What Jay-Z’s Tidal And Square Deal Could Mean For The Future Of Music – VIBE.com
If there’s one thing Shawn “Jay-Z” Carter knows about business, it’s the power of owning valuable assets before selling parts of them for a profit. In a press release received Thursday (March 4), Carter has sold a majority ownership stake of his streaming platform, TIDAL, to Square, the financial services company owned by CEO and co-founder Jack Dorsey. In the deal, the fintech entity “expects to pay a mix of cash and stock of $297 million” and allow the existing artist shareholders to remain shareholders. Jay-Z’s initial investment in Tidal was $56 million back in 2015.
“I said from the beginning that TIDAL was about more than just streaming music, and six years later, it has remained a platform that supports artists at every point in their careers,” said Carter on the announcement. “Artists deserve better tools to assist them in their creative journey. Jack and I have had many discussions about TIDAL’s endless possibilities that have made me even more inspired about its future. This shared vision makes me even more excited to join the Square board. This partnership will be a game-changer for many. I look forward to all this new chapter has to offer!”
As for Dorsey’s statement: “It comes down to one simple idea: finding new ways for artists to support their work,” said Dorsey, who is also the CEO of Twitter. “New ideas are found at intersections, and we believe there’s a compelling one between music and the economy. I knew TIDAL was something special as soon as I experienced it, and it will continue to be the best home for music, musicians, and culture.”
This new development comes months after reports surfaced about Square wanting to buy Tidal and after Carter and Dorsey were spotted chillin’ in the Hamptons. After the Tidal-Square business deal is closed and finalized, Jay-Z will join Square’s Board of Directors.
So now that the cat’s out the bag, what does this majority stake acquisition really mean? What potential opportunities lie ahead for Hov and Tidal in the future of the music, business, and the culture? Below are a couple of thoughts:
Artists and their work could become the new “assets” for fans to invest in
When Jay-Z launched Tidal in 2015, the “manifesto” stressed the importance of being able “to re-establish the value of music and protect the sustainability of the music industry rooted in creativity and expression”—and essentially, create a place where artists and fans can have a stronger connection. At the moment, that connection is kept by way of the streaming quality of the music and original video content produced on the platform.
But what if the “better tools” Jay refers to involves becoming a hub where major and independent artists can sell merch or create opportunities for fans to fund their next album or music video? What if artists on Tidal could sell parts of their products that fans can collect and exchange with each other? (Heard of NFT—non-fungible tokens aka the new-age version of baseball cards? Hip-hop legends ILL Bill, The Wu-Tang Clan, and the late MF Doom have dropped their own…) All while artists are receiving higher music streaming payouts and truly in control of how their work is exploited. What platform can offer all of this now?
Concert and event ticket payments could become a new feature on the streaming platform and mobile app
When you think Square, naturally you think about the convenience of mobile payments. With COVID-19 preventing the world from living its best social life, many artists have created their own premium concerts and events where they can charge their fans a fee to take part in a virtual experience (see Erykah Badu’s “Quarantine Concert Series“). We could see other major and independent artists with music on Tidal hosting exclusive events where fans can pay for their e-ticket by way of Square’s product, CashApp, or directly at the event’s virtual door by way of Tidal’s mobile app. No third parties involved. Ticketmaster who? Eventbrite what?
Jay-Z and Jack Dorsey could continue their bitcoin partnership and create a Tidal-Square blockchain
Earlier this year, it was announced that Carter and Dorsey joined forces to create an endowment (₿trust) and donate 500 bitcoin (an estimated $24M) to help jumpstart Bitcoin development in Africa and India. At the root of this trust fund, more people in these places will be able to take part in the trading of bitcoin, a form of money called cryptocurrency.
Aside from that, Square allowed CashApp to buy and sell bitcoins and recently bought over $170 million worth of them. But what if Jay and Jack decide to create a Tidal-based blockchain where music lovers can use cash and, say, a “SquareCoin” to pay for digital assets and experiences by their favorite artists?
Jay-Z could be aiming to add more fuel to CashApp’s popularity influenced by hip-hop culture
At this point, hip-hop and Square’s CashApp basically go together and their relationship is getting stronger. Up until now, hundreds of rappers have name-dropped the mobile payment platform over a beat or two. (Somebody cue Roddy Ricch’s “The Box,” please.) Within the last two years, especially during the coronavirus pandemic, hip-hop artists, authors, writers, and other notable figures in the community have used the platform for crowdfunding or to simply give away money to people in need. CashApp has also done giveaways of its own.
Outside of that, artists/content creators like Joe Budden have already inked a brand partnership deal with CashApp. His Joe Budden Network series, Pull Up, includes a “Friends of CashApp” intro with the CashApp logo in the lower-left corner. To date, CashApp has nailed the art of marketing and found success thanks in part to word of mouth within the culture.
But what if Tidal and Square’s new connection leads to more brand partnership opportunities for artists signed to his RocNation label, management company, and overall agency? And what if they join forces to bring more financial literacy opportunities to the people of the culture and beyond?
What do you think this new partnership means for the music industry and the culture? And what will Jay-Z re-invest his new bag into next? We’ll all have to wait and see.