Streaming platform TIDAL is partnering with Universal Music

Announced last week by Universal, the new partnership between the world’s biggest music publisher and streaming service TIDAL has been formed with the intention to research and devise a new streaming model that better supports the value of artists and their work, while encouraging more engagement from subscribers.

Head of TIDAL Jesse Dorogusker said, “We’re setting aside our current fan-centred royalties investigation to focus on this opportunity for more impact.” The research conducted by TIDAL and Universal will seek out ways to better monetise fandom, while accelerating subscriber growth and retention of existing subscribers. We’re thrilled to partner and learn along the way about the possibilities for more innovative streaming economics,” Dorogusker continued. “This partnership will enable us to rethink how we can sustainably improve royalties’ distribution for the breadth of artists on our platform.”

A similar, fan-driven approach to royalties distribution was developed and piloted by SoundCloud last year. This model compensates artists based on the number of actual listens they receive. The model is optional to use on the platform, So far, the only major label who has adopted SoundCloud’s new model is Warner Music

The current standard model for streaming services has drawn criticism for favouring major labels when it comes to shares of royalties, particularly ‘The Big Three’ labels, of which Universal is the largest. Last year, the ten year ban placed on UMG by competition watchdogs which prohibited the label from acquiring certain assets following the company’s acquisition of EMI was lifted. UMG also recently acquired a majority stake in indie distributor PIAS.