Quibi Struggles To Find Its Place
Quibi, which is short for "quick bites," is the brainchild of Hollywood mogul Jeffrey Katzenberg. Katzenberg, who served as chairman of Walt Disney Studios and was a co-founder and CEO of DreamWorks Animation, founded the startup in August 2018.
Quibi is short-form video platform designed for smartphones where users who are on the go can watch content in chapters of 10 minutes or less.
Since its founding, Quibi has been a hot topic in Hollywood and the startup community. The company raised $1.75 billion from most of the major Hollywood studios before it even launched last month.
Despite big-backers and endless media coverage, Quibi fell out of Apple’s Top 50 chart in less than two weeks after its debut on April 6. Following the initial pop in downloads, users began to get frustrated that the content could only be viewed on a phone.
Following the weak debut and criticism of its mobile-only viewing capability, Quibi quickly took a U-turn as it said users would be able to stream content on their TVs.
With Quibi now now ranked 125th in Apple's app store rankings, Katzenberg was recently interviewed and provided his thoughts on Quibi's struggles.
"I attribute everything that has gone wrong to coronavirus," Katzenberg said. "Everything. But we own it."
Quibi says the app has received about 3.5 million downloads, with 1.3 million active users. Katzenberg was clearly not enthusiastic about those statistics.
"Is it the avalanche of people that we wanted and were going for out of launch?" Katzenberg asked. "The answer is no. It’s not up to what we wanted. It’s not close to what we wanted."
"If we knew on March 1, which is when we had to make the call, what we know today, you would say that is not a good idea," Katzenberg said when asked if Quibi should've launched at a later date. "The answer is, it’s regrettable. But we are making enough gold out of hay here that I don’t regret it."
With Quibi's debut not living up to the hype, Katzenberg said the company will scale back its previous spending plans.
"Until we are in an environment where we can get a return on our investment, we are going to keep our powder dry," he said.
Katzenberg's anger was seemingly on display when asked about the popular app TikTok, in which users generate their own short-form content.
"That’s like comparing apples to submarines," Katzenberg said. "I’m happy for them, but what the hell does it have to do with me?"
At a time when people are cutting the cord at a record rate and other content providers such as Netflix are seeing a spike in usage, Quibi appears to be struggling to find its place.
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Saudi Aramco takes a hit. Saudi Aramco's profit fell 25% in the first quarter as oil prices collapsed amid oversupply and weakening demand. Net income fell to 62.5 billion riyals compared to 83.3 billion riyals during the same period last year. "The Covid-19 crisis is unlike anything the world has experienced in recent history and we are adapting to a highly complex and rapidly changing business environment," Saudi Aramco President and CEO Amin Nasser said.
Uber approaches Grubhub. After investing in Lime last week, Uber has reportedly made an acquisition offer for Grubhub. Shares of Grubhub, which has a market capitalization of about $5.5 billion, soared by more than 30% on the news. "As we have consistently said, consolidation could make sense in our industry, and, like any responsible company, we are always looking at value-enhancing opportunities," Grubhub said in a statement. Both Uber and Grubhub declined to comment on the rumors.
Toyota profit to plummet. Toyota Motor Corporation, the world's second-largest automaker, expects profit to fall 80% this year as the coronavirus halts automobile sales. Toyota is forecasting 2020 global automobile sales of 8.9 million vehicles, the lowest in nine years. "The coronavirus has dealt us a bigger shock than the 2008 global financial crisis," Toyota President Akio Toyoda said. "We anticipate a big drop in sales volumes, but despite that we are expecting to remain in the black. We hope to become a leader of the country’s economic recovery."
Which airline will it be? Boeing CEO Dave Calhoun believes a major U.S. airline will go out of business this year as the coronavirus has hit the airline industry. "Traffic levels will not be back to 100%," Calhoun said. "They won’t even be back to 25%. Maybe by the end of the year we approach 50%. So there will definitely be adjustments that have to be made on the part of the airlines." Following Calhoun's comments, a Boeing spokesperson said "He was speaking to the general uncertainty in the sector, not about any one particular airline."
Will people rush to malls? Simon Property Group, the largest mall owner in the U.S., plans to have roughly half of its properties opened within a week. Simon, whose profit fell more than 20% in the first quarter, already has 77 properties opened in areas where local restrictions have been relaxed. "We are now leading the effort for these local economies to get back to business," Simon CEO David Simon said. "We want to help these local communities ... because frankly they depend on our sales taxes."