Quibi reportedly lost 90 percent of early users after their free trials expired
theverge.com
theverge.com
Comparing them to Disney is ridiculous too, it’s Disney! With multiple generations obsessed with their library and people literally counting down the days until their launch, they got a 10% conversion... but 8% is horrible and the end of Quibi?
I feel like this conversion rate thing really "depends".
Luckily they send those emails to you that remind you that you’re about to start getting charged.
it's also interesting to note that the only way to get a quibi subscription is via the two major app stores, which both take a 30% cut. So unlike netflix, apple, disney, etc who all allow purchasing via lower-fee methods, quibi is paying 30% for every subscriber.
https://www.vulture.com/2020/07/is-anyone-watching-quibi.htm...
> As of early July, over 5 million phones had downloaded the Quibi app. Of those, 1.5 million had registered to use it, and this was with Quibi offering a three-month free trial and doing saturation marketing. (When it paused the marketing during the Black Lives Matter protests, Quibi’s App Store ranking fell to No. 1,477.) In light of its disappointing user numbers, Quibi’s advertisers have reportedly asked to renegotiate their deals. The company was forced to go into capital-conservation mode. Executives took a 10 percent pay cut.
Also, 8% does not sound like a good conversion rate for the entertainment industry, even ignoring the disparity between subscription revenue and the hundreds of millions already spent for content:
> *Meanwhile, the 90-day free trials will begin expiring this month. The industry conversion rate from a free trial to a paid subscription hovers below 33 percent. According to research firm Parks Associates, if that holds true for Quibi, it could mean less than 500,000 people would be watching a network that spent hundreds of millions of dollars on brand-new premium content.
However it is fair to hate on the founder jeffrey shrekzenburg. I know some folks who work at quibi and say this dude is insufferable. Probably not as insane, but stephen wolfram levels of dooshbaggery. Dictator type who thinks is shit is golden. Turns out he made a 1.5 billion dollar piece of shit and from what i hear, he has finally accepted that maybe he isnt the greatest thing ever.
Also if you like shrek, he made shrek/dreamworks. And short little farquad is basically jaffrey katzenburg from what i've heard
Edit - some cursory googling suggests free trial to paid conversion for subscription services are generally somewhere in the 10-25% range. So I don’t think 8% is good, maybe mediocre. Note this is distinguished from lower rates associated with freemium model products(e.g., spotify). Will try to dig up some better refs to link out to.
However a few things, the general industry perspective went like this:
1. David Katzenberg and Meg Whitman were creating a consumer service targeting a demographic they don't fit in a field they've not worked in. (Consumer apps for a younger demographic)
2. They got 1.8 Billion in funding. For fuck's sake you should get one breakout hit piece of content from that. (Note Apple is struggling a bit with this one too). With the funding, hype and content they've spent on the expectations are going to be pretty damn astronomical, they brought high expectations on themselves.
3. Their entire premise was based on this concept of quick bites of content. With an almost 2 billion dollar war chest the right thing to do would have been to test this theory maybe? Roll out a single show first, backfilled with some news? Get some feedback maybe?
Quibi is led by some serious heavy hitters, so its not spoken much out loud but I think a lot of folks in the industry felt this play was based mostly on hubris and now there's a certain sense of schadenfreude as they start to flail.
It doesn’t work like that. A lot of the networks’s and Netflix’s breakout shows were not planned to be great. That’s why they just greenlight a bunch of random pilots and see what sticks to the wall.
It’s extremely hard to create hits.
That might be true for a lot of breakout shows, but not all of them. House of Cards was arguably Netflix' first breakout show, and Netflix outbid other networks for House of Cards when they were just starting to focus on original programming. That was always painted in showbiz media as a very deliberate plan based on Netflix' data about their users' preferences.
Startup Savvy CEOs have 2, maybe 3 successful companies under their belt, so it's harder to judge how much of their success is due to repeatable factors.
To succeed in short video they needed something that was beyond a bombshell, something desperately sought after but not forthcoming. Highly polished DeepFake Beatles concerts, with new music written by Paul McCartney. I don't see how you succeed charging for something that qualitatively better than YouTibe. You'd have to at least have new interactive elements (choose your own adventure? I don't know, but something cool).
Apple is making a series out of Isaac Asimov's Foundation books. [0] :-D
The foundation is great, but its not your traditional laser-battle big budget mainstrean action-sf thingy.
[1] https://www.goodreads.com/book/show/40881567-the-last-astron...
“Feeling” about a show, and connections to the people running are the two major factors driving those decisions.
Data driven shows tend to be forgettable and ignored by newer generations, who are the ones holding their parents’s credit cards, and therefore, a major audience for hit shows.
We're not so different from those 1000 monkeys writing shakespeare :)
Wait till you see what Disney is offering... you are going to cancel Prime.
I’m not disputing either of your presented facts, per se, but the first of those is absolutely not implied by the second.
There's a great interview with Bryan Cranston, where he's talking about the origins of "Breaking Bad."
Basically AMC wanted to compete with HBO, but they didn't have HBO money. So they gave the creators a limited budget but a lot more creative freedom. AMC basically created an environment where creative people who had a passion project could get it off the ground if they were willing to work for less money.
In particular, Vince Gilligan had to go to the mat for Bryan Cranston, because AMC wanted Gilligan to cast someone else.
It very well could be that their shortage of content wouldn't have been as big of a deal because their ideal users weren't binging on their stuff, just watching while on a train or lunch break.
I'm not saying they haven't made mistakes, but it does feel like this aspect is missing in a lot of the bandwagon criticisms of the service.
The problem is that the short time bursts are highly variable, but they specifically target 10 minutes. That's why people scroll through twitter or instagram, it fills the void, no matter how long it is.
And, yes, I know it sounds kind of bizarre to ridicule a ten-minute short as “too long”. Fortunately, the public is (still, for now) absolutely willing to watch productions that take a bigger time and attention investment. It’s just, they want to watch it at home, possibly with others, on a bigscreen. Quibi deliberately avoided that with the “mobile only” constraint that they’re now reversing.
Edit: sorry for overusing “still”.
Who else has: * 10 minute+ but less than 22-30 minute "full TV show" long uninterrupted breaks * Where their phone is the primary connectivity device * Predictably available?
If I'm at home, I have the PC, the TV, any number of better ways to enjoy content. If I'm in a car I'm driving, I can't watch video. If I'm on the toilet or a lunch break, I may not have 10 uninterrupted minutes.
I wonder if in 20 years, we'll see it on self-driving cars as a similar fit. "Your estimated trip time is 17 minutes, here are some recommendations of programming for the dashboard screen."
You are really telling me that people are too busy watching 2 hour documentaries or reading books to load up Quibi for a quick hit? I don't buy this at all. We don't still have lunch breaks?
I know this is kind of the "insider narrative" on this (I actually bought my house from someone fairly high up that relocated to the west coast to work there) but this really rings hollow. After reading some of Katzenburg's comments in an article a few months ago where he said "I blame everything that has gone wrong on Coronavirus. Everything." This is not a successful approach to thinking about why your product isn't getting the market fit you thought it would. Then throw in some highly annoyed comments when it was retorted that Tik Tok is thriving with "its comparing apples to submarines." With thinking like that I don't think they stand a chance really.
Personally I can not imagine a better time to launch a video platform than the onset of a pandemic where people are stuck inside with little else to do aside from consume content.
Even then, adjusting to the new reality and repackaging 10 minute episodes of a show into 30-60 minute episodes could likely be done in an editors suite in a few weeks.
Agreed. "Dr. Horrible's Sing-Along Blog" anyone?
I've enjoyed some short-form episodic content on Amazon before, but it always left me feeling short-changed, and wishing the episodes were 30 minutes. It was too quick to go through the entire series and then it's done, I have to search for more content that is high quality, which is few and far between. Maybe it's for people with ADD who can't follow a plot longer than 10 minutes long?
Quibi is relying on a gimmick, and one that isn't even difficult to copy and has been done before. I've so far not heard of any reason that would compel me to spend my time on their site when there's so much other content out there.
I'm also not sure why anyone would want Meg Whitman on board at a company like this, unless she's somehow responsible for bringing some of that 1.8 Billion in funding, and even then she should only be on the board, not in the C suite.
For 3, what would you envision for this test, other than normal market research / focus groups that they likely conducted? Surely you shouldn't launch the Quibi brand with just one show if the goal is a full-fledged streaming platform.
I worked at HPE, when Whitman was CEO.
The impression I got, was that she's a bit of a wizard when it comes to finance.
For instance, the organization that I was a part of, we lost a pile of money. But despite that, HPE was able to sell the org off to SuSE.
IE, if Whitman wasn't a wizard, the entire venture may have been a 100% loss. But she was able to flip that organization to another buyer.
They are crashing and burning because they have fewer than 100k users after nearly 4 months and aside from piling a lot more money into advertising they have no momentum, no brand awareness, and no properties anyone outside a few people know.
> Comparing them to Disney is ridiculous too, it’s Disney!
It's not about 10% versus 8%, it's about 10s of millions of paying users versus 10s of thousands. Obviously Disney had a huge head start, that's the whole point. The two services cost the same amount, what attracts new users? Content. For my $7, I'm going to sign up for the service with content I know I'll like. That's the same choice millions of people made here.
For example, if Dave Chapelle signed an exclusive deal with Quibi, then all of a sudden those 92% that didn't want to come back will come back in droves.
Quibi isn't a lost cause, they set up the infrastructure and are just getting started on releasing content. Everything depends on if they can find their must-see-tv.
1.7 billion sounds like a lot but netflix spends more per year on programming only.
Netflix is getting $12.99 from me and it doesn't look like a bargain compared to Disney.
I guess the two things it boils down to is their place in the market, and who their customers are?
- I think Netflix speaks for itself. - Disney+/Hulu has the power of the catalog, generations of IP, and creatives to leverage it. - HBO is HBO if ATT can manage to keep it that way. - Amazon has quite a few good things going on imo, and it helps a lot that its just attached to prime.
So now with these players, we're very much at the point of marginal overload. Why do I want your service? What do you have that no one else does?
So I guess what I'm really interested in is who that 8% is? In what ways does Quibi work, because I already feel like I have an idea/opinion of how it doesn't work.
Friends and family maybe 1,000. Forgetful people not uninstalling after the trial probably 6000. Of those 1000 users probably varied. Some expect something. Some want every streaming service. Some want 10 minute videos. Some never unsubscribe.
Imagine what the Customer acquisition cost ($10-$20?), that means the customer conversion cost is $125-$250.
With a $5-$8 trial you can see how the economics of this simply do not work.
This is not a funnel experiment. This is a huge pile of people specifically seeking out a special event at a launch, so the composition and intent of that is expected to be way, way, way more favorable than general steady state.
It’s like if concert tickets went on sale and everyone is camping in tents to buy them on the first day, and then when the booth opens and people listen to the free sample, 90% of them just pack up and go home.
That’s a much, much worse situation than if only 1/10 people who see an ad for the album choose to buy it on iTunes, whole different ballgame, funnel composition, intent model, everything.
10% conversion on a massive launch promo is drastic failure. This is not at all like getting 10% conversion on a funnel with low intent.
The problem of all these platforms is that they think they are creating a new market or expanding an existing one and they forget that people only have 24 hours a day to do things.
If you create something like Quibi you're competing with Instagram, Snapchat, TikTok, YouTube, Netflix, Xbox/PlayStation/Nintendo-Switch, Mobile Games and anything else that is trying to grab a slice of you leisure time.
Why would I pay for this when I already pay for other options with more content and get a handful for free?
Quibi is what you get when you think you know your customers but you really don't. It's the type of self-deluded product that is created in an echo chamber by rich people who believe their past success is a formula that can be reproduced at any scale as long as money is involved. The problem with that idea is that it values scale more than ingenuity.
Doing short vertical videos with high production value and charging to watch them is almost an absolute zero in terms of innovation.
Make no mistake, short-form content can be a major entertainment source. Personally, I recently deleted Tiktok from my phone, more because of its power to eat up time when I ought to be sleeping than because of the recent privacy furore.
But I accept that launching it as a paid service was extremely risky. Better to start with something free and attention-getting.
Also you have staple names like NBC launching services in this space for free (Peacock).
The problem with Quibi is actually a ROI problem and that's why it doesn't work IMHO. If you raise north of 1 billion to build this you are confident that your revenue is going to be significant. I think that there's not a sizeable market for this type of content, in this current market at that price point.
As a reference point, Patreon has only paid $1 billion to creators since its inception. Granted, Patreon is still growing at an accelerated rate and the trajectory seems to indicate that there's a lot of room to keep growing for the foreseeable future, but you can see that if you were to map Patreon payouts to a potential Quibi revenue trajectory they are far from turning green.
I don't think that's a good parallel but just making that comparison since you mentioned that example.
I'm being semi-facetious here. I think "legacy media", particularly network broadcasters, are coasting off brand recognition earned in a bygone era that younger generations never experienced and never will. That's obviously not sustainable in the long run.
They also do have a major ace up their sleeve as the official American broadcaster of the Olympics.
It would take absolutely Katzenburg levels of hubris to think you knew what customers would be without testing it.
I fully expect Quibi to crash and burn under the weight of the content costs among other things, but is an 8% conversion rate bad for converting from free to paid? What's the appropriate benchmark for this kind of thing?
It may be if they based their financials (revenue, debt, and investment) on higher numbers.
And I agree, it seemed obvious that this was going to crash and burn very quickly.
For free trials where you don't provide billing info in advance (e.g. a lot of software 30-day trials) 8% would be a great rate. Because the default do-nothing action is nothing.
But for subscription services where you do provide billing info in advance, 8% retention is pretty terrible. If 92% of people are taking the effort to cancel, when the default is to let the subscription charge... it's definitely not great.
(I'm assuming Quibi required billing info in advance, like pretty much every other subscription content service does.)
* Worth noting, since you mention tech savvy individuals, that these are not tech savvy services (although buying a premium service from an app on your phone probably immediately skews you somewhat tech savvy).
> The industry conversion rate from a free trial to a paid subscription hovers below 33 percent
https://www.vulture.com/2020/07/is-anyone-watching-quibi.htm...
If I am only willing to kill 5-10 minutes on my phone, my investment in whatever it is ill be killing time on is very low. So I suspect it's going to be very difficult to convince these users to pay a monthly fee for a service when Snapchat offers a similar level of gratification for free.
They burned over $1B and it was a colossal failure -- apparently so forgettable that none of the coverage on Quibi even mentions it.
One major difference: go90 was a free service, and it was even zero-rated for Verizon Wireless customers (i.e. didn't count against subscriber data caps). Yet it remained a failure across several attempted pivots before Verizon threw in the towel completely.
What a truly bizarre tack if that's what they really though. A "30 minute" TV episode is actually about 20-21 minutes minus the ads, intro, and credits.
And then promptly went back to either reading stuff in Instapaper, or listening to podcasts, or playing Pokémon Go if we were moving at a slow enough speed.
That could be the other problem. The trial is long enough to finish watching the one thing on Quibi you downloaded it to watch.
The content is SO random that I can't imagine someone finds more than 1, maybe 2, things to watch that are to their liking.
Majority of gen Z / millennial folks that I know, don't care about Trevor Noah or any of the late night comedians. They care more about famous YouTubers and TikTok stars.
It sounds like they’re still interested in celebrities, it’s just a different set of people than older generations expect.
I wonder, is that gap new or just part of the cycles of life?
This doesn't suggest that no youtubers have staying power: Pewdiepie has been around for a while and has a massive subscriber count. But he is literally the best of the best, and my point is just that the staying power of a celeb is now more fluid all up and down the distribution of popularity.
Given that this is where there is just a separate group of people that understands or learns the selection criteria for YouTube/Twitter/TikTok/Twitch whatever and can have more synergy transferring between these outlets. It makes sense that someone who in another setting is popular just seems to land flat when they are having to relearn a new way of presenting themselves and the old tools don't work. Even celebrities that start a YouTube channel that I at least followed in passing end up feeling terrible, and I don't think I've seen a hollywood grade external star stick with their YouTube content long enough to actually start learning what needs to change.
People can’t keep up with everything as it is. There is a massive content bubble. I don't think Quibi or even most of Hollywood will survive.
But I suspect that "YouTube celebrities" are not something that platforms like Quibi can tap into. I'd say the whole phenomenon could easily be a symptom of which platforms kids (<18) have easy, free access to. Add in network effects - if a plurality of kids is watching and talking about some drama unfolding among elite YouTubers, it's very easy to turn that plurality into a majority.
Even though I fit the bill of watching YouTube rather than TV, I don't think Quibi would be successful by hiring "Dude Perfect" or whoever (just to pull the first name I recognized off the trending tab). Personally, I have about 50 subscriptions on YouTube, and the median channel has only ~330k subscribers. The biggest (Last Week Tonight) has less than 10 million. Taking me as an indicator of what millenials are doing would be the worst kind of anecdata, but I wouldn't be surprised to learn that a majority of people my age aren't following any of the so-called celebrities. What's a name that would pull me to a new platform? ... I can't come up with one, actually. And kids are on YouTube because it's free and easy to access - they're not potential Quibi subscribers either.
(Sorry for the long comment, yours was interesting and provoked some introspection.)
If quibi was actually interested in making stuff to suit millennial taste, they should have focused on absurdist comedy, which is usually short-form anyhow. Stuff like Eric Andre or Adult Swim's "Infomercials" series ("Too Many Cooks", "Unedited Footage of a Bear" + many others that vary from amazingly memorable and funny to unwatchably awful) is exactly the kinda of stuff that I wont invest over 20 minutes in (absurd humor tends to get boring when it loses it's novelty), but whenever I find one that's really good - I'll show it to all of my friends. Having a decent budget, cast and production quality also really makes a big difference with what can be accomplished, so random absurdist youtubers usually can't provide the same experience. The fact that the Reno 911 reboot is the only thing on quibi doing well sort of confirms that the "weird comedy" genre is still underutilized.
Edit: Apparently someone has already written about this trend far more eloquently than I did: https://www.theguardian.com/tv-and-radio/2019/aug/13/how-did...
That's personal preference obviously, and people are free to spend their time how they want, but I think the loss of attention span is a culture-scale problem now and excising these companies from our lives is a necessary treatment.
I hope Quibi folds permanently and we salt the earth where it stood.
Can't you just... ignore it?
Cut these things out of your life anyway?
Live and let live?
I never know what people are going to like so maybe it will become the next TikTok instead, or someone will make a new Quibi that I also won't use or understand :)
The rest of the content though... Pretty bad, at least to me. One daily show isn't enough to keep me around.
Anyone know of a solid, ~15 minute daily news report similar to what the BBC was offering on Quibi? Preferably something with a worldwide scope. I'd happily pay a fraction of Quibi's monthly fee for just that show.
I see SensorTower quoted a lot for mobile analytics, but their methods are completely opaque AFAIK. For all I know, one can “buy” good analytics by giving them some money, in order to promote an app.
Alternatively, nepotism could skew analytics: the CTO’s brother-in-law’s app gets higher usage and download ratings than a competitor.
How can we trust that such companies are honest?
It can't be good for individuals or our collective to consume all of our media in short, predigested clips (or posts, or comments). I genuinely believe that the average capacity for "long running" thoughts (and general idea complexity) is being eroded.
All of our media seems to be
Having an unknown service is bad enough, but they have no base to grow from. Disney+ is Disney. Apple TV+ has Apple behind them and is able to offer a free year with every iPhone. HBO, CBS, MLB, and even Hulu have big, well known brands with known content. Everyone in streaming started with a base or with at least free content.
It's not the 8% that's the issue here, it's the fact that they have fewer than a hundred thousand users and no momentum.
On one hand, Wirecard at least maintained the illusion that the money had not been disappearing, for years and years. They fooled auditors, regulators, and investors all over the world, again and again. That takes major cojones.
On the other hand, Quibi is managing to vaporize the money very quickly with Hollywood glamour and spectacle. If you're going to blow things up, there's something to be said for doing it with style. Peter Sellers would be proud of their unintentional "performance."
At least Wirecard did it intentionally.
I'd actually like a good alternative to Youtube, this could have been it.
It's incredibly annoying when you have to watch ads every time you queue an episode to download for offline viewing.
first, downloads do not mean payment or usage. you can download an app long before you use it.
second, as netflix confirmed years ago, 70%+ of sign-ups happen on TVs – probably even more during COVID – so app activity is not a meaningful lever of insights.
https://www.vox.com/2018/3/7/17094610/netflix-70-percent-tv-...
Sure there have been some great short story compilations, but paradoxically, the better they are the worse they feel. As you just get invested in a great story/world only to have it end a short time later.
That seems to be what people want, not network produced scripted tv made brief + vertical.
I think you just described TikTok.
YouTube and Twitch though seem to have some of the strongest "content creator" culture and are both still stuck in landscape videos and other sub-optimal phone UI.
But you're right, they're fucking up.
To me, Apple's content tends to be way too safe. It's boring. (Or, at least it was boring when I saw it.) If I want straight-down-the-middle-of-American-culture-type content, I already have Disney+ and way too many other choices. If they want to grab my attention, they need to take some risks and/or find their niches.
This is what I appreciate about the other major tech company with a me-too streaming service: Amazon. Prime Video is willing to take risks on weird genre stuff, and some of it is really good. I could never see Apple releasing something like Fleabag or The Boys. That perception is probably why Apple TV+ has been so forgettable. Boring has no place in Apple's branding.
The transition from a music store to a music streaming platform made sense. "Hey, you know the music that you could have bought so far? Well, now you can stream it."
Not so much for the movie/TV show business. "Hey, you know the TV shows and movies you could rent and buy? Well, fuck those, we have ten original titles that you should watch instead."
Apple TV+ doesn't feel like it builds on top of the experience and connections made with the movie/TV show renting/selling business. I just opened up the Apple TV application on my iPhone and the What to Watch list is rather sad. First one is USS Greyhound, which might actually be a decent watch. Next one is "Greatness Code", doesn't really look like my cup of tea, but probably it's probably not crap. In third there's "The Gentlemen" - oops, only available for purchase at 13.99 euro!
Take a look at Trying.
I watched the Morning Show on AppleTV+ and enjoyed it. I also watched the Homes series, which I really enjoyed. But, this is just a "free with iDevice purchase" kind of thing.
With most people no longer commuting and most forms of entertainment and recreation closed, a lot of people have fewer things competing for their time. I think many people are now spending their time on things that use up longer chunks of time: watching TV or movies, going outside, and hobbies.
Shape of Pasta is a cooking show about rare pasta types -- sometimes being made by only a single person in a village!
Run This City - A documentary about Jasiel Correia, the youngest mayor in Massachusetts who get's caught in numerous controversies.
Nightgowns follows Drag Queen Sasha Velour's Nightgowns tour, this program worked particularly well on the service.
There are a couple more shows that I live Dishmantled, Let's Roll, Singled Out.
The issue is that these shows had 7 - 10 episodes each. Most of Quibi's content is daily news programming. It honestly felt similar to the daily news shows I can get on Snapchat for free.
If Quibi had more shows like the non-daily news shows I think I would have stayed longer, but Quibi's content is mostly daily news.
To put it mildly: https://en.wikipedia.org/wiki/Jasiel_Correia
That's a positive number. If they had designed their business around 'the next 2 years' and not 'everyone will buy all of it right away' well then maybe they stood a chance.