Quibi is framing its release as a watershed moment in the history of video content. Once released, it will be the first dedicated short-form video platform that produces Hollywood-calibre content. This puts it in direct competition with the streaming giants. However, it is difficult to see how Quibi will succeed in displacing either premium long-form or free short-form content.
Switching from free content to payment will be an issue
Despite Quibi founder Jeffrey Katzenberg’s claim that it does not compete with the likes of Netflix, it is clear that Quibi’s viewers must come from somewhere. Also it is unlikely that they will all be first time subscribers to a streaming service. With a price of up to $8 per month, it is more expensive than Disney+. However, currently all short-form video platforms are free to use. One has to question why current users of short-form video would suddenly pay $8 a month for a service they currently get for free. We expect that if this venture is to succeed, a large proportion of Quibi customers will be current subscribers to a premium long-form streaming platform.
Aside from some YouTube content, the short-form world has never really competed with long-form video. Vine and, later, TikTok focused on quick bites of user-generated content. This was usually with the intention of going viral rather than fitting into a larger series for continuous viewing. Quibi is trying to break this mold by introducing premium, short-form, mobile content. It has already signed up several A-list stars, including Zac Efron and Idris Elba, with content costing up to $125,000 per minute. This is equivalent to prestige TV shows such as Game of Thrones. The investment shows Quibi’s desire to succeed in the market, but desire is by no means a guarantee of success.
Bite sized episodes may be a problem for Quibi
The app will feature ‘lighthouse’ content. Basically, movies split into several chapters, each lasting a few minutes that are released weekly. Quibi is betting on the huge social-media potential of this content, with excitement about each chapter generating buzz for the app. However, this approach poses several problems. Video consumers like to binge. We believe that it is unlikely that people will have the patience to watch 12 ten minute movie clips over the course of three months. Quibi counters this concern with a promise to release movies in their entirety once the series completes. However, this ultimately makes it a traditional streaming service.
Why pay for free news?
Quibi will also have a ‘daily essentials’ section comprised of news features. This will build on a key news bites theme. Other companies, including Twitter and Facebook already run these services, and will be included in NBC’s upcoming Peacock service. But most of this rival content is free. For Quibi to succeed in this area, they must produce higher quality product and a far superior interface. Despite much talk about the interface, and especially the ‘Turnstyle’ rotating technology, it looks unlikely that this will be able to prize users away from Netflix, or get them to pay for its content.
While Quibi offers something different, it may have overestimated its ability to draw customers from other premium service providers or free, short-form platforms. Its best bet is to create a new segment built around its unique content. However, with consumers increasingly stretched across several streaming and social media platforms, it seems a difficult prospect to convince them to indulge in a new segment of an already crowded market.