Tidal’s tricky proposition in its battle with Spotify

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Having a clear proposition in your approach of the modern consumer is crucial. Jay Z’s acquisition and relaunch of music streaming service Tidal earlier this year, presents us with an interesting case for analysis here on Triggerpulling.

A fair share

Tidal has been getting a lot of stick in the media. And let’s face it, the press event at the launch of the service was a communications blunder. In case you’ve missed it: Jay Z appeared on stage with a group of multi-millionaire superstars (including Kanye West, Madonna and Daft Punk) ranting about how traditional music streaming companies such as Spotify short hand the artists. Obviously, any communications pro would have brought a bunch of struggling emerging talents to the stage to convey that message. The criticism was massive.

But let’s forget about this false start, as it has been analyzed and ridiculed all over the web before. What interests me is the actual value proposition here. The point is that Tidal claims artists don’t get a fair share of the revenues made by services such as Spotify. Wether that’s true or not, the real question is wether that forms a good value proposition towards consumers. Shouldn’t that be a battle between artists, labels and platforms such as Spotify, rather than a selling point for an alternative service? It seems Jay Z is appealing to the moral compass of Spotify users, to trigger them to switch to Tidal. Once you have, there’s no way of actually noticing it in your daily use of the service. All in all, a bit of a weird selling point.

Music videos

Another weird one is the inclusion of music videos as part of the value proposition. Granted, it is a lot of fun to check out the latest videos in lovely HD quality while browsing for new music. The problem is, consumers are used to music videos being free. Back in the day we watched MTV for free and more recently most music videos were available on Youtube, for free. Now wether that’s right or not doesn’t really matter anymore, as the economic value of music videos in the mind of the general public is zero. So starting to charge for them is going to be a tough sell now.

Exclusive content

All music streaming services are trying to add perceived value with exclusive content. In the case of interviews or live sessions that could be of great value. Many now try to tie down artists to their own service exclusively as well. This might mean that if you are a big fan of artist X, that you are pretty much tied to a particular music streaming service. I get the business value of this, but it does seem like a negative approach of the consumer. If this development catches on, you will need to have three or four subscriptions in the near future to have access to all music. That would, in my eyes, push people back to illegal downloading once more. It is a classic example of thinking business, rather than thinking customer, which got the music industry into its problems in the first place.

Audio quality

I, personally, have switched from Spotify to Tidal recently for one simple reason: Lossless audio. I am a music lover and a bit of a hifi geek so I want to feed my external DAC, headphone amplifier and way-too-expensive headphones with CD quality music. At the moment only Tidal and small player Qobus offer music that has not been compressed to mp3 or AAC quality. The killer selling point for me.

The internet is full of reviews of people asking random people in the street wether they can hear the difference in quality. The outcome usually being ambiguous. This results in many media advising against paying extra for higher quality. There is a problem in this argument though.

First of all, to appreciate high quality audio, your ears must know what to listen for. If you have grown up consuming music via Youtube or downloading all sorts of compressed MP3 albums, you’re unlikely to know what music should really sound like. Without any sort of training, you will have a hard time noticing the quality increase Tidal offers. A by-product of a long period of presenting music in low-fi formats.

Second, an audio chain is only as strong as its weakest link. Converters and amps in smartphones and computers are usually of poor quality. As are iPhone earbuds or Beats by Dre headphones. So indeed, the difference in source material quality can seem minute, simply because the rest of the chain is so poor. Presenting people with cheap headphones, plugged straight into a smartphone, on a noisy street with a listening test is therefore completely unfair.

Obviously, all the above makes audio quality a tough sell as well. Tidal pretty much have to educate the majority of music lovers on what to listen for and what equipment to use. With a youthful image with a focus on pop and urban music, I doubt the trained hifi lover is likely to feel a connection with Tidal as a brand. What remains are the weird exceptions like myself.

The other debate is wether lossless audio is worth a doubling of the monthly fee. I personally think there is no problem here. People who value CD quality audio likely spend thousands of euros on audio gear. I think they would happily lay out a few extra bucks for a good source of music as well. And quite simply put, there is no legal alternative at a lower price point.

I am afraid though, that unless lossless audio becomes part of the basic subscription tier, Tidal is unlikely to reacquaint the masses with CD quality audio. It remains a killer selling point, but for a small target audience.

A consumer focused value proposition

It seems, all in all, that the relaunch of Tidal could have been thought through a little better. It is a perfectly good product, that holds its own next to the king of the market Spotify. But the true distinctive value from a consumer point of view, has not really been emphasized enough. In fact, in daily use, for me it is only the audio quality that does it. I would not know why anyone would switch from Spotify to a Tidal non-hifi tier. What do you think? Has the Tidal proposition been too much about Tidal and not enough about you as a music fan?

Thomas van Straaten

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