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Why is Quibi shutting down? Streaming site blows up $2B Hollywood money: 'had A-list celebs but still flopped'

Quibi is an app that presents fresh content from today’s biggest stars by delivering it only on your phone. It airs content in short 10-minute capsule-like chapters for some of the most hit shows

Quibi, the entertainment streaming app that staked its future on short videos, is closing down just six months after it launched in April 2020, the company announced on Wednesday, October 21. Quibi made content in short 10-minute video format for mobile users and brought up some great Hollywood shows in high quality to stream. It stated the decision to shut down in a long statement. 

“We started with the idea to create the next generation of storytelling and because of you, we were able to create and deliver the best version of what we imagined Quibi to be. So it is with an incredibly heavy heart that today we are announcing that we are winding down the business and looking to sell its content and technology assets” wrote co-founders Jeffrey Katzenberg and Meg Whitman in an open letter.

The reason for its shut down is that the company is struggling since its launch during the pandemic. It has exhausted all options, the letter says. “Our failure was not for lack of trying; we’ve considered and exhausted every option available to us.” 

The company will be reportedly paying to biggest streamers like Disney, NBCUniversal, Viacom, Sony Pictures Entertainment, WarnerMedia, Lionsgate, MGM, ITV and Entertainment One. All these giants have reportedly invested nearly $2 billion money into the app which is closing now. Here’s a look at the funding of Quibi and what it offered.

What is Quibi

Quibi is an app that presents fresh content from today’s biggest stars by delivering it only on your phone screen and not on any other platform. It airs content in short 10-minute capsule-like chapters for some of the most hit shows. According to CNN Business, it charged $4.99 a month with ads and $7.99 a month without to stream content that ranged from scripted, fictional series to news and sports highlights. 

The open letter stated the goal behind Quibi. “Our goal when we launched Quibi was to create a new category of short-form entertainment for mobile devices. Although the circumstances were not right for Quibi to succeed as a standalone company, our team achieved much of what we set out to accomplish, and we are tremendously proud of the award-winning and innovative work that we have produced, both in terms of original content and the underlying technology platform.” 

The site reported that Quibi has also brought in a lot of A-list talent featuring or making shows for the app. This includes Steven Spielberg, Oscar-winning director Guillermo del Toro, actress Anna Kendrick, television personality Tyra Banks, actress Sophie Turner, actor Liam Hemsworth and many others. As the news of Quibi shutting down landed, reactions on the Internet started pouring in. 
 
 A user could not believe the news, “Damn. I can’t believe Quibi is shutting down. Not only was the concept flawless, but they had an unparalleled understanding of storytelling. (This is a real photo from their office. I wish I’d written it myself.)”

Writer Josh Gondelman said, “Now that Quibi is gone, who will produce my short-form series ‘The Marvelous Mrs Rahzel,’ which tells the tale of a groundbreaking female beatboxer?” A user wrote on the news of Quibi being unable to tap into the interest of the public, “Quibi had A-list celebs promoting that app and still flopped.”

A user quipped, “Quibi is what happens when you tell a man he can do anything.” Journalist Derek Mead wrote on the finances of Quibi, “I feel for all the people who are going to have to find jobs thanks to Katzenberg's stubborn hubris.” He added, “to share very rough napkin math thought, if you were to guesstimate a strong midsized (50-70 person) newsgathering operation costs about $10mm a year to operate all-in, Quibi's $1.75 billion would last until the year 2195, rather than six months.”