Quibi, the short-form streaming service that launched this April, is shutting down, the Wall Street Journal reports. According to WSJ, the decision to shutter the company was made as a result of lower-than-expected viewership, a lawsuit, and a host of other issues. Founder Jeffrey Katzenberg and CEO Meg Whitman reportedly informed investors of their decision on a conference call Wednesday afternoon.
Quibi raised $1.75 billion from investors including Disney, NBCUniversal, Time Warner, Viacom, and Sony Pictures, and suffered a slow start as it failed to gain any traction in the following months. Though the company spent dozens of millions on promotion, Quibi was reportedly on track to sign up fewer than 2 million subscribers within its first year, which was just 30 percent of its original target. The platform, which cost $4.99 a month and differentiated itself from other streaming services by offering programs in 5-to-10 minute “chapters”, suffered from a lack of eye-catching content, despite the involvement of big names including Kevin Hart, Chrissy Teigen, Chance the Rapper, and Christoph Waltz.
Not only was the streaming market highly saturated when Quibi launched in April, but the service arrived just weeks after much of the U.S. had entered pandemic lockdown. With many viewers stuck at home, where they had access to other streaming services on their TVs, there was little demand for a largely mobile platform (the shows were formatted to fit smartphone screens), especially since it initially lacked many key features, such as taking a screenshot, sharing on social platforms, or casting its programming to televisions via AirPlay or Chromecast.
About 200 employees will lose their jobs as a result of Quibi’s closure, though the company will reportedly pay severence. The company is also currently in a legal dispute with interactive-video company Eko, which claims the tech rips off their own intellectual property.