At its glitzy launch event Monday, Jay Z promised his newly purchased music streaming service Tidal would usher in a musical revolution. But after a whole day of anticipation building on social media, the backlash was swift, with people deriding the 17-minute event as grandiose and out of touch.

Fans hearing about the service for the first time balked at the $20 premium price; musicians both famous and not so famous questioned whether the service would serve different sectors of the musician community equally; Bill Werde, the former editor in chief of “Billboard,” wondered at the lack of detail about how Tidal will serve artists more effectively than competitors. Newspapers piled on too, calling the event and its speakers “pompous” and “pretentious.”

It’s too early to tell whether the negative chatter will permanently cloud Tidal as a product, which operates well and, as expected from a company that offers lossless audio, sounds excellent. But nobody gets a second chance to make a first impression, and it’s possible that Monday’s presentation, which attempted to frame Tidal as a panacea for the music industry’s problems, could make it harder for the site to succeed before it has even rolled out a full picture of what it offers. 

“It's fascinating to me that there's been such backlash,” said Vickie Nauman, the founder of Cross Border Works and a former executive at digital music store 7Digital. “They didn't even really reveal anything they were going to do.”

Premium Pricing

Perhaps the biggest problem facing Tidal is its perceived price. The average American consumer spends $109 per year on music, with the largest single share of that money – more than $35 -- going to concert tickets. Even if all the rest went to streaming services, it wouldn't cover the $9.99 monthly subscription to Tidal’s basic tier. Yet the bigger problem Monday was that the event’s audience completely ignored the basic tier -- which is no different than Spotify or Rdio -- and focused instead on Tidal’s $19.99 premium tier, which offers far superior audio quality but is also twice the price.




Serving Whom?

Aside from a small blip of business news – Tidal has partnered with the Japanese telecommunications giant SoftBank in some unspecified capacity – Monday's event was mainly devoted to rhetoric about how Tidal would serve artists as well as fans. “We want to create a better service and a better experience for both fans and artists,” Alicia Keys said.

Which artists Keys referred to remains unclear. One of the big hurdles streaming music services face, as they account for a growing share of industry revenue, is the question of compensation. Most of the services already out there forked over huge cash payouts to record labels in exchange for a smaller streaming rate for their artists. This low rate has been a sticking point for a number of artists, and while a higher streaming rate would surely do a lot to endear Tidal to artists, no such details were mentioned during Monday’s event.

Indeed, some wondered whether the only artists likely to benefit were the ones standing on stage. According to an analysis by MIDiA Research, the music industry’s top one percent earns 77 percent of all the industry revenue, a trend that streaming services have exacerbated. "The evolution of streaming music is one in which the deck is stacked strongly in favor of the superstars," MIDiA co-founder Mark Mulligan said.

Industry Skepticism

So far, not everybody is convinced Tidal will change that power dynamic. Over at Hypebot, a music industry website, a poll asking who Tidal serves -- “#TIDALforALL or TIDALforNOONE?” -- has returned very unambiguous results, with nearly three quarters of respondents choosing the latter.

“The poll results are a reflection of their concerns - as in, ‘How is Tidal better for me?’" Bruce Houghton, the president of Skyline Music and the editor of Hypebot told International Business Times. “There is some understandable backlash over this being about further enriching 16 already rich artists.

“I'm still hopeful,” Houghton added. “These are smart people who, I believe, care about music as well as commerce. It would be particularly disappointing if they did not work to help other artists who are struggling as they once did.”

The specifics of how Tidal will compensate artists are sure to trickle out soon. But until that happens, the company may be stuck fighting perceptions as well as its competitors, an irony when one considers that, until Monday, its image as a venture run by some of the business's top artists was one of its greatest strengths.

“It's not going to be bootstrapped artists that are going to invest in a major digital asset,” Nauman said. “It is going to have to be people with money.

“I would certainly rather it be in the hands of some artists and creators for a change,” she added.