An OTT platform has just been buried in the digital graveyard. What caused the melancholic demise of Quibi, the short-format OTT platform that was launched only six months ago? Perhaps, the explanation given in an open letter issued by the company encapsulates the reason behind its failure in an awfully premature manner. In the letter issued to announce the shutting down of the short-form streaming platform, founder Jeffrey Katzenberg and CEO Meg Whitman say: “And yet, Quibi is not succeeding. 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.”
Was the idea bad or was it the timing that needs to be blamed for its failure?
May be, the idea wasn’t just great. Quibi offered a “mobile-first premium storytelling.” The idea was to create a new category of short-form entertainment for people who were out and wanting to watch short videos on their mobile devices. But, short-form content wasn’t in short supply after all! People were already consuming short content in their phones. And then there are apps like TikTok. But, was there a ready market for big-budget fare that people have to pay for?
Quibi, a portmanteau of ‘quick’ and ‘bite,’ promised short-form videos that lasted ten minutes or less than that. The founders sought to target mostly millennials and Gen Z who are fed on a staple diet of short-form videos on their smart phones and people on the move.
They did their best. As the founder and CEO said in the letter, Quibi was a “big idea and there was no one who wanted to make a success of it more than we did. Our failure was not for lack of trying; we’ve considered and exhausted every option available to us.”
The streamer splurged on originals, producing a plethora of ten-minute-long shows, with big-ticket Hollywood talents such as Steven Spielberg, Jennifer Lopez, Idris Elba, Reese Witherspoon, Will Smith, etc. It even bagged ten Emmy nominations and two trophies. But, the short-form streaming platform failed to elicit the kind of response from the masses as was expected, despite opening the “door to the most creative and imaginative minds in Hollywood to innovate from script to screen.”
Mobile analytics company Sensor Tower found that Quibi had just around 72,000 paid subscribers after its 90-day trial period was over. That is an awful conversion rate of just eight percent. Which brings us to one plain but unpalatable fact: the less-than-expected appeal of Quibi. But a Quibi spokesperson challenged the Sensor Tower report, telling the Verge that “over 5.6 million people have downloaded the Quibi app.” Yet, Quibi has not published its total number of paid subscribers.
And then the timing. It was launched at an inopportune time, when the whole world was struggling to adjust to a new reality necessitated by a pandemic of unfathomable proportions. And the new reality means that people hardly venture out with work-from-home becoming the new norm. All of a sudden, Quibi found that its target audience, people on the move who would consume short-form content as they shuttle between homes and offices, wasn’t there. Stuck-at-home people, ironically, have time for more long-form content rather than short-form videos. People turned to TVs and other streamers like Netflix that offered movies.
The company has announced that it will return the $350 million capital to investors instead of letting more costs and debt piling up. The owners have also announced that over the coming months they will be “working hard to find buyers for these valuable assets who can leverage them to their full potential.