Celebrity-owned streaming service Tidal have allegedly reported more than US$28 million losses in 2015. The service, owned by Jay Z and investors including Jack White and Daft Punk, has made a name for itself for championing high fidelity recordings, videos and exclusive content.
According to the Wall Street Journal, Tidal’s holding company, Aspiro AB, recorded a net loss of 239 million Swedish kronor, around $28 million. This is more than double their 2014 losses, totalling 88.9 million Swedish kronor. That said, Tidal’s revenue saw a 30% rise during the same time period.
Spotify’s losses were up around 184.5 million euros, 20 million more than 2014. However, its revenue rose by 80% in that time.
Tidal has made a name for itself by way of release strangleholds, bringing exclusive albums to the service which are unable to be found on others. Albums by Beyoncé, Rihanna and Kanye West are among the many which have received exclusive Tidal releases this year. While their user numbers have risen to more than four million, it’s still nothing compared to Apple’s 17 million and Spotify’s 30 million paying subscribers.
WSJ report that the company has been struck with copyright fees, royalties and so on from record labels, at a cost much higher than that earned from customers paying a monthly usage fee. Around 300 million Swedish kronor went to royalty fees, out of a total 402 million kronor in revenue. Compare this to Spotify whose revenue was around 1.95 billion Swedish kronor.
Aspiro are still hopeful, though. While Tidal doesn’t have funding for the forthcoming year, they are still confident that “the company will be able to secure new financing.”
Luckily it’s owned by celebrities who have more than a few million dollars lying around, but the future of Tidal still hangs in the balance. There’s only so many times you can force a customer to sign up simply by cornering the market entirely – particularly now that record labels have begun backing down from exclusive streaming releases. While exclusive may be enough to get people to sign up, they aren’t sticking around.