Well, word is out, and it seems this year’s CES darling was a lot of smoke and mirrors. A mere 6 months after launch, Quibi is shutting down. While we didn’t expect its demise to be quite that expeditious, our reaction to its ultimate misfortune is best summarized by a character we love on a different streaming service, the delicious diva Moira Rose.
The speculation has already begun – did Quibi fail because of the pandemic? Because it failed to pivot too soon? Because Founder Jeffrey Katzenberg and CEO Meg Whitman didn’t see eye to eye?
Maybe. But the truth is, Quibi was foundationally flawed from its inception. And without a massive pivot, it was never going to succeed.
In a letter to staff, partners, and investors, Katzenberg and Whitman wrote the following:
“Our goal when we launched Quibi was to create a new category of short form entertainment for mobile devices.”
There’s one major problem with this statement: their goal for Quibi was the wrong goal. Let’s break down why.
WAS THE FORMAT INNOVATIVE?
Short form video isn’t a new category of entertainment. There’s already huge existing market already for quick bite content. Facebook Watch, Instagram, YouTube, Snap, TikTok – all these services are full of snackable video (including clips from scripted shows), they’re free, and audiences are already using those apps. Plus, most of those apps allow you to be a creator or a viewer, take your pick.
DID PEOPLE WANT THIS FORMAT?
There is no evidence that audiences want short form premium scripted content at all, let alone exclusively on a mobile device where they can’t watch it on a big screen in all its HD glory. (To be fair, the Quibi app does allow you to cast from your mobile device to your TV through a connected device like a Chromecast. It does not have connected TV apps on devices like Roku.) In fact, there are signals that audiences don’t want this. Binge watching, to start. We’re not seeing that people love watching premium scripted content for a few minutes at a time, on the go. We’re seeing that they love watching for hours, in their living rooms.
WHAT DO THEY WANT INSTEAD?
Research we’ve conducted on mobile video indicates that people don’t want content on mobile, they want content to be mobile. That is, they want it wherever they are, on whatever device they’re using. It seems Quibi failed to learn this lesson from the demise of Go90. The pandemic exacerbated this as an issue, as people went in-home and to their TVs, but this was going to be a massive hurdle with or without a stay at home order.
(But wait, there’s more…)
WHAT HAPPENS WHEN YOU IGNORE THE PLAYBOOK?
Perhaps most curiously, Quibi failed to understand the launch strategies of any of their powerhouse subscription video predecessors, all of whom launched with an extensive historical library and then slowly built up an originals library on top of that. HBO. Showtime. Netflix. Hulu. Disney+. All these success stories launched with a massive library of known and beloved past titles, in some cases years before layering in originals. Challenge yourself to come up with an exception of a subscription video service that launched without a large library of older movies and/or TV shows. You can’t, can you? Exactly.
That’s not to say Quibi has no library – we did come across Reno 911, an old Comedy Central show that they chopped up into 7-minute segments. But a one-off here and there feels like a throwaway opportunity more than a rollout strategy rooted in rudimentary due diligence.
Katzenberg and Whitman go on to write:
“…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. Unfortunately, we will never know but we suspect it’s been a combination of the two.”
Except we do know. We always knew. Sure, launching a mobile-exclusive service in the middle of a stay-at-home pandemic was terrible timing. But the bottom line is this: the mobile exclusivity, the lack of adaptability, the lack of proper preparation, the absence of breakout hits – those were foundational issues that can’t be blamed on COVID-19.
The only surprising element of this news story is that with nearly $2B in funding, Quibi didn’t figure out how to adapt and pivot appropriately and expeditiously. And that makes this not a story of an ill-timed launch, but rather, a cautionary tale of what happens when audience priorities aren’t central to the goals of a business.