The Rise and Fall of Quibi: A Cautionary Tale of Ambition and Poor Execution

Quibi was a streaming service that launched on April 6th, 2020, with high hopes and ambitions. However, despite its innovative approach to content creation, including the use of Turnstyle technology, which allowed users to easily navigate through multiple episodes of a show without having to wait for each episode to finish, the company's launch was marred by poor timing.

The service launched during a pandemic, when people were already stuck at home and looking for ways to pass the time. However, this also meant that there would be fewer people on public transportation, which could have helped Quibi's marketing efforts. Instead, the lack of understanding of what people wanted from their streaming services ultimately proved to be the company's downfall.

The team behind Quibi didn't know the habits of people on their phones, and they didn't understand what people were looking for in a streaming service. This lack of understanding made it difficult for the company to execute its strategy effectively. Good marketing can carry a crummy product, but bad marketing can kill a good one. And in this case, Quibi's marketing efforts failed to resonate with users.

Quibi was also entering a highly competitive streaming market, which is saturated with established players like Netflix, Hulu, and Amazon Prime. This made it difficult for the company to stand out from the crowd and attract subscribers. Despite its innovative approach to content creation, Quibi struggled to gain traction in this crowded marketplace.

In September, reports emerged that Quibi was looking for a buyer, and even approached Apple's SVP of Internet Services, Eddie Cue, but he wasn't interested. A few weeks later, Quibi announced apps for Apple TV, Fire TV, and Google TV, which solved one of the company's biggest problems: getting its content onto multiple platforms. However, this was short-lived, as just one day later, Quibi announced that it would be shutting down.

The service's Twitter pages were locked down, Facebook posts vanished, and Instagram accounts went dark. The app ceased to function, leaving users with nothing but a void where their favorite shows once resided. The company's main website and YouTube channel remained active, but the impact of Quibi's shutdown was still felt deeply by its subscribers.

In the end, Quibi managed to scrape together around 500,000 subscribers, a relatively small number considering the amount of money that had been invested in the company - a whopping $1.75 billion. Even if every subscriber paid $8 a month, which is a relatively modest fee, this would have brought in only $48 million in annual revenue, hardly enough to justify the costs of running the service.

Despite its failure, Quibi's demise serves as a cautionary tale for entrepreneurs and business leaders. Even with the best intentions and most innovative ideas, things can go wrong. But it's how you respond to those failures that truly matters. As any entrepreneur will tell you, you have to fail a bunch before you succeed.

Quibi's story is also reminiscent of other failed ventures in the tech industry, such as the Zune, which was a music streaming service that attempted to compete with Spotify and Apple Music. Despite its innovative approach, the Zune ultimately failed to gain traction, but it paved the way for services like Spotify, which have become household names.

As for Katzenberg's funding efforts, he reportedly asked his friend Sage for help in securing additional funding for Quibi. However, even with a major investor at the helm, Quibi was still unable to avoid its fate. It's clear that $1.75 billion is a significant amount of money, but it may not be enough to save a struggling company like Quibi.

If you liked this episode, you know what to do - thanks for sticking with me. Catch the crazy and pass it on.

"WEBVTTKind: captionsLanguage: en(electronic music)- Hey guys, how are you all doing?If you're new here, well,sorry about that.Anyway, if you're new here, welcome.My name is Krazy Ken.And today we're going tobe talking about Quibi.You've probably heard of it before,but you have no idea what it is.That's okay.I don't either.So I wanted to look into it more,and thanks to my buddy Sage,who helped me research this,I actually learned a lot.And I'd like to share that with you today.In the end, this venture ended up gettingover $1.75 billion invested into it.The actual number probablyis higher than thatbut it collapsed in only eight months.With all this power and money behind it.How did it die in less than a year?And also back to thebasics, what is Quibi?Those are all valid questions.So I want to help answer allof those and more, right now.Quibi was a mobile-only streaming service.The name is a portmanteau for quick bites.The service was operatedby Quibi Holdings.A privately held companyfounded in August, 2018,under the name New TV by MegWhitman and Jeffrey Katzenberg.Meg Whitman was a CEO at eBayoverseeing massive expansions,including the PayPal acquisition in 2002,and Skype in 2005.Yeah, you may owned Skype for awhile.I had no idea either.In 2008, she becameCEO of Hewlett Packard,and she resigned in 2017.Katzenberg on the other hand,is a story for a whole different day.But in short he's a big wigin the film and media worlds.He had leadership rolesat Paramount Picturesthe Walt Disney Company,and he co-founded Dreamworksalong with Stephen Spielberg,and David Geffen.So he's a big deal.Anyway, back to New TVit was time to raise the moolah.Disney, NBC Universal,Sony Pictures, Viacom CBS,WarnerMedia, and tons of other big namesinvested in New TV.And at this time,New TV raised about abillion dollars in funding.How did they raise so much?Because Katzenberg.The dude had one hell of a résumé.Could you imagine thatguy applying somewhere?I think you're a littleoverqualified to work at Pizza Hut.So the money was coming in.And in October, 2018,the venture was renamed to Quibi.And in June, 2019,the official launch date wasrevealed: April 6th, 2020.At CES 2020, Quibi wasdemoed to a bunch of people.I mean, that's a really big trade show.So good place to get more funding.At the end of their second wave,I think they got around, give or take,750 million more dollars.So add that on top of the billion,we're looking at about $1.75billion invested into Quibi.So that's the brief history.Now the jarring question, well,one of the drawing questions:what the hell is Quibi?I remember seeing tons ofads for this on Twitter.I guess the awareness was good.But I still didn't understand it.Here's the thing, you know,I'm not a marketing guru byany stretch of the imagination.But I do know that ifyou confuse, you lose.And maybe that was the big reasonwhy Quibi ended up losing.But anyway, that aside let's dive into what this thing actually is.Quibi is a short form,mobile-only streaming servicewith two pricing tiers:$4.99 a month with ads,and $7.99 a month without ads.So everybody and their hamsterhas a streaming service.How the heck was this different?It was different,because it focused on short-form content,in a Vine, or a TikTok-esque presentation,but with way higher production value.And generally no video wouldbe longer than 10 minutes.In some cases, a feature length filmwould be chopped up intomultiple chapters, for example.For video playback,Quibi used their own littletechnology called Turnstyle.And this was kind of the bigthing that differentiated itfrom other platforms.So you could watch the video vertically,but you can also rotatehorizontally into landscape,and the video would adapt.Sometimes different cameraangles would show up,the text would reformat.Sometimes certain thingswould have a completelydifferent experience.There was one show where youwatch it normally in landscape,but when you turn it into portrait,you actually see what's on themain characters phone screen.So there's some interestingthings you could dowith this concept.Now on a technicallevel, being a video guy,I think it's kind of cool,the Turnstyle technology.But in the end, is itsomething we really need?Do we really need a multi-aspect ratio,high production value,mobile-only streaming service?So that's a perfect segue towhat I want to discuss next.How did something with so many big namesand studios behind it,and with so much money,fail and shut down in only eight months?First off, shows.Loads of money were dumped into the shows,with big stars in them.Now to avoid any copyright issues,I'm gonna keep this partshort, and just simplify it.The shows didn't give usersenough of a reason to open the app.And that's tough.Even if the shows weregood, they're still new.And it takes time toget that momentum built.To make things worse, there was no backlogof already really provenand loved content.But one big reason you couldn'tmake that work well anywayis if you had a backlog of content,none of it would work withthe Turnstyle technology.Next, the lawsuit.Interactive multimedia company, Echo,sued Quibi over the Turnstyle technology,claiming infringement onintellectual property.To Quibi's luck,the preliminary injunctionmotion was actually denied.But the suit continues.According to an October,29th article on variety.com,Echo is seeking a $96.5million payout for damages.This isn't over yet, butI'll keep an eye on it.The next issue was the lack of sharing.So many things I end up discovering,are actually throughfriend recommendations,or through social media posts.And I'm just going to say it, memes.If stuff is buzzing on Twitter,and there's memes and jokes,that's organic advertising.And I have discovered manycool shows and other productsthrough people just sharing itorganically on social media.But with Quibi, you couldn'tscreenshot anything.So you couldn't share things easily,with pictures and visualsor video recording.Now later, they actually builtin a screenshot function.But I don't know how muchof an issue truly was.Yeah, it probably hurt a bit.But like every big app that streams video,block screenshots,at least on iOS, iPad, iOS and Mac iOS.You can't take screenshots of Netflixor Hulu on any of those operating systems.So I'm not sure howbig of a deal this was.I feel like it was blownout of proportion a bit.But yeah, it was maybesome missed opportunity.Oh, well.Another issue was limited platforms.It was mobile only, but why?If it's mobile only,you miss out on all the peoplethat just want to kick backand relax and watch on theirTV or watch on their laptop.Like you miss out on all of that.Now later, they did integrateApple's AirPlay technology,and Google's Chromecast technology,so you could stream the videos to your TV.But then you would miss outon the Turnstyle technologywhich was the key uniquefeature that Quibi offered.So overall it's just bad by design.This next issue is debatable,but I'm going to mention it anyway.The bad launch timing.Quibi launched on April 6th, 2020.But at that time,Pandemic Incorporated was gearing upto launch version 19 oftheir infamous COVID product.Okay.Jokes aside.Yes, it did launch during a pandemic.So there's gonna be lesspeople standing in line.There's going to be less peopleon buses and trains andin public transport.That maybe hurt Quibi a bit.It maybe would havelasted a few more months,but it still would have perished.The biggest issue was,they just didn't know what people needed.The people running thisdidn't know the habitsof people on their phones.They didn't know what people wanted.It's hard to do, I'm not gonna lie.I've worked with marketing people a bunch.Marketing is hard.But it is what willmake or break a product.Good marketing willcarry a crummy product.But at the same time,bad marketing will kill a good product.And on top of that,they were entering alreadya very competitive streamingmarket that's very saturated.So Quibi was in a tough spot.What happened next?In September, reports showedQuibi was looking for a buyer.They even approachedApple's SVP of InternetServices, Eddie Cue,but he wasn't interested.And a few weeks later,Quibi announced appsfor Apple TV, Fire TV, and Google TV,which solves one of theproblems we mentioned earlier.But then literally one day later,can we be published in openletter announcing the shutdown.The service would remainopen until December 1st.Everyone was about to belaid off from the company.And it was reportedthat Katzenberg asked everyoneto listen to Get up Again from Trollsto help lift their spirits.I don't know what their severance pay was,but I I just hope they gotsomething a little morethan a little music clip.I hope.Then the fateful day came, December 1st.Quibi's Twitter pages locked down,the Facebook post vanished.The Instagram posts are gone.The app ceased to work.However, their main website,and YouTube channel,are still up.As for the shows. I don'tknow where they're gonna go.I'm sure we'll see them pop up somewhere.In fact, Public Figures alreadygot picked up by HBO Max.So that's one.In the end, Quibi died withabout 500,000 subscribers,probably a little more than that.And they actually had alot of five-star ratingsin the app stores.So maybe the app itself wasn't that bad.500,000 subscribers is more than I haveon my YouTube channel right now anyway,so hey, that sounds great.But in the grand scheme ofthings, that number is dwarfedby how much money wasinvested into this company.Even if every subscriber paid $8 a monththat's only $48 million grossannually, which is nothing,compared to the near $1.75billion of investment.So even though this idea didn't work out,I won't be surprised ifwe see something like itin five to 10 years andpeople are gonna go like,oh my gosh, Quibi did that.They were trying to do that.Like it's gonna happen.Give it some time.I always think about theZune, and the Zune Pass.The concept for partof it was pretty cool.You pay a monthly chargeto subscribe to music.It didn't work out back then.But nowadays tens of millionsof people subscribe monthlyto music services.So not everything works out.Any entrepreneur will tell you,that in order to succeed,you have to fail a bunch.Even if you have the money,and the reputation ofsomeone like Katzenberg,you're still bound to make a mistake,or just be too ambitious,and it doesn't work out.I applaud the team fortrying something at least.So thanks again to my buddy Sagefor helping me research this episode.If you'd like to check outhis tech and gaming channel,you can do so here.And if you've used Quibi beforeeven if you haven't used Quibi beforeI just want to know your thoughts.Feel free to write themin the comments below.And if you want to help fund the futureof the Computer Clan,plus get some awesome perks along the way.Feel free to pledge on my Patreon.Thanks in advance for your support.I asked Katzenberg for somefunding, but he said no.it was only $1.75 billion.I mean, pocket change.And Hey, if you liked thisepisode, you know what to do.Thanks for sticking with me.Catch the crazy and pass it on.(electronic music)\n"