It is official: Jay Z's move into the music streaming business has arrived and he is bringing a lot of his friends with him. At an industry event today at New York City's James A. Farley Post Office in Herald Square, Jay Z announced the launch of TIDAL with his 16 artist partners. The event was live streamed as Jay Z announced his plans for the Hi-Fi service with Madonna, Kanye West, J. Cole, Nicki Minaj, Rihanna, Usher, deadmau5, Jason Aldean, Jack White, Daft Punk, Beyoncé, Arcade Fire's Win Butler, Alicia Keys, Coldplay and Calvin Harris.
The public first noticed that many of the world's biggest act in music were signing on with TIDAL when they started to change their profiles cyan blue at midnight and tweeted out #TIDALforall.
The courting of these top-level artists began after the Grammy's according to Billboard, where Jay Z met with Daft Punk, West, Minaj, Chris Martin, Madonna and Jack White together about the service. Each artist was offered a three percent stake in the company in order to secure exclusives that Roc Nation hopes will drive more consumers to its service, which only has about 540,000 users at the last tally. The total equity given out to artists is about 48 percent after they each signed their deals.
Jay Z bought Aspiro, the parent company of TIDAL and Wimp for $56 million, thought he bid was put in jeopardy by a minority of shareholders who thought the bid undervalued the company.
There are a few stumbling blocks for TIDAL. There is no entry-level "freemium" level for consumers to grow accustomed to the service. Spotify could act as this test ground for TIDAL to get users used to streaming and then they can make the switch over to TIDAL.
The next step will be the most challenging; to convince consumers that paying extra money for higher quality music is worth it. Many fans rip music from Soundcloud and YouTube, which comes out to 128 kbps at best, and are happy with it because they don't know better or don't care. Audiophiles will be happy to try out the new service, but there is also the hardware issue. Some computers may not have a soundcard capable of providing flawless lossless audio to its users and Wifi connections are may not be strong enough to do the same.
Jay Z believes he will be able to turn the tide with consumers and make a mindset change.
People are not respecting the music, and devaluing what it really means," Jay Z told Billboard. "People really feel like music is free, but will pay $6 for water. You can drink water free out of the tap and it's good water. But they're okay paying for it. It's just the mindset right now."
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