Just over a year after buying struggling streaming service Tidal, rap mogul and titan of industry Jay Z suspects the former ownership group may have misstated the number of Tidal subscribers pre-acquisition.
In a letter sent to Tidal’s former owners, Jay Z’s legal team said:
“Panther has learned that the actual number of subscribers at that point in time was significantly lower and that the amount represented in the due diligence documents were greatly overstated.”
It’s a claim that was quickly rejected by the site’s former owners.
“We disagree with the accusations in the letter and any potential claims,” a Schibsted spokesman said. “The buyer also did a due diligence of the company. It is worth noting that this was more than one year ago.”
In March 2015, Jay Z purchased Tidal from a Norwegian media group, Schibsted ASA, for $56 million. Since then, the service has been blasted for non-payment of royalties, questionable decisions, general apathy from ownership and most recently, acquisition talks (although Samsung later denied its interest in acquiring Tidal).
The 💜 of EU tech
The latest rumblings from the EU tech scene, a story from our wise ol' founder Boris, and some questionable AI art. It's free, every week, in your inbox. Sign up now!
Tidal representatives are said to have served legal notice to the parties involved that the March 2015 sale reported 540,000 users, while an internal audit revealed only 17,000 of those were subscribing directly to Tidal.
Another 391,000 had access to the service via partnership agreements with cellphone providers and TV subscription packages.
Get the TNW newsletter
Get the most important tech news in your inbox each week.