Celeb Backed Music Service Tidal A Predictable Flop

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Beware celebrities looking to ‘disrupt’ established industries with powerful players at the top of their game. Tidal, the flashy streaming music service purchased by rapper Jay Z last month, looks set to join the ranks of Justin Timberlake backed Myspace, according to recent data.

Tidal’s bizarre launch, where the core message was ‘While other streaming music services like Spotify and Pandora pay a pittance to artists, Tidal offers musicians a better deal’ should have served as big red flag. Company launches typically focus on the value proposition to customers not suppliers.

The launch was even more bizarre because Tidal opted to use super stars like Nicki Minaj and Beyonce as spokespersons for the app. This resulted in the ultimate mixed message: You should feel sorry about how little money a megastar makes.

Two weeks after the sugar high of free publicity the app has crashed out of the top 700 hottest apps. Predictably American consumers have limited sympathy towards Beyonce and Nicki. Since re-launching the owners (we presume Jay himself) have kicked Tidal’s CEO to the curb in a “streamlining” move. The new CEO is a former consultant for the Norwegian Ministry of Environment – an odd choice of management in an industry that demands both technology and media experience.

As Tidal hits the rocks its main rivals are surging. As of April 20th, Pandora and Spotify held positions No. 3 and No. 4 on the U.S. iPhone revenue chart, respectively. This is notable as it marks the first time two music streaming services have hit the top 4 in sales at the same time.

In order to achieve this Pandora and Spotify had to knock Candy Crush Saga out of U.S. iPhone top 4 revenue chart, which is a stunning achievement.

A curious pattern can be observed in Spotify’s download performance immediately following the Tidal media campaign that bashed its allegedly meager payouts. Spotify rocketed back into the iPad Top 40 download chart on March 31st, right when Tidal’s anti-Spotify invective hit fever pitch in American media. The last time this happened was November 2014.

From this data it appears that Tidal’s attacks on Spotify and Pandora actually managed to increase public awareness of the services, notably increasing Spotify’s download performance at the end of March. A few weeks later and the combined revenue performance of the two music apps is hitting a new milestone. Beats Music, widely considered to be the motivating factor for Jay & Co. to get into the streaming game, has now started cracking U.S. iPhone top 20 revenue chart.

Tidal is now facing three deep-pocketed rival music apps that are all minting money and riding strong momentum. Apple is also currently working to enter the fray with what will no doubt be a very strong and extremely well financed product.

Tidal’s new CEO must somehow find a way to fix the disaster of a launch and find a way to position Tidal in a crowded market without giving its rivals extra attention.

We’ve seen this before with Myspace and we know how it ends. Tidal will continue to be an also-ran service run by poor managers who lack the necessary skills to compete effectively with the competition. We give the service 18 months before it officially closes up shop and you can expect the bell to start tolling well before that. R.I.P Tidal, we hardly knew ye.

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