A Norwegian newspapermade huge waves in the music streaming industry on May 9, claiming that on-demand music streaming service Tidal had manipulated listener data for two of its biggest artists: Kanye West and Beyonc.
The accusations surround both artists’ most recent albums, Kanye’sThe Life of PabloandBeyonc’sLemonade, with the newspaper claiming that it had gained access to royalty reports and a hard drive that contained “extensive data” regarding Tidal’s streaming plays. Tidal had exclusive streaming rights to both albums when they launched. Tidal owner Jay-Z is married toBeyoncand is a longtime friend and collaborator of West.
Rolling Stone has since reported that Tidal has contracted a third-party cybersecurity firm to investigate the data breach. The company still denies the allegations made by the story and says it is undertaking the investigation as a means of reassuring its customers that their data is secure.
“Although we do not typically comment on stories we believe to be false, we feel it is important to make sure that our artists, employees and subscribers know that we are not taking the security and integrity of our data lightly,” Tidal CEO Richard Sanders told Rolling Stone.
The newspaper, Dagens Naeringsliv, worked in collaboration with the Norwegian University of Science and Technology to analyze the data, producing a reportwhich claims that more than 320 million false plays had been logged for the two albums on more than 1.7 million user accounts. In March 2016, Tidal claimed that The Life of Pablo had been streaming 250 million times in 10 days. The streaming service claimed that Lemonadehad 306 million plays in just 15 days following its release.
A later article from Dagens Naeringslivthat was published Wednesday, May 16 claims that Tidal has also failed to make royalty payments to some major labels since October of 2017.
The company had yet to respond to the newer allegations of delayed payments as of publishing time, but Tidal representatives have vehemently denied the earlier claims that the company manipulated streaming plays, citing instances in whichDagens Naeringsliv has previously shown malice against the company.
“This is a smear campaign from a publication that once referred to [Chief Operating Officer Lior Tibon] as an ‘Israeli intelligence officer’ and our owner as a ‘crack dealer’,” Tidal said in a statement. “We expect nothing less from them than this ridiculous story, lies,and falsehoods. The information was stolen and manipulated. And we will fight these claims vigorously.”
The titles lobbed at Jay-Z and Tibon are misleading, but they do have at least some root in reality; Jay-Z has previously admitted to his involvement in the drug trade in the 1990s, including during a recent appearance onMy Next Guest Needs No Introduction with David Letterman. Tibon lists four years as an officer in the Israeli Defense Forces on his public LinkedIn page.
Many may be wondering why Tidal would want to skew its own streaming numbers in the first place. After all, you may think that increased plays would just cost the streaming service more money in royalty payments overall, thereby hurtingthe company. That is not true, as Billboard points out. Due to the nature of its contracts with major labels, Tidal — as well as competitors like Apple Music and Spotify — pays royalties from a percentage of revenue, not based on the total number of plays in a given term. This means it would simply shift the proportion of money they would have already paid other labels and artists towards West andBeyonc.
There a few reasons this may have been in Tidal’s interest, should the allegations be true. First, it would have garnered increased publicity for two of its biggest artists. Second, it would have increased Tidal’s position and valuation in the marketplace — potentially profiting the company in terms of its increased ability to sell equity (Tidal sold a 30 percent stake in the business to Sprint in early 2017). And third, it would have made both artists over a million dollars in extra royalties, provided they were paid the “superstar” royalty rate of 50 percent on streaming from Def Jam and Columbia, the labels that produced the albums.
A spokesperson for the university that provided the data analysis says that the company has not been able to determine the source of the alleged data manipulation.
“Our researchers have used advanced statistical analysis methods to reach this conclusion,” the spokesperson said, “However we cannot, based on the data provided to us, determine the source of the manipulation.”
Tidal claims that the data was stolen and manipulated byDagens Naeringsliv itself. One thing the study did indicate is that the data was unlikely to have been manipulated by a software bug or by accident.
“Due to the targeted nature and extent of the manipulation, it is very unlikely that this manipulation was solely the result of a code-based bug or other anomalies,” the study reads.
“[It]is highly likely that the manipulation happened from within the streaming service itself,” concludes professor Katrin Franke, who led the university team.
As part of its extensive story,Dagens Naeringsliv interviewed numerous affected customers, whose accounts show numerous plays of the album during odd hours.
Music critic Geir Rakvaag, for example, is shown in the data to have listened to songs fromThe Life of Pablo 96 times in a single day, and 54 times in the middle of the night.
“It’s physically impossible,” he claims in the story.
We’ll continue to keep tabs as this story develops. As for whether or not Tidal actually did manipulate user data to generate bigger publicity and profits for two of its biggest artists: Time will tell, and numerous lawsuits are likely forthcoming.
Tidal’s lawyer, Jordan Siev, is quoted byDagens Naeringsliv in the article as saying, “As each of these assumptions is demonstrably false, you and DN lied to NTNU to procure a study.”
Updated on May 19: Added news onTidal’sinvestigation into a possible data breach.