Apple Tsumani or Tidal Wave?

Just like another edition of grand opening, grand closing Jay-Z’s Tidal music streaming service debuted with great fanfare, was quickly ushered out of the iPhone Top 20 download chart before plummeting out of the Top 700. Early speculators (aka “haters”) have reputedly said the Tidal launch was nothing short of a spectacular $56 million failure.

Depending on who you ask, Tidal’s launch was branded as an event, a statement and a movement, that not only included the ceremonial pact signing with the artists pledge to tackle fair compensation and improve the current state of streaming affairs for consumers and musicians. Part of this strategy involves offering exclusive content, such as the rumored Jay and Bey collabo CD which appears to be a big part Tidal’s strategy to lure and retain subscribers. Naysayers claim this strategy could very well kill the streaming-music vibe for everyone.

A recent report in the New York Post alleges that Apple may have taken deliberate steps to sabotage Tidal’s launch in order to weaken the competitive landscape ahead of Apple’s soon-to-be-unveiled Beats Music service. As expected, the allegation originated from an anonymous music source from within the music industry. According to the source, Apple purposefully took a longer time than usual to approve updates to Tidal’s iOS app. So while Tidal’s Android app was updated on April 15, the company’s revamped iOS app “still hasn’t received approval for Apple’s iOS app store.” This alleged xxx has not happened since Apple stuck up Google back in 2009.

A Few Tidal and Apple comparisons

Apple is now considering a two-tier pricing approach of $9.99/month for individuals and $14.99 for families since the proposed lowered $7.99 pricing structure failed after UMG’s CEO Lucian Grainge wielded his power and negotiations with record labels were unsuccessful.

Tidal offers two-tier pricing for a monthly subscription with a 30-day free trial, the Premium tier at $9.99 and the HiFi tier at $19.99 via iTunes billing. However, the In-App Purchase subscription cost differs from the subscription price on the Tidal website due to the Apple service fee imposed for using their service. Pricing is set in cooperation with the labels according to their local market standards.

Apple is offering exclusives from major artists. The company has reportedly approaching Taylor Swift and others with major incentives. Word from the curb is Jimmy Iovine allegedly tried to lure some of Tidal’s bigger names such as Rihanna with more money. (Word to Jimmy, the bigger names also have an ownership interest in Tidal)

Jay-Z was joined at Tidal’s press event by other A-list musicians, from several genres, including his wife Beyoncé, Madonna, Rihanna, Kanye West, Usher, Alicia Keys, Arcade Fire‘s Win Butler and Régine Chassagne, Daft Punk, Chris Martin of Coldplay, Calvin Harris, Nicki Minaj, Jack White, Jason Aldean, Deadmau5 and J. Cole, all of whom signed on as co-owners of the app.

Tidal claims to be a friend to the independent artist with Tidal Rising, which gives smaller and indie artists some real estate in the app. Company executives claim the most exciting new feature is Tidal Discovery and although it is slowly rolling out, allows artists to directly upload their music bypassing the third-party service. Tidal is also paying all labels 62.5 percent and according to Jay-Z’s social media post,  paying out a 75 percent  royalty rate to ALL artists, writers and producers. That leaves the company with 25 percent revenue, and they say they’re losing money right now.( Check the math Hov)

Apple has experienced a few hiccups such as key executives leaving the building, a lawsuit and a major delay of the launch of their music service. Insiders indicate that Apple will debut the service at the Worldwide Developers Conference (WWDC), scheduled for June 8-12 in San Francisco, to coincide with the launch of its iOS 8.4 upgrade. According to reports, users who update their phones will automatically have access to it should they choose to join and if they still care.

By comparison, Tidal has “restructured,” by way of staff reduction and taken a (temporary) dip in the rankings.

Tidal boasts over 770,000 subscribers, which may or may not include those subscribers on the introductory 30-day trial. If Spotify took years to reach the one million subscriber, Tidal may be able to steadily  ride the wave and survive. Tidal may also engage subscribers based on the alleged smear campaign and Jay-Z’s recent social media #TidalFacts  claims, most of which have been found to be true.

The use of exclusive releases is more a question of “when” than “if” for Apple’s upcoming Beats Music/iTunes streaming service whatever form exclusive comes to mean once the service finally launches. Consumers can rest assured that Apple will no doubt flex its muscle and sign exclusive deals to compete with Tidal with little regard for the coins they will have to pay.

Who will be the victor?

The best way for these services to attract new users is to promote what makes them different. When your business is providing content, you need stuff that no one else has, and that’s what Tidal has been trying to do as evidenced by Beyoncé’s anniversary present / new song to Jay Z exclusively debuted on Tidal. A bigger point to ponder is Beyoncé’s possible breach of her commitment to Sony Music in releasing music directly via Tidal?????

The longer the launch of Apple’s Beats Music Service has a failure to launch, stiff competition from market leader Spotify along with other streaming services such as Tidal, Rdio, Amazon, CUR, PONO, YouTube’s Music Key (still in beta), Pandora may push them out of the Top 20 apps and down the streaming wave?

The view from the Brooklyn Bridge is not clear enough at this point as the whether or not “Hov an ‘em” can turn the tide and make music history????