Quibi collapses after just six months | Mobile | News | Rapid TV News
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Launched in April 2020 in a blaze publicity after months of build-up and hype, but disappointing almost immediately in terms of take-up, the Quibi millennial-focussed short-form premium mobile TV streaming service is to close down.
Quibi screenshot 7April2020
Founded by former Disney chairman Jeffrey Katzenberg and ex-HP and eBay CEO Meg Whitman, Quibi aimed to tap into the growing demand for mobile video offering a range of content covering scripted and original entertainment, sports and news, and boasted what were called a number of unique user experience features. Before launch the service inked deals with the likes of NBCUniversal, and its Spanish-speaking subsidiary Telemundo, The Weather Channel and ESPN and in March 2020 Quibi closed a second round of financing worth $750 million, bringing its total investment to $1.75 billion.

Yet for all of the investment, content and technology, Quibi always seemed to be battling against over-optimism amongst its founders and never received the mass uptake that had been promised. The company said its target was for over 7 million subscribers by the end of the year. Yet launching just as the Covid-19 pandemic was reaching its peak and with stay at home orders being implemented, only just more than 300,000 mobile users installed the Quibi app on launch day of 6 April in the service’s launch markets of the US and Canada. This compared with approximately 4 million installs seen by Disney+ in the US and Canada when it launched there on 12 November 2019.

Yet questions about whether Quibi would succeed were asked months before its launch. In January 2020 at the CES trade show, industry analysts wondered whether the offer would achieve its ambitions. In a research note, Strategy Analytics analyst Nitesh Patel said that Quibi was treading a fine line between potential success and failure. He asked: “Quibi is clearly a unique proposition compared to Netflix, Amazon Prime Video and other SVOD services...But will 10 minute episodic content format on a mobile device hook users and also bridge the divide between two needs, immersive entertainment and killing time?”

Such fears have now indeed been realised. In a letter to employees, investors, and partners announcing that the service was being shuttered – something they called “a profound apology” for “disappointing” and, ultimately for letting them down - Katzenberg and Whitman said bluntly that despite its investments, Quibi was “not succeeding.”

They said that this was likely for one of two reasons: “because the idea itself wasn’t strong enough to justify a standalone streaming service or because of our timing. Unfortunately, we will never know but we suspect it’s been a combination of the two.” The executives added that while the circumstances of launching during a pandemic was something they could have never imagined, other businesses have faced what they called “these unprecedented challenges” and have found their way through it unlike Quibi. “We were not able to do so,” they admitted.

Going forward, Quibi will now wind down the business and return cash to our shareholders. The shareholder letter noted that the company had a cash runway, estimated by media analysts to be in the region of $350 million, but this would leave a massive hole in the pockets of investors. Katzenberg and Whitman said that they were proud of the work that Quibi produced, both in terms of original content and the underlying technology platform, some of which was actually award-winning. They said that over the coming months they would be working hard to find buyers for its assets.