Quibi’s Failed Bets
By Frederic Filloux
Update on July 8, 2020 ⬇
Quibi reportedly lost 90 percent of early users after their free trials expired (The Verge)
- Quibi signed up about 910,000 users in its first few days back in April.
- Of those users, only about 72,000 stuck around after the three-month free trial, indicating the app had about an 8 percent conversion rate.
- That’s grim compared to Disney who managed to convert a comparable 11 percent of early free trials users, but that was of out of 9.5 million people signed up for Disney Plus in its first three days of availability in the US and Canada. Since then, Disney has added tens of millions more subscribers and now enjoys more than 50 million paying users as of April thanks in part to its international expansion.
- As a comparison, for similar demographics, TikTok is approaching 30m UVs in the US alone.
Other articles of interest:
• New York Mag: Is Anyone Watching Quibi?
• Forbes: The Fatal Miscalculation That Doomed Katzenberg And Whitman’s Streamer
• Protocol: Quibi hoped for 7.5 million subscribers in year one. An analyst says it’s at 72,000. Sensor Tower says that only 8% of the people who signed up for free trials have stuck around when it comes time to pay.
• NYTimes: Jeffrey Katzenberg Blames Pandemic for Quibi’s Rough Star
Quibi is the archetype of the overmarketed product, with almost scientifically calibrated contents. As a result, the scripts are dull, with no soul, no personality, and all the same. I subscribed to the trial period on day one, tried to watch a few shows before giving up. The bad timing is just part of the explanation. Its design is not connected to the social sphere, which was unforgiving. —FF
[The following published on Jan 26, 2020, in Monday Note #573] ⬇
Quibi’s Giant Bets
Quibi is the boldest venture Hollywood has seen in its recent history. It involves multiple breakthroughs in every area: narrative, production and the business model. Here is a breakdown of what Jeffrey Katzenberg is betting on.
Quibi’s concept is pretty simple: original content made exclusively for the smartphone. Films, documentaries, and news content will be sliced into “quick bites” — hence the name. Making this work will require a series of breakthroughs like the filmmaking sector has never seen before — and that the publishing industry should look at closely.
1. Format & narration techniques
Katzenberg claims to have had his epiphany after reading Dan Brown’s The Da Vinci Code and its one hundred-chapter structure, each of them written as a standalone segment of the narrative. This is the basis for Quibi: all aspects have to be designed from the ground up to fit Quibi’s rigorous requirements. From scriptwriting to production, to editing, all the workflow must be aimed at segmented consumption.
Three types of shows will be available on Quibi:
• Movies in chapters. 35 feature films will be produced this year alone. Each of them will be sliced into 7–10-minute episodes with one release per day.
• Unscripted documentaries: 120 shows per year.
• “Daily Essentials”, 25 curated and different 5–6 minutes news segments, mostly lifestyle, and entertainment. They are co-produced by companies like NBC, the BBC, ESPN, TMZ, and Telemundo. It includes the “Daily Chill”, Quibi’s version of late-night talk shows and even a meditation show shot in sound-immersive ASMR (check out this sleek Apple short if you don’t know what AMSR is).
Altogether, Quibi will release 175 shows totaling 8,500 episodes in its first year. Unlike Netflix, it won’t own its productions but will retain the full rights for the shows it commissions for just 7 years for the original version and just 2 years for the repackaged ones.
2. Unique production techniques
Filming for mobile doesn’t mean shooting on the cheap. It is the same for Netflix, which is equally demanding as it was aimed at the big screen. When filming The Irishman, Martin Scorsese used 35mm film in addition to a pair of digital cameras for special effects (such as aging the characters) for each of the 300 scenes.
Rodrigo Prieto, the cinematographer, was so obsessed with reconstructing the ambiance of each of the five decades of the story, that he managed to emulate Kodachrome reel to restore the color of the ’50s and Ektachrome for the ’60s and part of the ’70s. No one may notice, but such attention to detail is part of the particular flavor of the movie.
Not only will those who make films for Quibi not be allowed to cut corners on cinematography, but they are facing another daunting challenge, which is building a story that can be seen on both portrait and landscape viewing. The technology is called “Turnstyle”. It involves shooting with a special rig and basically making two versions of the same film. It must also involve the director, who will be the only one (along with the editor) to decide where the action is on each frame as they stitch everything together for the final cut. According to Quibi’s CTO, pan and scanning techniques and even machine learning techniques were unable to do the job. (I will come back to this issue of vertical vs portrait once the related patents are made available by the USPTO as I’m sure that some techniques can be interesting for journalistic storytelling).
Quibi intends also to use all the capabilities embedded in a smartphone, such as motion detection, and geolocation with respect to time and seasons. Taking advantage of it, Steven Spielberg will produce a scary show that will only be available once the sun is down and lock again at sunrise. We can expect more examples in which technology will impact storytelling.
3. The business side
Quibi is one of the most profusely funded startups ever: $1.4 billion. Lots of big names on board — Viacom, Sony Pictures, Warner Bros, Time Warner, MGM, Disney — thanks to the combined Rolodex of Katzenberg and Quibi’s CEO Meg Whitman. But The Information reported that Katzenberg had expected much bigger tickets from his Hollywood pals. It’s an undeniable sign of skepticism from the traditional movie industry that seems shared by Silicon Valley investors: none of them appears among Quibi’s funders.
But there is one big tech player involved in Quibi. Google has both YouTube and Android teams who seem closely involved in the technical aspects of the project, whether it is video production, distribution or smartphone technology (a huge challenge for Quibi as both landscape and portrait versions will be streamed simultaneously and the service is intended to be accessible on 3G networks). It is unclear why Apple passed on being part of Quibi. The main reason is most likely the demographics Quibi wants to pursue: while the ARPU of an iPhone user is much higher than on Android, Katzenberg and Meg Whitman are evidently willing to build a mainstream popular platform for the 25 to 35-year-olds using Android.
Quibi’s roadmap is rather ambitious. It expects to corral 7.5 million subscribers in the first year. It will have a dual pricing structure: $7.99 a month for the ad-free version and $4.99 for the mixed version, which puts Quibi on par with Apple+. As a comparison, Disney is priced at $6.99, and viewers currently spend on average $12.99 for Netflix’s most popular plan. Quibi bets that its format and its original programming will allow it to find a place between those giants as Americans get ready to sign up for on average 3.6 streaming services per household, according to a Wall Street Journal survey.
Even for ads, Quibi intends to make its mark. First by sparing the user an excessive ad load: while a broadcast network in the United States imposes 17 minutes of commercials per hour, Quibi doesn’t intend to go beyond 2.5 minutes. But it wants ads to be done its way: stories sliced into short bursts of 10–15 seconds. Quibi has signed $150m worth so far for its first year.
Quibi will debut on April 6. At that time, it will be the ninth horseman of the streaming war, and by far the boldest.
— frederic.filloux@mondaynote.com
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