Why Quibi failed

The launch and subsequent failure of this supposed Netflix rival tells a poignant story of big money placed in out of touch hands.

It seems like a lifetime ago since Quibi officially launched. In the time since the short video service went live on app stores in April we’ve seen the true fallout from Coronavirus worldwide, the run up to the most heated election in generations, and countless other huge global events. But Quibi’s rise and fall happened in a remarkably short time and, despite its troublesome global backdrop, its failure is not the fault of current events.

It was only six months after launching that Quibi shut down and followed a series of emergency moves by its developers to try and make it work. Nearly $2 billion was invested into the idea and yet many saw it’s failure as inevitable.

So let’s rewind and take a look at what caused Quibi to become such a miserable failure.

The Concept

The idea for Quibi started making the rounds in 2017 when the service’s eventual founder, Jeffery Katzenberg, began raising money for it. The concept was simple: A short video platform that tailors to the binge-watching consumption of modern media consumers whilst appealing to the shorter attention spans of the internet generation.

Essentially; Quibi wanted to provide an alternative to Netflix offering shorter content. Not that bad an idea, you might think. Unfortunately, their adamance that Quibi stick to such a firm format raised eyebrows for many on the outside of the conception.

Quick Bites

The platform had to provide content that was 10 minutes long or less. No longer. That’s the whole shtick; it is a platform for “quick bites”. So when they started developing their own movies, things started to look funky. Feature-length films that had to be watched in 10 minute segments; Quibi thought this was fine.

But they wouldn’t alter the platform for their longer content; they had to still be split into short segments – almost like… a series? But no, they were created as feature length films inevitably leading to jarring and disjointed viewing experiences.

Portable Content

Another USP for Quibi (though, unique failing point may be more apt) was that it was only available on mobile devices. Their reasoning was this: Quibi was designed for the new generation of media consumers who watch things on their smartphones and tablets, who don’t have time to commit to content longer than ten minutes; it was supposed to be forward thinking and cater to a new generation.

What they somehow failed to see, however, is just how constricting a mobile-only platform is. Of course having a mobile companion to Netflix and YouTube drives lots of views, but that is because it is an EXTRA platform to watch on as well – not the sole source of it’s consumption.

Without an existing audience, Quibi made a huge bet on people taking a chance on watching their content solely on their mobile devices. With huge investments in original TV series and – we’re going to bring up this madcap fact again – films, they expected these new users to watch them entirely on their mobile devices.

Sure, it might have been great for catching up on the latest episode during your commute. But what about when you get home then and want to carry on? Sitting on your sofa and squinting at your mobile screen hardly sounds like a top-notch viewing experience, regardless of how high definition mobile screens are now.

How Original

Quibi wanted to create an entirely new block of content. They didn’t want to worry about licensing existing material and competing with other platforms over the same content. So; they used the majority of their huge rounds of funding to produce entirely original content; enlisting celebrity names like Anna Kendrick and Liam Hemsworth along the way to add credibility and talent.

Unfortunately, this extremely risky move meant that the app was betting on people coming to an entirely new service, only available on their mobile devices, for shows and films (films!!) that they’d never heard of.

In fact, it is testament to the boldness of this move that their most popular show was a reboot of ‘Reno 911!’. In fact, according to JustWatch’s popularity scores, that reboot was more popular than all of Quibi’s other content combined!

Image & Data Credit: JustWatch

Any of these three creative decisions on their own could easily be waved off as a fair risk with the ultimate aim of creating a unique draw. Together, however, these three content restrictions drove an unsuccessful medium that failed to make a margin of their expected impact – despite their excuses often leading elsewhere.

The Launch

So Quibi – willingly ignoring the huge risks they were making with their concept – launched on app stores at the start of April. They were enticing users in with huge three-month trials, betting on user retention big enough that 3 months of losses would pay out in dedicated audiences.

Even in free trial users Quibi flopped hard at the beginning and saw no signs of re-emerging success. The app fell out of the top 50 charts after just a week. They saw 3.5 million downloads and 1.3 million active users a month after launch, far below their expectations and made up in the majority by free trials.

Image & Data Credit: JustWatch

The uptake was simply not there and a month after their launch Katzenberg blamed their initial flops on the spread and wide-reaching effects of COVID-19 as the impact really began in those early months.

Katzenberg said in May: “I attribute everything that has gone wrong to Coronavirus. Everything.” No doubt, their launch came at an unfortunate and remarkable global situation. But as I covered earlier, me-thinks t’was not all simply the fault of Coronavirus. Other streaming services saw thriving performance like never before in those very same months, as more and more viewers were left stuck at home with their TVs, computers, and smartphones for company and entertainment.

Then came the back-pedalling on their USPs (UFPs). In June, Quibi made one of their few sensible business decisions; they launched support for Chromecast streaming, allowing viewers to watch their content on TV. That same week they announced a 10% pay-cut for their executives.

Too little too late? Well, we all know Quibi’s fate by now.

The Death

In October – after raising almost $2 billion in funding and trying to build an audience for 6 months – Quibi announced that it was shutting down.

In an open letter to their employees, investors, and partners, Katzenberg and Quibi’s CEO explained their decision to abandon the service and apologised to all of those involved for it’s failure.

They explained that their failure was not down to a lack of effort; and by god I believe that, I’m sure that these people did actually care about making a success out of their platform. However; effort wasn’t enough to lift up their disastrous combination of risky decisions which ultimately didn’t pay off.

In the open letter Katzenberg relented somewhat to putting the blame entirely at the doorstep of the unfortunate timing with Coronavirus, writing:

Quibi is not succeeding. Likely for one of two reasons: because the idea itself wasn’t strong enough to justify a standalone streaming service or because of our timing.

Unfortunately, we will never know but we suspect it’s been a combination of the two. The circumstances of launching during a pandemic is something we could have never imagined but other businesses have faced these unprecedented challenges and have found their way through it. We were not able to do so.

They made the difficult decision of returning cash to their shareholders and shutting the platform down, sending its workforce packing. Fortunately, I can’t imagine there were very many users clinging on to the sinking ship who found themselves waving a fond farewell.

Whilst the platform didn’t last, the content will no doubt keep the spirit of Quibi alive to some extent. They are currently looking to find buyers for their original content, some of which garnered awards despite the lack of viewership.

If Quibi teaches us anything it’s that when making a bold new venture you should really consider the opinions of the audiences whose unique, new characteristics you’re trying to appeal to. For so many, Quibi’s failure felt obvious yet the executives involved didn’t see that.

More-so than being out of touch; I think that it was an idea with potential that was simply executed poorly and with too many attempts to move away from competing platforms. But the accumulation of poor ideas around the good idea suggests that they certainly could have been more “in touch” with consumers.

Snapchat acquires social music creation and short-video sharing app Voisey

According to a recent filing, Snapchat may be taking more steps into the music industry and potentially build yet another TikTok competitor.

Picked up by Business Insider, Voisey’s filing on Companies House changed their registered UK address to Snap’s London office, with a source confirming the acquisition to BI. The terms of the deal have not been disclosed, but Voisey is currently valued at around $3 million. No comment has been made by Snapchat’s parent company Snap Inc or Voisey.

Voisey was founded in 2018 by a collective of music-tech entrepeneurs and ex-employees of Universal Music, Rdio and Soundio from Norway and London. The app has a very familiar interface, with many lip-synced, vertically scrollable videos. Unlike TikTok who have partnerships with many major record labels, Voisey instead features user-created beats, allowing musicians, vocalists and producers to upload backing tracks to their catalogue. Popular genres on the app include hip-hop, R&B and trap. Creators can record up to 60-second videos and overlay their own vocals on to beats. Clips can be edited, with auto-tune, choral, spacey and other vocal effects added. Users can like and comment on clips as on TikTok, Reels, etc.

An artist named Olivia Knight, known on the app as username Poutyface, recently signed a record deal with Warner Music after success on the platform.

This purchase from Snap could indicate Snapchat feeling left out among TikTok and replicas from the likes of Instagram Reels. Will Snapchat create a TikTok replica or just implement some of the musical element from Voisey within Snapchat?

We are on the verge of a revolution in music creation with the boundaries between creator and audience blurring like never before. Apps like Voisey focus on giving consumers tools that enable them to go from zero to 100 faster than ever before. Just like TikTok enabled consumers to create high-quality videos fast, and Instagram enabled consumers to create high-quality photos fast, the new generation of creator tools are enabling consumers to make music fast. Snapchat sees itself being able to be at the center of that.

Mark Mulligan founder of MIDiA Research to Business Insider

Download Voisey on iPhone here. Upload your own beats online.

This isn’t the first instance of Snapchat dipping its toes in the music industry this year. Last August saw the social media company partner with WMG and UMG, so users can add songs to their snaps.

TikTok add more tools for parents to restrict features of the app on their teens device

TikTok launched Family Pairing earlier this year, letting parents control certain aspect of their teen’s app. Now TikTok are introducing additional tools.

Launched in April this year, Family Pairing allows parents to link their TikTok account with their teen’s and set controls such as Screen Time Management to limit how much time teens spend on TikTok each day, Restricted Mode to limit the type of content that appears and Direct Messages to control who can send messages or turn off the function completely. With the app used by millions of those in the Gen Z demographic, these tools attempt to make the app more suitable for a younger audience, ensuring digital safety and protect their privacy.

This week, TikTok are rolling out an update worldwide that will include additional tools to manage their teen’s account:

  • Search: Decide whether your teen can search for content, users, hashtags, or sounds
  • Comments: Decide who can comment on your teen’s videos (everyone, friends, no one)
  • Discoverability: Decide whether your teen’s account is private (your teen decides who can see their content) or public (anyone can search and view content)
  • Liked Videos: Many people enjoy finding new videos to watch that others they follow have also enjoyed, but this control empowers families to decide whether others can see the list of videos your teen has liked

‘Family Pairing’ settings are here to help provide a family-friendly experience for everyone! #ParentsOfTikTok

♬ original sound – TikTok Tips

In the US, TikTok also accommodate those under 13 years old with TikTok for Younger Users. This is a view-only experience with curated content.

Other social media platforms such as Instagram and Snapchat currently offer no similar parental controls. Depending on the success TikTok see here, perhaps we’ll see others follow suit.

Instagram’s redesign gives quick access to Reels and Shop

Image credit: Instagram

One of the biggest redesigns to Instagram since its launch puts Reels and Shop tabs in the footer, in place of New post and Activity tabs.

Reels and Shop get their own dedicated tabs at the bottom, that can be quickly accessed throughout the app

From left to right, Instagram’s tabs are now:

  • Home – the main Instagram feed
  • Search – search for profiles/hashtags and a collection of pictures, video and Reels
  • Reels
  • Shop
  • My profile – your feed, stories, bio, followers, IGTV, Reels and so on

Reels is Instagram’s TikTok clone. The whole interface is almost identical to TikTok’s, with an endless, algorithm-tailored, vertically swipeable feed of short-form videos. Instagram Reels launched in Brazil a year ago, with a full roll-out around six months ago. Hoping to steal TikTok users, Instagram feel the feature is ready to be placed front and centre.

Instagram’s Shop tab is a personalized list of merch. Featuring recommendations as well as an editor’s curated pick of items, be it t-shirts from influencers, albums from artists or shoes from a sneaker company. The feature was rolled-out earlier this year to specific brands and creators.

These tabs are in place of New post and Activity – showing new likes, followers and tags. Both of these screens can now be found in the upper right corner of the homescreen. New post can also be accessed by swiping to the right on the homescreen.

We don’t take these changes lightly – we haven’t updated Instagram’s home screen in a big way for quite a while. But how people create and enjoy culture has changed, and the biggest risk to Instagram is not that we change too fast, but that we don’t change and become irrelevant. We’re excited about the new design and believe it gives the app a much-needed refresh, while staying true to our core value of simplicity. We’ll continue listening to your feedback so we can keep improving Instagram for you.

Adam Mosseri, Head of Instagram

Many users have been frustrated by the change, however this is expected for any major social platform’s design change. Once the new locations of certain buttons becomes ingrained, it will be soon forgotten.

Vimeo raised $150m as its parent company consider a spin-off of the video platform

Amid record revenue growth, US holding company and parent of Vimeo, IAC raised $150m for the video hosting/sharing platform and detail plans to separate Vimeo as its own company.

During IAC’s Q3 earnings report, CEO Joey Levin told investors that, like many other (but not all) media companies, Vimeo saw dramatic growth this year due to COVID-19.

Vimeo was initially seen as a competitor to YouTube, but more recently realising YouTube’s total domination of the online video space, changed its business strategy, offering live streaming and screen recording, editing, distribution, storage and monetization. These tools have of course been in high demand since stay-at-home orders earlier this year.

Vimeo brought in $75.1m revenue in Q3 2020, a massive 44% year-over-year growth from Q3 2019 and it’s first positive EBITDA at $3.4m. Vimeo now has 1.5 million individual monthly subscribers, up from 1.4 million in the previous quarter. IAC also reported Vimeo have 3,500 brands paying for its tools and has seen growth in organic and self-service sales. At the end of 2019, organic bookings (booking without extra marketing effort) made up 27% of total sales. This rose to 41% of total sales by the end of Q1 2020, then 79% in Q2, now sitting at 56% in Q3.

In a letter to shareholders, Levin said:

On the Self-Serve segment of our revenue (meaning, a customer begins to pay Vimeo without having spoken to a salesperson), we’re seeing about $5 in profit for every $1 we spend in marketing. That ratio has continued to steadily improve and we haven’t yet found the limit on our ability to spend on marketing with those returns.

Joey Levin, CEO, IAC

As a result of the success, IAC has “begun contemplating spinning Vimeo off to our shareholders”. This won’t be IAC’s first spin-off company this year. In July, Match Group, who own Tinder, Match.com and other dating apps, separated from IAC, dividing stake in the company among shareholders.

“We expect Vimeo’s access to capital inside of IAC will be much more expensive than access to capital outside of IAC,” to evaluate this theory, IAC held funding for Vimeo to test how it would fare standalone “we had more interest in Vimeo than the number of shares we were willing to let Vimeo sell.”

Vimeo went on to raise $150m at an implied enterprise value of $2.75bn from investors Thrive Capital and GIC. IAC are yet to go through with the spin-off. “There’s a long way to go before we’re decided on that, and far too early to speculate on what the terms of that spin would look like”.

Quibi – The Netflix That Never Was – “When a boomer tried to make Netflix” (Video)

Dagogo Altraide from ColdFusion covers the background and reasons founder Jeffrey Katzenberg’s $1.75 billion app failed, as well as the biggest mistakes that lead to Quibi’s closure.

Just six months after launching, Quibi has announced it’s shutting down.

MelodyVR report an operating loss of £10.5m for the first half of 2020

Live music in virtual reality startup and future owner of Napster – MelodyVR report disappointing half-yearly earning results for 2020.

MelodyVR recently published their earnings for the first six months of 2020, generating just £189.9k ($248.2k) of revenues from live streams, selling merch and vinyl.

Royalties and content creation costed the company £1.3m ($1.7m), while administrative expenses were at £9.4m ($12.3m). This amounted to £10.5m ($13.7m) operating loss and £10.7m ($14m) net loss for the first half of 2020.

In September, MelodyVR announced it will be acquiring Napster. In the report, MelodyVR outlined their plans for the streaming service:

Over the course of the coming months we intend to develop a new application which will enable us to drive revenues by providing users with a premium, recurring, monthly subscription service. For a monthly fee, music fans will receive access to Napster’s recorded music library of 80m+ tracks, together with new live audio recordings, long and short form video content and MelodyVR’s library of immersive VR experiences.

Anthony Matchett, Executive Chairman & CEO, MelodyVR

Later stating that “completion of the transaction is dependent upon securing additional funds associated to secure the working capital requirements going forward”.

Top 10 most-viewed YouTube videos 2020

With Baby Shark recently taking the top spot, here are the top ten all-time most viewed videos around the world on YouTube in 2020.

1. Baby Shark Dance | Sing and Dance! | @Baby Shark Official | PINKFONG Songs for Children
7.05 billion views

2. Luis Fonsi – Despacito ft. Daddy Yankee
7.04 billion views

3. Ed Sheeran – Shape of You [Official Video]
5.04 billion views

4. Wiz Khalifa – See You Again ft. Charlie Puth [Official Video] Furious 7 Soundtrack
4.79 billion views

5. Masha and The Bear – Recipe for disaster (Episode 17)
4.36 billion views

6. Johny Johny Yes Papa 👶 THE BEST Song for Children | LooLoo Kids
4.15 billion views

7. Mark Ronson – Uptown Funk (Official Video) ft. Bruno Mars
3.99 billion views

3.84 billion views

9. Учим цвета-Разноцветные яйца на ферме
Learning Colors – Colorful Eggs on a Farm
3.65 billion views

10. Justin Bieber – Sorry (PURPOSE : The Movement)
3.35 billion views

Click here to see how Baby Shark recently became the most viewed video on YouTube.

Click here to see the ten most-viewed music videos on YouTube.

Baby Shark is the most viewed video on YouTube

(As if 2020 couldn’t get any worse) Baby Shark take the top spot on YouTube from Despacito, with over 7 billion views.

With 7.05 billion views, Baby Shark overtakes Luis Fonsi – Despacito with 7.04 billion views, for the most viewed video on YouTube. Despacito held the top spot for over three years after the music video took the crown from Wiz Khalifa – See You Again.

This is hardly surprising especially among parents of young children, however it seems the song has been on repeat particularly since the start of lockdown. Despite being released in 2016, in April 2019 the video reported had (only) 2.5 billion views, but has since grown a massive 181%. This significant, seemingly never ending growth can be seen in this graph from Wikipedia:

Most viewed video YouTube
Image credit: Wikipedia

Click here for the top 10 most viewed music videos on YouTube.

Events and live stream ticketing company DICE launches in India

London-based ticketing company DICE offers users recommendations for upcoming shows and more recently live streams. DICE is now available in India.

Founded in 2014, DICE is live in the UK, US, France, Italy, Spain, Australia and now India, offering gig tickets and recommendations to these countries and live streams worldwide, via the mobile app, desktop or TV.

DICE offers personalized recommendations for upcoming gigs, festivals, clubs, workshops and live streams around the world in the Discover section of the app. Discover is company’s recommendation engine, using algorithms as well as your listening data on Spotify and Apple Music.

DICE brought live streaming to its platform last April, just as the world got stuck at home. In the last six months, DICE has showcased over 4,000 live streams, sold tickets in 145 countries and hosted live streams from Laura Marling, Nick Cave, Kylie Minogue and Bjork.

“With venues in lockdown since the pandemic struck, high quality live streamed shows have quickly become an important new source of revenue and engagement for artists. DICE takes event livestreaming to the next level by putting Indian artists on a global stage. Fans in turn enjoy a best-in-class experience powered by personalised recommendations. We understand what it takes to make a great show fans love and only the best events make it on DICE.”

Phil Hutcheon, Founder & CEO, DICE

“DICE’s long term aim in India is to build a more sustainable live industry to help venues, promoters and artists thrive. Our commitment to the highest production values, as well as our unique ability to recreate the sense of anticipation and exclusivity that fans love about traditional gigs, means we attract the very best in local and international talent.”

Arnav Banerjee, India Lead, DICE

“There is talk of how live-streams are a temporary replacement to live shows, yet it’s clear that the virtual world of performance is not an alternative, but an addition of infinite possibilities for the artist and fan connection. Dice has a unique understanding of both, and for a multi-disciplinary artist like myself, their platform and discovery algorithms are opening up not just a global audience for me, but also the liberating opportunity to create my performance without generic format restrictions. It’s time to level up.”

Award-winning Mumbai artist Nuka (aka Anushka Manchanda)