Despite having raised $2billion from investors including BBC Studios, Disney and Alibaba, with top talent like Steven Spielberg and Jennifer Lopez on board, just six months after launching during the #covid19 pandemic, in April, short video streaming service Quibi is shutting down after failing to attract subscribers.
On Wednesday, the company announced it was shutting down and informed employees that they would be laid off.
Quibi started out as an idea for short videos on mobile devices from former eBay CEO Meg Whitman and DreamWorks cofounder Jeffrey Katzenberg. According to Katzenberg, reasons for the failure was the coronavirus pandemic, also pointing out that the idea just wasn’t strong enough.
The company announced the news Wednesday:
“We started with the idea to create the next generation of storytelling and because of you, we were able to create and deliver the best version of what we imagined Quibi to be,” co-founders Jeffrey Katzenberg and Meg Whitman wrote in an open letter. “So it is with an incredibly heavy heart that today we are announcing that we are winding down the business and looking to sell its content and technology assets.”
“Quibi is not succeeding,” Katzenberg and Whitman explianed in the letter. “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. Unfortunately, we will never know but we suspect it’s been a combination of the two.”
Andrew Hare, senior vice president of research for consulting firm Magid, in a chat with CNN Business said:
“The fundamental problem the service was meant to solve (needing a new service for on-the-go, short-form, paid premium video) was proven fairly insignificant in 2020,”
Quibi kicked off to a slow start; Within a month of launching, it had roughly 1.3 million active users — as compared to 50 million and 183 million users Disney+ and Netflix had at the time, CNN reports.