Barely six months after starting business with $2 billion, the mobile streaming service Quibi, is calling it quits.
“We feel that we’ve exhausted all our options. As a result we have reluctantly come to the difficult decision to wind down the business, return cash to our shareholders, and say goodbye to our colleagues with grace,” the company announced Wednesday in an open letter to the employees, investors, and partners.
It was a sudden end for the Hollywood company launched April 6, by big names in the entertainment industry who had high hopes of reinventing the streaming TV game.
“Quibi was founded to create the next generation of storytelling,” founder and board Chairman Jeffrey Katzenberg said in the statement. “The world has changed dramatically since Quibi launched and our standalone business model is no longer viable.”
Katzenberg, a former Disney executive who co-founded the studio DreamWorks SKG, made headlines while developing Quibi, reportedly raising almost $2 billion with former HP CEO Meg Whitman onboard at Quibi as its CEO.
“While we have enough capital to continue operating for a significant period of time, we made the difficult decision to wind down the business, return cash to our shareholders and say goodbye to our talented colleagues with grace,” Whitman said in statement.
So why did Quibi fail?
“I attribute everything that has gone wrong to coronavirus,” Katzenberg told the Times . “Everything. But we own it.”
But critics complained that it was difficult for users to share what they were watching on social media with friends and tough to find specific programming on the app. Initially, Quibi content was only viewable through the smartphone app and users couldn’t watch content on TV sets.
Critics also said that the platform failed to find a single, galvanizing hit show to gain users’ attention, debuting after major new streaming services from Disney and Apple had already been in the marketplace for months.
Nearly all of Quibi’s shows were terrible, The Verge said.
Subscribers will be notified at a later date since it will take a few months to shut everything down, including the loss of 200 employees.