Quibi Holdings LLC, the short-video upstart founded by movie mogul Jeffrey Katzenberg, won’t have a Hollywood ending, reports Bloomberg.
After just six month, the company announced Wednesday that it plans to wind down operations and sell its assets after failing to attract enough viewers. After debts are paid, any remaining funds will be returned to investors, who put up US$1.8 billion to launch the ambitious startup.
“Our failure was not for lack of trying; we’ve considered and exhausted every option available to us,” Katzenberg and Quibi Chief Executive Officer Meg Whitman said in an open letter.
The swift demise represents one of the entertainment industry’s most dramatic flops. Quibi’s app, which launched in April, was meant to showcase engaging short-form videos with big stars. It also used technology that made it easy for viewers to see shows on their phones vertically or horizontally.
Quibi was backed by money from giants of media and finance, including Walt Disney Co., AT&T Inc.’s WarnerMedia and Goldman Sachs Group Inc. It also attracted ad money from big marketers such as Walmart Inc. The idea was to entertain people during commutes and other dull moments -- like a wait at the dentist’s office.
But COVID-19 meant there were fewer of those moments to be had. The app also couldn’t play on TVs initially, limiting its appeal to home-confined couch potatoes.
“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,” Katzenberg and Whitman said. “We were not able to do so.”
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