NEWS
NEWS
NEWS
Poor diddums: Jay Z sues previous Tidal owners because he didn’t do his due diligence properly
Jay Z appears to be a very unhappy musician with reports Thursday that he was taking legal action against the people he purchased streaming music service Tidal from over allegedly inflated subscriber numbers.
The legal action itself is being taken Project Panther Bidco, Jay Z’s holding company and is seeking compensation, claiming that the purchase price was inflated based on false subscriber numbers.
“It became clear after taking control of Tidal and conducting our own audit that the total number of subscribers was actually well below the 540,000 reported to us by the prior owners,” Project Panther Bidco said in a statement. “As a result, we have now served legal notice to parties involved in the sale.”
According to The Verge the difference in subscriber numbers could be due to a series of subscription deals then owner Aspiro had with partners, where those partners gave away paid subscriptions to the service with cell phone purchases, apparently accounting for 391,000 of the original 503,000 subscribers originally claimed.
“We disagree with the accusations in the letter and any potential claims,” a spokesman for the original owners said in a statement sent to Bloomberg. “We would like to point out that the company was listed on the stock exchange with everything that entails regarding transparent financial reporting.”
Diddums
This is a case of a musician who arrogantly thinks somehow his arguable skill as a musician would somehow translate into running an online business against the likes of Spotify AB and Apple, Inc., both run by tech veterans who didn’t spend their younger years as a street thug who shot people.
Business lesson 101 when making an acquisition is to do due diligence, and in the case of Tidal, as pointed out by parent company Aspiro they are listed on the stock exchange and all their figures were on public display to begin with; instead of suing Aspiro perhaps Jay Z should sue his business advisors who clearly didn’t do their homework properly.
The only reason Tidal has 3 million paid suckers subscribers today is due to landing the latest Kanye West album exclusively, and if you need to rely on Kanye West to stay in business we probably don’t need to spell out the gross lack of business acumen to begin with.
Image credit: everyskyline/Flickr/CC by 2.0
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