Tidal could be shutting down by the middle of next year. A new report coming out of Norway suggests the music streaming service barely has enough cash on-hand to keep the business running for six months.
The service, which Jay-Z purchased and relaunched more than two years ago, is believed to have lost $44 million in 2016. Sprint purchased a 33 percent stake in Tidal in early 2017 for $200 million; however, all of the money appears to have been spent. The deal should have given Tidal enough working capital to last a year, but now there’s trouble as virtually nothing is left.
Here’s what a Tidal spokesperson told Engadget about the report:
“We have experienced negative stories about Tidal since its inception and we have done nothing but grow the business each year.”
Tidal goes on to say it should break even relatively soon, and the service could be profitable sometime in 2018. That’s a much different outlook than what’s suggested in the Norwegian report. It’s hard to imagine Tidal rising up in a space where Spotify holds a massive lead and Apple Music is making remarkable gains every month. Although Tidal arrived with exclusives from Jay-Z and other big-name artists, the service hasn’t been able to become relevant globally.
While initially making announcements every few months about milestones, Tidal’s been very quiet when it comes to sharing the number of subscribers it has. The last figure from the service itself was 1.2 million subscribers. But Tidal’s been accused of inflating numbers to look better to the public. Spotify and Apple Music, meanwhile, combine for around 100 million subscribers.
Assuming what’s being said is true, Jay-Z may have to shut down the service by the summer or sell it to someone else.