Quibi cites low subscription numbers.
You have seen the internet ads and the riveting trailers, but the promising success of entertainment streaming service Quibi won't be able to keep up with their promise of a one-of-a-kind mobile streaming service. Just shy of six months after going live, Quibi is shutting down.
Quibi Holdings LLC confirmed to the Wall Street Journal that the company would no longer plan to operate because of low subscription numbers and competition from leading streaming services. Founder Jeffrey Katzenberg who once was a chairman at Walt Disney Studios and held other notable roles in the production industry shared the following during his announcement regarding Quibi's shutdown:
"We feel that we've exhausted all our options. As a result, we have reluctantly come to the difficult decision to wind down the business, return cash to our shareholders, and say goodbye to our colleagues with grace."
While the company had an impressive celeb lineup that included star-studded shows and short films, it failed to meet demands that the company anticipated during the pandemic.
Quibi will shut down, all employees will be laid off and it will explore selling rights to some of its content, people familiar with the matter said https://t.co/5o8IoNCnXx— The Wall Street Journal (@WSJ) October 21, 2020
Quibi blames the shutdown on poor timing and an "idea that wasn't strong enough to justify a standalone streaming service," but other analysts speculate that the competition was just too much for Quibi to handle. Free and unlimited streaming services, including Tik-Tok and YouTube, were no match for the paid subscriptions Quibi offered.
The company launched in early April after founder and CEO Meg Whitman raised nearly $1.75 billion. The company offered two streaming service plans. There was a streaming plan with ads for $4.99 per month and an ad-free streaming plan for $7.99 a month. While the subscription plans were significantly cheaper than other platforms, including Netflix and Hulu, the downside seemed to be Quibi's vision of being the elite mobile device streaming service. The lack of adequate subscribers to keep the company running proved that the demand just was not there.
What do you think? Do you or did you subscribe to Quibi? Tell us in the comments!