Tidal failed to pay a number of indie labels, according to a Norwegian outlet. Whether caused by negligence or the complexities of paying tens of thousands of labels, publishers and artists, Tidal appears to have given the music industry a reason to be wary.
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By music and music industry journalist Hugh McIntyre
According to a report from Norwegian news outlet Dagens Næringsliv, streaming music platform Tidal may not be paying out the royalties it owes to musicians and record labels in the company’s home country of Norway. The article states that some 1,000 independent record labels haven’t been paid for the streaming activity connected to their artists since this past January. Most of the labels that are experiencing this issue receive their payments through an intermediary organization called Phonofile, which collects the royalties and disperses them according to reports that are supposed to be produced by the streaming platforms. This is the typical practice in most places around the world.
Apparently, Tidal has both failed to create the necessary day-to-day reports of what has been played, and it has also missed quite a few months of cutting checks. The Jay Z-owned service has been late with its payments before, but not for this long, or to this extent, according to those quoted in the piece. Settlements have been reached in the past, and while the two parties may be working on this issue, it is problematic that some indie acts are owed months of royalties.
The report quotes a source that explains that Tidal may not be deliberately ignoring the smaller labels, but perhaps the company isn’t technically up to the task of reporting the sheer number of plays that are occurring on its platform worldwide every day. One of the difficulties that streaming services face is handling the incredible amount of data that is created every time a person listens to a song. This information is important not only to ensure that payments are handled properly, but also because it helps those in the industry gauge which artists and pieces of music are the most popular, and the demographics of millions of music lovers around the world.
At the same time that these accusations are being lobbed at the originally-Norwegian company, a representative for Tidal has claimed that all of its bills have been paid, and that if the money isn’t making it to the bank accounts of record labels and their artists, the problem must lie with Phonofile, which could be falling down on the job as well.
If Tidal has either run out of money and is unable to pay for the music that is played, or if those working at the company simply cannot keep up with their duties, it could help explain why there are so many rumors about the company changing owners. Earlier this year, there were reports that Samsung was looking to shutter its Milk Music service and snap up Jay Z’s latest endeavor, but the tech behemoth shut those down almost as quickly as they appeared. Just last week, theWall Street Journal reported that executives from Tidal and Apple Music had met to begin discussing a sale, though no new details have emerged from those supposed meetings.
UPDATE: Since this article was first published, a source close to the streaming company has provided evidence that Tidal may have paid what was due in a relatively timely manner.