Search The Line of Best Fit
Search The Line of Best Fit
Listening headphones music stock

Tidal struggling to stay afloat? Reports suggest it'll be out of cash by next summer

13 December 2017, 14:55 | Written by Laurence Day

Reports in Norwegian newspaper Dagens Næringsliv suggest that Jay-Z's streaming giant Tidal could be out of money in six months' time.

Jay-Z acquired Tidal and Aspiro in 2015, and earlier this year secured an enormous $200 million cash injection after selling 33% of the company to Sprint. According to Jay-Z's business partner Juan Perez this sum gave Tidal "sufficient working capital for the next 12-18 months."

These reserves could dwindle to zero by next summer unless they find further investment or have secretly managed to stockpile funds - but the latter seems unlikely given that Tidal has yet to break even.

Tidal lost $44 million (before taxes) in 2016, and Dagens Næringsliv say that Jay-Z and the other current owners have lost almost "half a billion" since taking the reins almost three years ago. They also claim that operations are largely funded by loans from the Cayman Islands: "The accounts show that operations until December last year were funded through large, interest-free loans from the owners' holding company, located on the Cayman Islands in the Caribbean Sea: $69 million in 2015 and a further $36 million last year."

This isn't the first time that Dagens Næringsliv have dug the Norwegian-developed service, which still has headquarters in Oslo. The paper has also reported that Tidal's subscriber numbers are considerably less than the figures they've claimed in the past, and when Jay told the world Tidal had hit three million subs, Dagens Næringsliv reported that the service had less than a third of that number.

Tidal have refuted all these reports, with a spokesperson telling Engadget: "We have experienced negative stories about Tidal since its inception and we have done nothing but grow the business each year." Far from going bankrupt, the spokesperson also states that Tidal could even become profitable by mid-2018.

Read more on Dagens Næringsliv and Engadget.
Share article

Get the Best Fit take on the week in music direct to your inbox every Friday

Read next