Nascent streaming platform Quibi has reportedly lost over 90% of its userbase after free 90-day trials offered during the app's launch ended. The app hasn't done well for itself in general, launching with numerous shortcomings and drawing far fewer users overall compared to industry giants.
The data regarding Quibi's userbase comes from Sensor Tower, an analytics firm specializing in the mobile app market. According to Streaming Tower, just under 10% of the app's userbase converted the paid subscribers while the rest abandoned the app. 910,000 users initially joined the app during its April launch, but only 72,000 or so remain.
The drop is unsurprising, given Quibi's relatively obscure nature and the stiff competition the fledgling service faces from market giants such as Netflix (NASDAQ: NFLX), Hulu, and Disney+ (NYSE: DIS). Quibi was entering a market already hotly contested by companies with sizable market shares and far more massive streams of revenue.
To make matters worse for Quibi is the lack of noteworthy content and the actual type of content it produces. When consumers think of the sector giants, they can quickly think of notable shows for each: Netflix has massive hits such as Stranger Things and Tiger King; Disney+ has The Mandalorian as well as an enormous backlog of Star Wars content and Disney's decades of films; Hulu has Harlots, Ramy, and Letterkenny. Further compounding the struggle for viewers is the rising prevalence of network-based streaming services such as NBC's soon-to-launch Peacock (parent company Comcast, (NASDAQ: CMCSA) or HBO Max (parent company AT&T, (NYSE: T), which possess backlogs of popular TV shows such as 30 Rock and Downton Abby for NBC, and Game of Thrones and The Sopranos for HBO.
Quibi's claim to fame was its short-form content, usually only nine or so minutes long. Critics of the platform, while mixed to negative on Quibi overall, were receptive to the format of short-form shows, though it's worth noting that they had little good to say about the actual shows themselves. Quibi's short-form content isn't entirely unique, however; short-form flash cartoons and short live-action skits have been a staple across many internet sites since the early 2000s, and are often provided for free. Alphabet's (NASDAQ: GOOGL) YouTube has been host to many of these short-form shows since its earliest years and has a large userbase that actively follows the platform's various creators. Quibi's competition with YouTube is slated in favor of Alphabet's video-sharing platform, which is both a free service (albeit with ads, although Quibi's basic plan does contain advertisements as well) and the most visited site on the internet. Considering Quibi is a brand-new service with mediocre reviews, and no smash hit shows to speak of, any competition with YouTube will be depressingly one-sided.
Even worse for Quibi was its unfortunate timing. Professionally made short-form content would be a far more intriguing concept if Quibi were released about a year ago. Still, Quibi pushed forward with its April release despite being in the midst of the worst of the coronavirus pandemic. Short-form content in the vein of Quibi's shows is best marketed towards busy Americans who would likely take in episodes during their commute or during breaks throughout the workday. With so many Americans furloughed, unemployed, or working remotely, consumers had plenty of time to devote to full-length content from existing streaming platforms they already had subscriptions to.
Something to consider about Quibi's failure is the considerable financial and material support the platform had, mainly from big entertainment industry names such as Disney, Sony (NYSE: SNE), AT&T, and Viacom (NASDAQ: VIAC). Not only did the firms provide money, but much of Quibi's shows were produced via partnerships with its investors. The high hopes investors had may be dashed upon the news of the massive exodus of users. If enough investors lose hope in the platform, Quibi's future will inevitably become far more uncertain than it already is. Given that Quibi's investors already have existing shares in the streaming market, there's a considerable possibility that they could cut their losses and focus on their own platforms with little in the way of losses.
For its part, Quibi has tried to dispute Sensor Tower's findings. Quibi has tried to assert that 5.6 million users have downloaded its app and that conversion to paid subscribers was "above mobile app benchmarks." Quibi did not provide any hard numbers, which makes their claims dubious at best. Sensor Tower, on the other hand, has a solid reputation as an accurate analytics group, and there's little reason to doubt the veracity of the company's findings.