Jay-Z's New Streaming Service.

Hov goes Tidal

"Hola, Hovito. That's what they saying when I roll up with my people."

Just a few weeks ago, in late March, Jay-Z unveiled an innovative and collaborative new streaming service called Tidal. A self-described hustler, Jay is well known for his ambitious undertakings, turning his talent and celebrity into a global brand that includes clothes, beauty products, clubs, even part-ownership of a professional basketball team to go along with his 21 Grammy Awards. Thus begs the question, why a streaming service?

"The Nets could go 0 for 82 and I'd look at you like this shit gravy."

Streaming services have revolutionized the music industry. Pandora began in 2000, at the very dawn of the “singles” era. Not only have they racked up users like nobody’s business, they’ve also flattened the music industry, making it more accessible to more people than ever before. Services like Soundcloud offer artists the opportunity to reach a wide audience without a major record deal. 

Unnecessary.

These services are also ultra-collaborative: any user can download any user-made playlist on Spotify, or Soundcloud. These playlists have become a playground for user comments and conversations. Streaming sites are extremely user-friendly: each has developed a series of algorithms to allow users to explore music similar to their indicated tastes.  

Like any new media, streaming sites have not only revolutionized listening to music, they've managed to earn outrageous revenues while doing so. Pandora earned nearly $900 million in 2014 while Spotify's reported revenue starts with a "B" and ends in "illion dollars." The very same algorithms that determine users' preferences are used to sell ads to targeted consumers. The more data these streaming sites compile, the more accurate and effective the advertisements. 

The most surprising part? Artists are often paid only pennies per play. 

The difficulties with royalties that artists have faced because of streaming services like Spotify and Pandora are well documented. Taylor Swift famously pulled all of her music off of Spotify to protest paltry earnings. The undisputed king of 2014, Pharrell’s “Happy,” was streamed over 40 million times on Pandora in the first quarter alone. His paycheck? $2,700.

So Jay has gone and bought a streaming service, despite Spotify’s 60 million and Pandora’s 80 million active users. The market is crowded and these brands are already well-established. So how is Tidal different?

Well there are a few things that set Tidal apart from the rest of the market. To start Tidal includes music videos. Much more significantly, Jigga has the overwhelming support of some of the industry’s biggest names; the list includes Kanye West, Jason Aldean, Daft Punk, and Madonna, just to name a few. These artists own at least a 3% equity in the company, each. That’s huge. If and when Tidal lands exclusive content, Hov might have something of a runaway success on his hands. 

Because obviously Kanye wants in on this.

However, the collaborating artists are not the only difference between Tidal and its competitors. Hovito promises a much higher quality stream with a bit rate between four and five times faster than both Spotify and Pandora. The quality has been reported as "lossless." This means that when the audio is compressed for download, almost no data is lost, leading to a substantially fuller-sounding song. Although this is not insubstantial, many critics are left puzzled and asking “why?” Most users don’t care about the quality, if they did, they’d listen to vinyls. In addition, the higher quality promises to eat up massive amounts of data, a costly proposition. 

Jigga man might be onto something here. Naturally, it’s way too premature to judge the venture. Like Hova always says, “Mama didn’t raise no fool.” He’s literally a modern day character from a Horatio Alger novel. From slinging crack cocaine to designing clothes and selling out stadiums in Paris, he hasn’t failed yet. His net worth is an estimated $520 million. I’m inclined to give Jay-Z the benefit of the doubt. 

Not an exaggeration.

But how is all of this relevant to new media and convergence? Well, streaming itself is a new media platform. Streaming sites have flattened the music industry and shaped its development for the entire twenty-first century. Tidal, with its music as well as music videos, is seeking to join the fray and devastate the market. 

In terms of convergence, streaming combines all the fun of advertising metrics and market research with the joy of discovering new music. It's an entirely new way for artists to sell music and for advertisers to find the right users to target. The crazy thing is, they're only possible together.