The outlook doesn’t look that good for Jeffrey Katzenberg and Meg Whitman’s struggling startup Quibi according to a lengthy report in The Wall Street Journal.
Said piece goes into the in-fighting between Katzenberg and Whitman and reports that the short form video subscription service had been projecting that it would sign up 7.4 million subscribers in its first year of operation. Instead, at the service’s current pace, it is estimated it will not even reach 2 million paying subscribers by that point.
Quibi’s app download peaked at 379,000 on its April 6th launch day, and have not exceeded 20,000 on any day in the first week of June according to analytics firm Sensor Tower. From April 6th to May 28th the app had been downloaded about 4 million times – of those just 30% are daily active users.
Another test comes next month as the service’s 90-day free offer starts to run out and so people will have to pay for the service if they want to continue it. For now the revival of “Reno 911!” has been the most popular show on the service, but reviews for shows on Quibi have been decidedly mixed.
Katzenberg has previously blamed the app’s poor showing on the COVID-19 outbreak, though haven’t spoken of other issues like the lack of ability to watch its content on TVs until the last few weeks in which Airplay and Chromecast functionality was finally added.
There has also been other problems – Quibi’s head of brand and content marketing exited just two weeks after launch, advertisers have reportedly sought to re-negotiate and dial down their spending commitments, execs on the service are taking a 10% salary cut, and Quibi is being sued by interactive-video startup Eko over their Turnstyle feature.
Though it raised about $1.75 billion in funding, with its cash burn rate Quibi expects it will need an additional $200 million by the second half of 2021. The piece also indicated that Katzenberg originally wanted to call it ‘Omakase’ which is a chef-selected sushi restaurant order, until Whitman pushed back.
Head over to The Wall Street Journal for the full report.
