On April 6, Quibi started , a streaming service exclusively for mobile devices with episodes of TV shows and shows no more than 10 minutes.
Founded by Quibi, Jeffrey Katzenberg – he previously worked as the CEO of DreamWorks Animation SKG and chairman of the board of directors of The Walt Disney Company. In this he was helped by the entrepreneur and former CEO of eBay Margaret Whitman – she also became the executive director of the company.
As conceived by the authors, Quibi was created for busy people who do not have time to sit at the TV screen, but they can afford to be distracted by a 10-minute episode on the phone. However, the service was launched in the United States and Canada at a time when millions of people are forced to sit at home because of the pandemic.
A week after the release, Quibi dropped out of the top 50 most downloaded free apps on the App Store, and ranks 125th after Knock’em All and Duolingo.
According to the analytic firm Sensor Tower, even taking into account the free 90-day trial subscription, the application was installed only 2.9 million times. The company itself claims that this number is slightly higher – in the region of 3.5 million, but only 1.3 million of them are active users.
In an interview with NY Times, Katzenberg said that all failures are attributed to coronavirus and pandemic.
Everything that went wrong, I attribute to the coronavirus. All. But we take this into account.
Founder of Quibi
Katzenberg said that he was disappointed with the first figures of the application. According to him, it was not even close to what they were counting on.
With the help of Hollywood studios and the Chinese company Alibaba Group, Katzenberg and Whitman raised nearly $ 1.8 billion to finance Quibi. For investors, they promoted it as a mobile service for watching short series while traveling at work, but since then, people’s living conditions have changed markedly.
Launching the service in April, Katzenberg hoped that even during a pandemic, people would have a reason to take a smartphone and watch an episode of the show there, rather than on the screen – in reality, everything turned out differently.
For some time, the creators defended the concept of an exclusively mobile application, but in the end they decided to please the users and allowed them to watch episodes of TV shows like “The Most Dangerous Game” on the TV screen – so far only on the iPhone. According to the authors, a little later Quibi will become less dependent on the Internet and users will be able to share content on social networks.
In addition to internal failures, the service managed to find itself in the center of a scandal with other companies. So, Eko accused Quibi of misappropriating trade secrets and violating a patent for a technology that allows you to seamlessly switch between horizontal and vertical viewing.
Meanwhile, articles appeared on the network that several services, including Quibi, were distributing users ’email addresses without their knowledge. Katzenberg stated that they corrected the mistake as soon as they found out about it.
Initially, in the first year of life, they planned to spend about $ 470 million on advertising the service – now the creators will work on a new strategy with a much lower marketing budget.
In addition, Quibi executives are lowering their forecasts for the first year – previously they were counting on seven million users and $ 250 million in profit. Following the film studios, the company decided to slow down the pace of the release of new shows in order to be able to offer new content in 2021.
Despite a difficult launch, Katzenberg is optimistic and hopes that after the pandemic, people will return to using their phones again, as the creators and investors of Quibi had hoped. According to him, now every episode of a show is watched by 80% of users.
Finally, Katzenberg was asked about the impact of a successful TikTok, given that he has a similar concept with Quibi, but instead of TV shows, user-created content.
According to Katzenberg, this is the same as comparing apples and submarines. He also cited Netflix as an example and asked for a reminder of how it looked in the first 30 days of launch.