…To Also Pockets $75m as Artiste Marketing Fund
Early this morning, slowly dying wireless carrier Sprint announced that it has bought a 33 percent stake in Tidal, Jay Z’s nearly-dead streaming music service. The deal should bring free or discounted access to Tidal’s service to all of Sprint’s customers, in return for a much-needed cash injection for Tidal, and a seat on Tidal’s board for Sprint CEO Marcelo Claure.
On the surface, it’s a deal that makes total sense. Cell companies are beginning to realize that there’s money to be made partnering with content producers, which is why AT&T is spending billions buying up Time Warner.
As part of the deal, Sprint’s 45 million customers will be getting access to Tidal’s music service and “exclusive original content,” although the details of that arrangement are yet to be shared. Sprint CEO Marcelo Claure will take a position on Tidal’s board. According to Billboard, the 33 percent stake in Tidal cost Sprint around $200 million, valuing Tidal overall at around $600 million.
That’s a huge return for Tidal and Jay-Z, whose holding company S. Carter Enterprises LLC bought Tidal’s parent company, Aspiro AB, for $56 million in January 2015. If Billboard‘s sources are right, that would mean Tidal has increased in value by about 970% in the space of two years.
As part of the deal, Sprint is also committed to a $75 million annual artist marketing fund.