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99 Problems And Time For Investment? Sprint Acquires 33% Of Jay Z's Tidal

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99 Problems And Time For Investment? Sprint Acquires 33% Of Jay Z's Tidal

Just days after Tidal hit a fresh wave of criticism, Sprint Corp (NYSE: S) bought 33 percent of the music streaming platform and extended the service to 45 million customers.

The announcement came Monday after a Norwegian newspaper accused Tidal owner Jay Z of inflating subscription figures on two separate occasions.

Tidal Struggles To Stay Afloat

According to the report released Friday, a September 2015 tweet boasted of 1 million Tidal subscribers when internal reports counted only 830,000. A more recent error was pushed through a March press release, when owners announced 3 million paying subscribers. Internal reports tracked 1.2 million, while payments to record labels noted 850,000.

The allegations are consistent with recent reports of the project’s financial struggles. In September 2016, the Wall Street Journal reported that Tidal had been draining funds of Swedish holding company Aspiro AB. The project lost $28 million in 2015, and owners owed about 100 labels a total of $438,000.

But Not Everyone Is Sinking

Since its inception, Tidal has struggled to gain ground in the music streaming industry, which has altogether done well in recent times.

A January 6 report by Midia Research noted that global streaming subscribers surpassed 100 million in December — an increase of 48 percent from the previous year.

Spotify dominates the market with 43 million subscribers, or 43 percent of total users worldwide. Apple Inc. (NASDAQ: AAPL) claims 21 million and Deezer 7 million. Together, Apple and Spotify maintain a combined 64 percent of streaming subscribers.

Meanwhile, reports suggest that Tidal controls less than 1 percent of the market.

Perhaps the Sprint partnership is an attempt to change the current.

Sprint CEO Marcelo Claure will join the board of directors, while Tidal’s artist-owners will continue to run the service.

Image Credit: By Mike Barry from Wirral, England - IMG_0653, CC BY 2.0, via Wikimedia Commons

Posted-In: Aspiro ABNews Contracts Asset Sales Tech Media Trading Ideas General Best of Benzinga

 

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