Competing against YouTube “is an uphill battle for Quibi,” analyst Dan Ives tells TheWrap
Quibi, the new mobile-video streaming service that launched Monday to mixed reviews and a lackluster 300,000 downloads in its first 24 hours, will need more compelling content to make good on its massive $1.75 billion investment, several analysts told TheWrap.
Given that Disney+ signed up 4 million subscribers on its first day last November, the Quibi debut was “not a great start out of the gates” for founder Jeffrey Katzenberg and CEO Meg Whitman, Wedbush analyst Dan Ives told TheWrap.
Ives said Quibi, which will cost between $4.99 and $7.99 per month following its free 90-day trial, will need to distinguish itself from a crowded market of streaming services with hit shows if it wants to pull eyeballs away from bigger — and cheaper — outlets. Quibi debuted with shows starring Jennifer Lopez, Christoph Waltz and Chrissy Teigen, among other stars, but most of its big-name series weren’t available on launch day.
“Many consumers, and especially younger demographics, put YouTube above food and water on the priority list, and it’s free,” Ives added. “Competing against this platform is an uphill battle for Quibi.”
Reps for Quibi did not immediately respond to a request for comment for this story.
Jon Giegengack, principal analyst for Hub Entertainment Research, noted a recent Hub survey that found millennial and Gen Z consumers were intrigued by Quibi — until they found out they couldn’t access it anywhere except their phones.
“Certainly, you would’ve hoped they got off to a faster start,” Giegengack said about Quibi’s first-day downloads. “The fact that it’s a paid platform, and still that you can’t watch it on your TV set, is going to be a hurdle for them to overcome.”
Speaking of hurdles, Quibi ran into a few right away. The app was thrashed by a number of outlets: “Its mobile-optimized videos aren’t better than what has been on Snapchat, Instagram and Facebook for months,” USA Today wrote. Several people complained on Twitter they ran into signup issues.
Aside from free apps, Quibi will be fighting for viewers with established streamers like Netflix, Hulu and Amazon Prime Video, along with juggernaut newcomers like Disney+.
Despite the $1.75 billion investment, Quibi is hard-pressed to compete with Disney and its century of history and fan sentiment — and deep library of beloved content. That’s why Paul Hardart, a former Warner Bros. executive and current head of the Entertainment, Media and Technology program at NYU, said it’s “way too early to tell” if Quibi will flourish or flop based on its first day’s performance.
“Though Disney’s numbers are certainly something to shoot for, Quibi is a new concept and a new brand and, thus, shouldn’t be expected to reach Disney-level scale in its first day,” Hardart said. “Their key challenge is going to be to attract users, get word of mouth and then convert those downloads into paying subscribers. Let’s see where they are in 60, 90 and 120 days.”
Katzenberg, in an interview with TheWrap earlier this year, made it clear he won’t be dwelling on a slow start — especially in comparison to Disney+. “We’re in a marathon, not a sprint,” Katzenberg said. “Disney+ is a 100-year brand with the most valued and important generational IP on Earth, ever. We’re a different use case, and we don’t have the same brand recognition. So we don’t think we’ll take off like a rocketship. We think it’s something we build over the course of several years.”
One thing that may help Quibi’s subscriber figures is the year-free deal it negotiated for T-Mobile subscribers, according to Omedia analyst Sarah Henschel. Disney has noted that received 20% of subscribers to Disney+ through a similar partnership with Verizon. But Henschel added that Quibi’s pricing “seems a bit high” when comparing to Apple TV+ and Hulu, which both offer mobile and TV viewing.
“Short-form mobile-oriented content should likely be priced a little lower, especially considering it also has ads,” Henschel said. “Time may prove me wrong, but Quibi feels a little expensive in the current marketplace.”
Henschel also faulted the new service’s user interface, which doesn’t even note the main talent of its shows. “When Quibi’s strongest asset is its star power, they should be shining a spotlight on the cast within the descriptions in the home page,” she said.
That’s probably the key here for Quibi. To keep attracting new subscribers — and keep them from deleting the app when their free trial expires — Quibi needs to find its version of the Disney+ hit “The Mandalorian,” a show viewers feel they’d be missing out on if they don’t subscribe. That’s harder to do when you don’t have “tentpole millennial-friendly” brands like Marvel and Star Wars, Creatv Media chairman Peter Csathy noted in his newsletter this week.
Quibi has spent big bucks on a who’s who of celebrities to make original shows, but the jury is still out on if it’ll be enough to win over viewers.
“Do millennials really care about ‘A-list brands’ like Academy Award-winning directors Guillermo del Toro and Peter Farrelly signing on to create exclusive premium content for the service?” Csathy asked. “Will that kind of traditional Hollywood name-dropping matter?”