another aspect of the partnership includes the creation of a “dedicated marketing fund,” which a source says will have an annual budget of $75 million solely for the artist initiatives and exclusives. For those who already subscribe to Tidal, estimated to be around one million people, there will be no change in the existing service.
“Sprint shares our view of revolutionizing the creative industry to allow artists to connect directly with their fans and reach their fullest, shared potential,” said Jay Z in a statement. “Marcelo understood our goal right away and together we are excited to bring Sprint’s 45 million customers an unmatched entertainment experience.”
Tidal’s and Sprint’s relationship dates back to the March 2015 U.S. launch of the company, when a report from the New York Post indicated that Sprint had acquired a stake in the company. At the time, Sprint walked back any formal deal, only alluding to negotiations “to determine how to best to make the service available to its customers… We are working together in partnership for the vision of the common cause of reestablishing the value of music, it is NOT a financial investment or exclusive partnership.”
Those discussions seem to have resulted in today’s announcement, which also comes days after Norwegian media outlet Dagens Næringsliv published a lengthy report claiming that Tidal had been inflating subscriber numbers, while rumors of an acquisition, possibly by Apple, have been growing for months. Jay Z bought Tidal from Swedish company Aspiro AB for $56 million in 2015.