Tidal Might Lose All of Its Beyoncé Songs, But Who Even Cares

Beyoncé is among several artists/partners who’ve dropped exclusives on Jay Z’s streaming service Tidal, including a homemade serenade and the “Feeling Myself” video with Nicki Minaj. Beyoncé might not be able to do that for long, thanks to her label Sony.

Jay Z can’t work fast enough to ease the pain and criticism of Tidal that’s been nonstop since the service launched in March. While he’s out there trying to generate positive publicity (i.e. his B-sides concert this month), new problems arise.

This Bloomberg Businessweek piece about Tidal’s epic failures reveals that Sony is A-OK with removing all of its artists’ music from Tidal if a payment agreement isn’t reached. As Vulture points out, Sony just did this with Soundcloud, because record labels are asshole conglomerates and everyone’s greedy.

According to Businessweek, Jay Z is basically strapped and could use a hefty investment. Unfortunately, talks right now between Sprint and SoftBank are still premature:

Jay Z was apparently counting on the investment to pay some bills. When he acquired Aspiro, the change of ownership meant he had to renegotiate its streaming contracts with the three major record companies: Universal, Warner, and Sony Music Entertainment. Universal distributes the records of some of Roc Nation’s artists, so Jay Z was able to quickly reach an agreement with that company. But music industry people who are familiar with the negotiations and forbidden from discussing them publicly say that Sony and Warner are asking Tidal for large advances in return for the right to feature their artists’ catalogs. (None of the record companies would comment on Tidal.) A source close to Tidal said that the company’s financial condition is fine and that it reached a streaming rights deal in late May with Warner.

Sony, however, remains a holdout:

…if Jay Z can’t come up with the cash for Sony, he faces the possibility that Tidal might lose albums from some of its co-owners, most painfully Beyoncé, a Sony artist. “I’m pretty sure most of the artists that were at the press conference don’t control their own streaming rights,” says Peter Mensch, co-founder of Q Prime, the talent agency that manages the Red Hot Chili Peppers and Metallica.

That’s a really big If. Would this mean no Beyoncé exclusives for the thousands of subscribers who’ve only signed up for Tidal for Beyoncé exclusives? Really, no one cares because Spotify is, like, right there. But it’s clearly a problem for Jay Z. This nightmare pilot phase is turning out to be a huger headache than he likely imagined.

Businessweek mentions another obvious hurdle for Tidal, which is recruiting people to actually pay for Tidal:

To keep his company from becoming a money pit, Jay Z also needs to line up many more Tidal subscribers. Tidal claims to have 900,000 users, but analysts suspect many have signed up for trials and will cancel when they have to start paying. Early on, Jay Z called some of his customers to see how they liked Tidal—a humbling act for a guy who calls himself J Hova (as in Jehovah). Tidal also hasn’t denied rumors that he will release a long-awaited album with Beyoncé exclusively on the service.

To be fair, getting people to pay for shit is and will be the biggest pain for any streaming service, old or new, trying to survive. Or any music-consumer related thing in general. Much of the criticism has, rightfully, attacked Tidal’s poor marketing. But it also revolves around a lot of conditionals to which NOBODY has the answers. Businessweek does add that it’s “still too early” to consider Tidal a total failure, which is true.

Super hot take: Everybody just chill a little bit. Not to excuse Tidal’s terrible series of PR events so far, but Jay Z’s doing this under a much closer lens than Spotify, which benefited from bubbling organically. Beats Music meanwhile has the salvation of Apple and iTunes to fall back on.

Tidal primarily seems useless right now (although I think the app is a decent user experience), but it might not be in a while if they fix things. The streaming business is a crapshoot and no service succeeds without snags. Even Pandora is still trying to turn a profit and it’s a dinosaur in comparison.