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VI

Failure 15 · Business failures

The streaming service for phones that lasted six months

Quibi raised about $1.75 billion to make short, high-budget shows for phones, but too few people paid for it and it shut down about six months after launch.

  • Quibi
  • Los Angeles, United States
  • 2020
  • 3 min read
On this page
  1. The file in one minute
  2. Timeline
  3. What happened
  4. Why it failed
  5. Lessons for anyone deploying AI
  6. Would you have caught it?
  7. Sources
Before you readWhat would you do?

Your team wants to spend the whole year's budget building an AI app for customers, based on a survey where people said they "might" use it. What is the better plan?

Pick an answer now. The file tells you whether you were right.

01The file in one minute

  1. 1The idea

    Quibi made short, high-budget shows in chapters of 10 minutes or less, designed for watching on phones.

  2. 2The money

    It raised about $1.75 billion before launch and spent heavily before testing whether people would pay.

  3. 3The end

    It launched in April 2020 during lockdowns, kept too few subscribers and shut down in December 2020.

  4. 4The lesson for AI

    Famous names and big budgets do not prove demand. Test with real users before spending most of the money.

02Timeline

  1. Before launch

    Quibi raises about $1.75 billion from investors.

  2. 6 April 2020

    Quibi launches as COVID-19 lockdowns keep many people at home.

  3. 21 October 2020

    The founders announce Quibi will close.

  4. December 2020

    The service shuts down.

  5. January 2021

    Roku buys Quibi's shows.

03What happened

Quibi was founded by Jeffrey Katzenberg, a former Hollywood studio chief, with Meg Whitman, a former head of eBay and HP, as chief executive. The idea was "quick bites" of TV: shows split into chapters of 10 minutes or less, filmed with Hollywood stars and budgets, made to watch on phones while commuting or waiting in line.

Before launch it raised about $1.75 billion from investors. It launched on 6 April 2020, just as COVID-19 lockdowns kept many people at home, where they had TVs and fewer commutes. At first people could not easily share clips or watch on a TV screen, which limited how the shows spread online.

Many people tried the free trial, but few stayed as paying subscribers. On 21 October 2020 the founders announced Quibi would close, and it shut down in December 2020. Its shows were later sold to Roku.

04Why it failed

Quibi was built around a guess about how people would watch, and it spent heavily before testing that guess with real users. Short videos on phones were already popular on YouTube and TikTok, where they were free and easy to share. Quibi asked people to pay for something they could get elsewhere at no cost, and the pandemic removed the commute it was designed for.

The AI angle: big budgets and famous names do not prove that people want a product. With AI projects too, a small test with real users tells you more than a polished plan.

The idea behind this caseLesson: Review AI like a manager →

Kit the fox, ManuAI's guide, thinking it over

05Lessons for anyone deploying AI

  1. Test the core idea cheaply with real users before spending most of the budget.
  2. Ask what free options people already use for the same need, and why they would pay for yours.
  3. Make it easy for early users to share and talk about the product, since that is how many products spread.
  4. Plan what you will change if the world changes around your launch.
Your team wants to spend the whole year's budget building an AI app for customers, based on a survey where people said they "might" use it. What is the better plan?

06 — Would you have caught it?

Your team wants to spend the whole year's budget building an AI app for customers, based on a survey where people said they "might" use it. What is the better plan?

07 — Sources

  1. Quibi to Shut Down Six Months After Launch · The Hollywood Reporter · 2020-10-21
  2. Quibi · Wikipedia · 2024