Short-form entertainment service Quibi closes six month after it launched

By Emmanuel Legrand

The founders of short-form content platform Quibi have decided to cut their losses and have shut down the service, just six month after its launch. Hollywood executive Jeffrey Katzenberg and former HP CEO Meg Whitman, the co-founders of the service, announced the decision in a letter to "employees, investors, and partners who believed in Quibi and made this business possible."

  They wrote: "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. While the result was not what any of us wanted, we did accomplish a number of things and we are very proud of what the talented Quibi team has built with the blood, sweat, and tears that they poured into this business over these past two years."

A difficult decision

  Katzenberg and Whitman raised $1.75 million ahead of the launch in April 2020. Quibi projected over 7 million subscribers in its first year, but it only had about 500,000 subscribers paying $4.99 a month, as of a few weeks ago, according to CNBC. The company was not bleeding cash, but the co-founders decided to stop before they reached that point.

  “While we have enough capital to continue operating for a significant period of time, we made the difficult decision to wind down the business, return cash to our shareholders, and say goodbye to our talented colleagues with grace,” Whitman said. “We continue to believe that there is an attractive market for premium, short-form content. Over the coming months we will be working hard to find buyers for these valuable assets who can leverage them to their full potential.”

Launching during a pandemic

  They added in their letter that Quibi was not succeeding "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 circumstances of launching during a pandemic is something we could have never imagined but other businesses have faced these unprecedented challenges and have found their way through it. We were not able to do so."

  The service promised entertainment and news content packaged in 10-minute maximum, reflecting the era. However, even with the appeal of personalities such as Chrissy Teigen and Idris Elba, not enough subscribers found the content compelling enough to justify the subscription.

  Investors in Quibi included Disney, Comcast’s NBCUniversal, and AT&T’s WarnerMedia.