Quibi is showing up in my conversations as an active buyer that is outbidding legacy networks.
The ‘Quibi’ brand name does not refer to a Vietnamese appetizer: It is short for ‘quick bites.’
Funded by Disney, Alibaba, Comcast and others, it is a video streaming venture run by corporate heavyweights Meg Whitman (CEO) and Jeffrey Katzenberg (founder and chairman.)
- By the end of its Year 1, Quibi plans to create 5,000 x 10+ minute original programs.
- The short-form content is formatted for mobile and online platforms where traditional 30-minute and longer formats are not as compatible.
- The great majority of the $1 billion spend is for scripted programs provided by leading Hollywood talent.
- Lifestyle, Reality and documentary content are in the mix.
Here is a link to a compelling Bloomberg video interview with both Katzenberg and Whitman.
Meg and Jeffrey, May I introduce Bill and Babe…
- Reading about Quibi, my mind wandered through the decades.
- One of my first assignments when I started work at CBS in the ‘Eighties was to help sell off programs created for CBS Cable.
- CBS was at the time the dominant “Tiffany Network.”
- CBS founder and chairman William S. Paley had decided to make a play as a cable network operator.
- Babe Paley, the much-loved and beautiful New York socialite and benefactor was said to have shaped her husband’s decision-making.
- CBS Cable was packed with original programs about the ‘lively arts’ and covered such topics as the ballet, grand opera, Broadway and more.
- Many of the productions were budgeted at broadcast standards rather than the costs afforded by a new distribution platform.
- Gaining little traction with cable operators but at enormous cost, CBS Cable closed in December 1982, after 14 months operation.
- There were few buyers for the archive.
- Only three years’ later, Discovery Channel launched with a different model;
- Buy very cheap
- Throw it against the wall
- See what sticks
- Invest in the winners.
- Discovery’s programmers soon found that sharks stuck. So did big, authentic characters, like Aussie naturalist Harry Butler.
- With the knowledge acquired from the audience response to low-cost acquisitions, programmers began investing in originals.
- By testing the programming and promotional elements that resonated with cable subscribers, Discovery soon became a giant among Unscripted networks.
- Discovery benefited from scarcity: It was the only factual-specialist channel during its launch days.
- Quibi is launching into a Wild, Wild West where consumers enjoy bazillions of video options that they can experience on dozens of devices.
- I learned this week at the Beet TV Conference that CNN counts 68 possible touch points with consumers, from old fashioned TV’s through mobiles to satellite radio.
- Quibi is investing heavily in originals without going through the testing phase.
- Most of Quibi’s fast-tracked original programs will not be home runs, or even base hits.
- And the occasional hit will not sustain a business that is dependent on originals.
A Lesson From China’s TikTok
- TikTok is an app that supplies super-short (10 seconds and up) videos of everything from make-up lessons and goofy dancing to football highlights, often set to music.
- It is mainly user-generated content in a mobile-friendly format.
- The TikTok app hit a viral nerve, rapidly passing more than 1 billion downloads worldwide.
- TikTok carried its parent company to a valuation of $75 billion, and is rapidly emerging as a challenger to Facebook.
- Read the NY Times’ coverage of TikTok here.
My Final Takeaway
- In the Wild, Wild West of digital and increasingly mobile video, the model that is the least likely to succeed is the one that tweaks the old studio and Cab / Sat model, borrowing established creative talent at relatively great expense, and all for a new short format that will be delivered across multiple platforms.
- Verizon lost more than $1.2 Billion on its abandoned Go90 platform — a similar top down fantasy from executives stuck in the pre-digital video era.
- Good luck, Quibi!
- And read more from top analyst Colin Dixon