Three months ago, the streaming service Quibi was launched with some fanfare and we devoted one of our posts to it (read Quibi, the new streaming platform for mobile devices). Its success so far has been quite limited. Its founders have blamed the pandemic for the app’s flop, but its problems may not stop here. Quibi—short for Quick Bites—is a streaming service that features 10-minute episodes of movies or shows for smartphones. The idea was to capitalize on the multiple breaks Internet users get during their working day. However, quarantines and lockdowns have changed those habits and made Quibi, if not irrelevant, definitely unnecessary. Still, not all Quibi’s problems end or start with the pandemic—with the rise of streaming wars, viewers demand the best content for the most affordable price. At this moment, Quibi offers neither.
In 2018, entertainment moguls Jeffrey Katzenberg, co-founder of DreamWorks Animation, and Meg Whitman, former eBay CEO, saw a market that did not have a premium service and decided to grab it. The market was short videos—YouTube style. No one was charging for them—they are mainly user-generated,—but they were driving ad dollars. With that in mind, Quibi was born. They were looking to serve the audience that watched 10-minute videos on their cellphones but lacked professionalized quality content. Katzenberg and Whitman raised 1.8 billion dollars from investors—mainly Hollywood studios and China’s Alibaba,—to attract talent and famous names for its shows.
Theoretically, the idea was sound. Mobile consumption was up, and daily commutes and short breaks offered the perfect target timing for Quibi’s content (read Mobile consumption is up…way up). However, the strategy has so far not delivered. As of July, the platform has 1.5 million registered users, many of whom enjoyed Quibi’s three-month free trial, as reported by Vulture. The app has also seen a fall in popularity. While on April 6, Quibi was No 3 in Apple’s App Store, it dropped to No 284 by mid-June. Reasons for Quibi’s short-term failure abound, with the main one being the pandemic, as Katzenberg told the New York Times. “I attribute everything that has gone wrong to coronavirus,” he said.
It’s true that with the pandemic, users’ habits have changed. Instead of rushing to the office with 30-minute commutes, viewers stay home and spend more time watching content. These past months, we have binge-watched dozens of shows for hours on end. Quarantines gave streaming platforms their chance to shine as users were spending more time and money on entertainment (read Entertainment in times of quarantine). But that means that we do not need the short clips as we have more than 10 or 15 minutes at a time to spend on a show.
Moreover, unemployment went up with families having to review their spending habits and pick one streaming platform. Quibi costs from $5 to $8 per month, depending on whether the viewer is willing to watch the shows with or without ads. It doesn’t sound expensive as other streaming services have similar costs. Netflix’s basic plan costs $9, HBO’s $15, Amazon Prime’s $13 per month, and Hulu’s $6 with ads. But Quibi is none of those platforms. Netflix, HBO, Amazon, and Hulu have won viewers’ hearts (and wallets) by offering quality content—shows that they could not watch anywhere else. HBO had Game of Thrones, Hulu had shows like The Handmaid’s Tale, while Amazon Prime had Marvelous Mrs. Maisel. Netflix has pretty much everything else. And Quibi? No one really knows what Quibi has.
And that’s Quibi’s second problem. Putting the pandemic aside, Quibi does not have one show that people would love to pay for. Its roster consists of short films, entertainment, or news shows that depend on the visibility of the famous people they feature—such as the mock reality show with the Kardashians’ mythical brother Kirby Jenner. As Vulture notes, Quibi has not marketed a single show on its own. Instead, it has preferred to advertise the platform as a whole. That seems to be a mistake—people pay for specific content.
Third, Quibi was launched as a phone-only service. Users could not watch its content on TV or on their laptops, which, during quarantine, made no sense. But the smartphone-only policy presented another issue—viewers increasingly like to share/comment on what they are watching on a second screen. In 2019, 70.1% of US adults scrolled online while watching television. Second-screen usage is on the rise, and viewers are not willing to give it up (read Second-screen usage, the perfect sales opportunity). Quibi has vouched to open its content to other devices, given the backlash.
Finally, Quibi has entered a cutthroat environment, almost believing they could dethrone the incumbents. But this has proven to be extremely hard. Netflix, HBO, Disney+ have all made their names, and all have a loyal following. Quibi has neither. It was a new platform that needed a hit for users to sign up. They haven’t been able to create one. Part of its mistake was to think that moving the content to phone-only would be innovative enough to disrupt the market. But, as results show, that is not a real disruption. It was just a change. In Quibi’s favor, we have to say that the app brought innovations in terms of production. The platform was ready to feature shows that would take advantage of a phone’s idiosyncrasy, making you feel inside the movie. For example, Katzenberg announced that Spielberg would make a scary show only watchable after dark, says Vulture.
But although it sounds innovative, it seems that those changes are more exciting for producers than for consumers, who want to watch good content. Quibi can turn around when it implements changes that adapt to users’ habits. But it must learn that it takes a lot to oust streaming royalty. And mostly, it takes excellent, unique, and very distinguishable content. A good roster is not enough; Quibi needs a gem that differentiates it from the free Instagram and Youtube rocks.