US telco Sprint has acquired a 33% stake in Tidal, in a surprise move that comes just days after a Norwegian newspaper cast doubt on the music-streaming service’s public subscriber figures.
The deal, for an undisclosed amount, will also see Sprint promote Tidal to its 45m+ customers in the US, with Tidal providing “exclusive content that will only be available to current and new Sprint customers”. Sprint is also launching a “dedicated marketing fund specifically for artists” as part of the deal.
“Sprint shares our view of revolutionising the creative industry to allow artists to connect directly with their fans and reach their fullest, shared potential,” said Jay Z in a statement. Sprint CEO Marcelo Claure will now join Tidal’s board of directors.
The deal comes nearly two years after Sprint publicly denied that it was planning to invest in Tidal, after media speculation to that effect.
“Sprint confirms that it is in discussions with Tidal, the new music streaming platform launched earlier this week, to determine how to best to make the service available to its customers,” said the telco at the time.
“It further clarifies that it has not made an investment in Tidal. 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.”
Since then Tidal has been linked with potential acquisitions by Samsung and Apple, although both are thought to have pulled back. Sprint’s investment should secure Tidal’s short-term future, at a time when there are widespread expectations that the music-streaming market is about to consolidate – among the global players, at least.
As we reported this morning, Friday saw Norwegian newspaper Dagens Næringsliv claim that Tidal’s public figures for its number of subscribers have been inflated. While the company claimed “three million members” in 2016, by the end of the year it is thought to have had closer to one million paying subscribers.
Terms of the Sprint deal have not been announced, although one report – from MBW – claims that the telco may have invested around $200m, which would value Tidal at $600m.