Quibi - The Billion Dollar Bet on Short-Form
Is Quibi set to revolutionise video content?
WndrCo, LLC was founded by Jeffrey Katzenberg following NBC Universal’s acquisition of DreamWorks Animation in 2016 where he was CEO.
WndrCo’s primary bet today has been on Quibi, Jeffrey Katzenberg's plan to create premium short-form content for mobile phones.
Quibi will target big name talent and production levels “to rival HBO and Netflix” with budgets as high as $100-150k p/min versus Facebook Watch budgets <$20k.
"It’s unbelievable how many hours we all spend watching great TV content today and, separately, how much time we are consuming short-form content… so why can’t those two worlds come together in what is a new creative and business alignment?"
Quibi, launching in 2020, is named for the “quick bites” of entertainment it intends to offer consumers daily on their smartphone.
Its proposition is to upscale the short-form market, capturing the all-important 18-35 year-old segment with a new level of production.
Distribution will be via the typical operating systems and devices (iOS, Android, Roku, Apple TV), and through what Quibi plan will to Telco distribution partnerships.
The planned offer currently has two tiers of service (similar to Hulu). Subscriptions will be the “main driver of revenue”, with a $5-per-month ad-supported tier and an $8-per-month ad-free option.
US Telcos are accustomed to bundling OTT services; AT&T has HBO, T-Mobile has Netflix and Sprint has Hulu, all free in unlimited tiers. It is here that Quibi is likely to live or die (they know this and are talking to the Telcos).
Katzenberg’s desire to marry the worlds of short-form and Premium is refreshing, but the ability to charge directly for short-form is a huge challenge that even their deep pockets might struggle to take on.
With all the major studios on board, the pulling power of Katzenberg and $1 billion, there is huge interest and undoubtedly the momentum to create a market. However, whether it will be sustainable is the bigger question.
The market for Short-Form
YouTube remains the dominant platform for short form, but the market for digital producers has been shifting with Facebook emerging as a strong number two and social media having the strategic rationale to invest. Other ventures have tried and failed to make standalone moves in to short-form, with mixed rationale and limited success.
Quibi has a growing team of highly experienced executives. With Meg Whitman as CEO and then a long list of people with experience in key sectors, including content (all areas), social media, short-form platforms, SVOD and related technology positions. Whitman and Katzenberg offer a powerful proposition (albeit they will probably not represent the best face of a business wanting to revolutionise TV for young adults) and it will be fascinating to follow.