Square extends its mission of economic empowerment to musicians.

Square Inc (NYSE: SQ), the payments giant, announced today its acquisition of a majority interest in TIDAL, the audio and video streaming platform led by Jay-Z, for $297 million in cash and stock. Existing artist shareholders will be the remaining stakeholders, the announcement said, and Shawn “JAY-Z” Carter would be named to Square’s board of directors. (Square)

TIDAL

Jay-Z acquired TIDAL in 2015 for $56 million in partnership with other artists. These include Beyoncé, Jay-Z’s wife, and Rihanna.

He sold a third of TIDAL to Sprint (now T-Mobile) in 2017 on undisclosed terms. Preparatory to the deal with Square, Jay-Z bought back those shares from T-Mobile (NASDAQ: TMUS). These shares will likely head for Square, according to the NYT.

The transactions reflect the intense competition in the music streaming industry, with big, listed names such as Apple (NASDAQ: AAPL), Amazon (NASDAQ: AMZN), and Spotify (NYSE: SPOT) calling the shots.

Post-acquisition, TIDAL will operate independently within Square, alongside the Seller and Cash App ecosystems.

Why music?

“Square has helped millions of businesses start, run, and grow by providing them with tools needed for success,” the company said. “The acquisition extends Square’s purpose of economic empowerment to a new vertical: musicians. Square sees an opportunity…to help musicians find new ways to support their work and make better decisions through TIDAL.”

Jay-Z revealed that he’d had “many discussions” with Jack Dorsey, co-founder and CEO of Square, about TIDAL.

Jesse Dorogusker, a Square executive told the NYT that the two began to discuss the transaction a few months ago. What started as a conversation led to a sense of common purpose.

“New ideas are found at intersections, and we believe there’s a compelling one between music and the economy,” said Dorsey.

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