Quibi - Why It Failed

this video is sponsored by trends right now you can get your first two weeks for just one dollar simply go to trends dot co slash company man for your one dollar two week trial quibby now this is an interesting case i've actually seen plenty of people criticizing that name but i think it's great it's snappy memorable has a cool sound to it it's just fun to say in fact it seems the whole topic has become the cool new thing to make fun of a lot of it is justified though there is a lot to respect as well but yeah it's a pretty big failure i believe the quickest one that i've ever talked about on this channel it's looking like the entirety of the service will have lasted for seven months from april to december of 2020 in short quibby was a bold attempt to establish a brand new netflix-like streaming service with a pretty big twist to it the word quibby stands for quick bites because all of their content was less than 10 minutes long it was meant to be watched exclusively on your phone while you have some down time during your day if you're waiting for your next class to start commuting on a train standing in line somewhere or maybe you're in the dentist office in the waiting room you know those five to ten minute periods where you're looking around on instagram or reddit or whatever their hope was that you would instead fire up the quibby app and watch one of their many 10 minute shows or movies the ad supported plan costs 4.99 7.99 without the ad so i want to talk about some of the reasons quibby did seem promising and then attempt to figure out what went wrong first off the leadership the main people in charge over at quibby were their ceo meg whitman and their founder and chairman of the board jeffrey katzenberg two people with incredibly impressive resumes here for meg whitman she has degrees from both princeton and harvard most famously in 1998 she joined ebay as their president and ceo i mean she took over there when nobody knew who they were she led them through their ipo and by the time she left 10 years later they had become the multi-billion dollar company that we all know that's not even the end of it either from 2011 to 2018 she was the president and ceo of hewlett-packard now it has not been a flawless career but if you were starting a new company and looking for someone to lead it you could do a lot worse than meg whitman in quibby's case the founder was jeffrey katzenberg who is probably one of the biggest names in the entertainment industry he has served in increasingly bigger roles at paramount disney and dreamworks he was a big part in reviving disney's animation in the early 1990s he's known for producing all of these classic films around that time including aladdin beauty and the beast and the lion king from there he was one of the founding members of dreamworks alongside steven spielberg and david geffen if you ever watch that beginning thing with the boy fishing on the moon you'll see that skg well the k in that is him among many others he was behind shrek madagascar and kung fu panda in 2016 dreamworks animation was sold to comcast in a deal where he personally received an estimated 400 million dollars you have to admit that this appears to be a pretty solid pair you have meg whitman managing the business end and then jeffrey katzenberg on the creative end that could lead to something big which is actually what many of the investors were thinking a second reason you may think that quibby would be successful is the 1.75 billion dollars that they were able to raise sure it gave them the money to do stuff like spend 63 million dollars in advertising including expensive commercials that were aired during the super bowl and the oscars before the service was even available but that funding also involved all of these big names in the industry i mean everybody was on board with this they received money from disney warner sony viacom all of which obviously thought that there was potential for quibby since they had this money with all of these names attached they were able to attract some talent to make their shows some examples most dangerous game had liam hemsworth and christoph vaults chrissy's courthouse chrissy teigen their new punk show had chance the rapper they even had all of this stuff planned with big time writers directors and producers i'm just thinking back to how that six second time constraint on vine led to some crazy content that wouldn't otherwise exist well here the constraints of quibby led to some unique show formatting that otherwise wouldn't exist many of these creators actually welcomed that as a challenge another promising aspect was what they called their turnstile technology it was pretty cool it was this thing that allowed you to watch the shows on your phone either horizontally or vertically you could switch between the two and it would still cover the whole screen and the shows were made with that in mind and some of them did find some clever ways to utilize the feature for the show wireless it stands out because when you turned your phone vertical you would see what's going on on the character's phone like i said creating the types of content that would probably otherwise not exist now let me talk about why none of this turned out to be quite as good as it may have seemed first off looking at the talent they did have some of the biggest most respected names in the industry but they weren't getting their best stuff let me just put it this way if you had a script that you were trying to sell somewhere in hollywood and you had an offer from disney in an offer from quibby which one are you going to take you see what i'm getting at and by using that logic we can assume that a good deal of their content was passed on by the bigger studios so just because they had bigger names doesn't mean they had the best stuff possibly proven by the fact that over that short time they made dozens of shows and i wouldn't call a single one of them a breakout hit so all of that talent doesn't mean much if it doesn't lead to anything for their turn style technology the obvious criticism with that one is who wants to watch tv shows in portrait mode to me anyway it's more of a novelty that you mess around with for a few minutes and then pretty much forget about it there's also a lawsuit involving that that complicates things but i want to jump to that 1.75 billion dollars in funding because that will lead us to the biggest reason behind their failure i say that because believe it or not 1.75 billion dollars is not even close to being enough money here i'll explain i don't think i have to tell you that streaming services have become outrageously popular on the upside it's a market with seemingly unlimited potential but on the downside everybody already knows that sure you have what's become the classics like netflix hulu amazon but then you have all of these new ones from apple and disney and hbo every single one of these is backed by a massive company that continues to invest huge amounts of money into the service looking at netflix they're spending over 15 billion a year on content that includes the production of their own original content in addition to money that they pay other studios to show their titles and that's not even including the back catalog of stuff that they have produced over the past seven years talking about bad catalogs look at disney they have been building theirs for almost 100 years and they've been adding to it with multi-billion dollar acquisitions like marvel and pixar the fact is that every major streaming service is spending billions of dollars every year on content and most of them are adding that to an extensive library of content that they already own so i think anybody would agree that quibby over here with their 1.75 billion dollars in funding and no back catalog never even had a chance going up against all these others that would be like me challenging steph curry to a three-point shooting contest i could make my fair share of threes but it would only lead to disappointment but you know what quibby knew that so instead of jumping right into something that they couldn't win they kind of tried to walk around it i think a great example of this would be arby's see in the 1960s fast food was exploding in popularity it was the big new thing you had mcdonald's up at the top with their hamburgers and their franchising and a ton of other companies following their lead opening very similar restaurants the raffle brothers who started arby's realized how much competition there would be if they tried to sell hamburgers so instead they chose to avoid it and sell something a little different which of course was roast beef you see what i'm saying quibby tried to pull in arby's a sentence that i never thought i would say but try to imagine if the raffle brothers didn't know exactly what they were doing when it came to making roast beef sandwiches what i'm trying to say is the direction quibby tried to veer was obviously toward the younger demographic the fast-paced younger people who are more likely to watch stuff on their phone and use social media well i have good reason to believe that 64 year old meg whitman and 69 year old jeffrey katzenberg may have been a little out of touch when it came to their core demographic i say that for all these little oversights like not allowing screenshots which made it harder for people to talk about and promote quirby on social media but i have to ask has anyone ever paused something on netflix and then came back to watch it later that's simple enough right if you only have 10 minutes it doesn't have to be a 10 minute show i'll bet you can go ahead and start a 25-minute show and just finish it later for that reason their biggest gimmick the 10-minute shows the thing that they are named after didn't fully swerve away from any streaming service that you know has a pause button but then in that little swerve that they did make they ran right into another group that was competing for people's remaining time on their phone talking about youtube and snapchat and mobile games all of which are generally free and i would bet that if quibby were somehow able to work it out to where it was free they would have a good chance in fact when they first introduced it they offered this free 90-day free trial and it did pretty well during that time quibby debuted with 1.7 million downloads in their first week making them one of the most downloaded apps in all of the app stores but when those trials ended that's where things took a bad turn i've seen some reports that less than 10 percent of people who did a free trial converted to paying basically showing that people were willing to spend time on it just not for five dollars a month these two leaders of the company that i've been talking about put out this open letter where they say quibby 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 when they talk about timing they're referring to the pandemic which i would definitely say was another unfortunate aspect they launched the service in the beginning of april right when things were starting to close and people were staying at home when the intended purpose of it was so people could watch things during their commutes and their downtime which were altered i mean they were so confident in this out and about model that they didn't even make it watchable on televisions they did start introducing ways for people to do it through airplay and chromecast but it's pretty clear that they were planning for people to watch quibby when they were not at home but of course on the other end of that argument their launch in april still exceeded expectations meg whitman even appeared on tv during that time saying that they were unaffected by any of that but it didn't hurt us at all so it's hard to judge their timing probably wasn't beneficial but it was not the core of their issues my guess is that it probably just made everything happen a little faster let me know in the comments where did things go wrong for quibby why do you think that such a promising start ended in such an embarrassing failure was it the reasons that i talked about or were there more things beyond that also i'm curious do you have any personal experience with them were you part of the free trial were you one of the few that made that transition into paying five dollars or even eight dollars a month and if so what show stood out to you and would you say that any of them were actually worth paying for in the end i respect quibby for what they attempted i do think that they were off base with most of it and did very little that actually worked out but it was a bold experiment we ended up with some unique shows from it not to mention an interesting case study so any other thoughts you have about quibby leave them in the comments i'd like to hear what you have to say i'm going to take this chance to talk more about today's sponsor trends they are the ultimate knowledge hub from the hustle i recommend them to anybody who's looking to start a business invest somewhere or just wants to stay informed and learn about interesting stuff that's happening in business that's the biggest reason i use it to help make these videos i'm always trying to stay up to date on what's going on in different markets i recently came across this article on storage units of all things and it was so in-depth and so interesting that it stuck with me and i just keep coming back to it with trends you can join all of these communities where you can network and workshop ideas i recommend listening to some of the podcasts and checking out their newsletter there's just so much stuff here i just love learning about things like this and if that's the case for you you're going to want to check out trends and if you do it right now you can 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Channel: Company Man

Views: 822,919

Rating: 4.950501 out of 5

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Id: gCl3-IdYOHA

Length: 12min 56sec (776 seconds)

Published: Wed Nov 25 2020

Reddit Comments

[u/salmalight]

Alternate title: every single thing Quibi has done or paid for since 2019