Streaming service Tidal, it seems fair to say, has suffered a few missteps since its ill-fated launch. There was the much-mocked celebrity-strewn launch, the revolving door approach to appointing CEOs and the constant barrage of snark from artists and online commentators alike.
Even last week’s Tidal exclusive on Rihanna’s Anti album somehow managed to incorporate an untimely leak, with the streaming service claiming Universal Music was to blame.
But the album also racked up almost 14 million streams on the service in its first 14 hours of availability, the first signs that the, um, tide might be turning.
Tidal have not announced whether the exclusive prompted a surge in sign-ups to the service – although it seems fair to assume it will have drawn some of the Rihanna Navy footsailors in – but those figures show that the service is certainly being used by those already signed up.
But the real game-changer might just be its hi-res service, Tidal HiFi. This charges a $19.99/£19.99 per month price – double Tidal’s standard monthly $9.99/£9.99 subscription. Which means hardly anyone has signed up for it, right?
Wrong, as it turns out. In this week’s Music Week streaming special, Tim Riley (pictured), Tidal’s SVP, artist relations, revealed: “I don’t know if I’ll get in trouble for saying this, but I think over half our users are HiFi users. That’s interesting, that people do care about quality and assign value to quality, that’s a real positive thing.”
It’s certainly a positive thing for Tidal’s revenues. Owner Jay Z announced Tidal had hit one million subscribers in September which, according to Riley, means it added around 600,000 new users in the six months or so the rapper had owned the service to that point.
No new figure has been announced since – though Riley said the number of subscribers has continued to rise. If Tidal had carried on acquiring subscribers at the same approximate rate – 100,000 per month – it would now have around 1.4 million subscribers. Of course, we don’t know how many of that initial one million were on a free trial that may since have lapsed, and new sign-ups may well have slowed since the high-profile, albeit botched launch. Then again, they may also have speeded up, thanks to Tidal’s involvement in big campaigns from The Beatles and Coldplay, plus that Rihanna exclusive.
Either way, if over half of subscribers continue to be HiFi users, they have the potential to transform the company’s finances much more quickly than if it was relying on standard users alone. Even at a straight 50/50 split between standard and HiFi users, it means one million US Tidal users are worth $14,990,000 per month – a whopping $5 million more per month than the same number of users at other, $9.99-only services. Or, to put it another way, Spotify et al need over 1.5 million subscribers to generate as much cash as one million Tidal subscribers. If Tidal’s HiFi users represent significantly more than 50% of the total, those figures will skew even more in their favour. Plus Jay Z doesn’t have the costs associated with running a free tier and the higher yield per subscriber will, presumably, mean better returns for the music industry which may, in turn, lead to further exclusives.
Of course, Spotify, Apple and co have scale where Tidal doesn’t. But if Tidal can maintain or even improve on that ratio of premium users, scale will be less important than it is for most of the other services out there. Plus it might just establish itself as the high-end streaming service of choice.
If so, Tidal might still have 99 problems, but its niche, seemingly, ain’t one.