It’s been said that to make it big in streaming video, you have to really want it. Yahoo! spent $2 billion on sports rights and failed. Verizon invested hundreds of millions into go90 and failed. The only ones who’ve found success thus far are heavyweight players who’ve poured eye watering amounts of money into content over several years, and it appears that Quibi is planning to do the same.
Quibi’s service will offer short form shows for mobile that have the production value of HBO-style content. Viewers will watch these “quick bites” while they’re on the subway, or waiting in line at Starbucks, apparently.
The Information released a story today revealing internal projections from the mobile video startup that saw it spending roughly $1.5 billion on content in 2020, despite having raised only $1.4 billion in funding so far. The company plans to have 175 programs comprising thousands of bite-sized episodes by the second year.
Quibi has high expectations for itself — Finding a group of investors to provide that money hasn’t been difficult, which isn’t surprising considering the pedigree of co-founders Jeffrey Katzenberg and Meg Whitman. What’s less obvious is the subscriber numbers they’re expecting to reach. According to the report, Quibi expects to hit 7.5 million subscribers in the U.S. one year after launch, and 16 million by the third year.
It’s a bold prediction for an odd idea entering a crowded market. The fundamental premise behind Quibi seems to be that millennials and gen-zers don’t have the attention span for longer video, or want to watch TV while they’re on the go. But the intense appetite for new shows from Amazon, Netflix and the like proves people want more, not less. And as The Information notes, at $4.99 for the ad-supported version and $7.99 for the premium option, Quibi isn’t even cheaper than competing options with longer content.
The company has signed all-star talent, however — All that funding is at least paying for some solid talent to produce content, including the likes of Steven Spielberg and Guillermo del Toro. Quibi is also introducing a unique “turnstile” storytelling format. Where Vessel, go90, and others failed was that they were asking consumers to pay monthly for content at the same quality as YouTube. Vessel literally offered subscribers early access to YouTube content.
If Quibi’s content is really good, it could potentially find success like Disney+, which killed it out of the gate thanks to its massive library of exclusive content. And people do watch lots of YouTube videos on their phones, so Quibi isn’t exactly wrong about that. Make it premium and ad-free, and there could be something there. Maybe.
And if it fails, thankfully the only people who will be hurt are a group of wealthy investors who can probably take the hit.