(Bloomberg) — Quibi, one of Hollywood’s most ballyhooed startups, is having a rocky first year.
Founder Jeffrey Katzenberg envisioned an app that would entertain people during the odd, in-between times in their lives — while commuting, say, or waiting in line at the bank. But when the April launch date arrived, Americans were in lockdown due to the coronavirus, meaning such moments had all but disappeared.
On Sept. 21, the Wall Street Journal reported that Quibi has so far failed to reach its subscriber targets and is working with advisers to assess its options, including a possible sale or a capital raise.
A lot can change in the future. Quibi could have a wildly popular hit show that lures in millions of new subscribers. A nation of smartphone consumers venturing back into the world could embrace the service as their daily commutes return. Or the changes that Quibi has made, such as enabling users to watch Quibi on TV sets and to screenshot shows, could increase its popularity. Still, Quibi faces a formidable challenge. The company declined to comment for this article.
By compiling Quibi’s reported and public statements about content spending, advertising, subscribers and more, a picture emerges of a company headed for financial distress after a tough first year. In one scenario, if little changes, the company faces a funding shortfall of about $1.8 billion by 2024 and $6 billion by 2030. Katzenberg, who has made a career selling stories of characters beating the odds, has said he’s up for the test.
Quibi launched in a year of fierce competition, compounding the difficulty posed by the pandemic. Well-known brands, from HBO to NBCUniversal, started competing streaming services and existing ones, led by Netflix, were
Three-quarters of respondents didn’t know what internet speeds would be adequate for their household and the overwhelming majority have yet to upgrade their service.
To mitigate the spread of COVID-19, companies around the globe adopted remote work policies in recent months. At the same time, many schools and universities are conducting classes virtually to ensure the safety of students and staff this fall. Needless to say, this en masse shift to distanced learning and telecommuting has increased the need for high-speed internet for millions. A new survey analyzes consumers’ sentiment regarding their current internet capabilities, bandwidth needs, provider pricing expectations, and more.
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On Monday, HighSpeedInternet.com, a site to explore and compare internet providers, released a report detailing the results of a recent anonymous US survey involving 1,000 people. Overall, three-quarters of those surveyed did not know the internet speeds their household needed to match current demands. As the author of the report points out, this could explain why almost half (45%) said their current internet is too slow although only one-in-six (16%) have upgraded their internet service plans since the onset of the coronavirus pandemic.
For many, marketplace pricing appears to be playing a role in the decision to forgo an internet upgrade. The majority of respondents, about six-in-ten (61%), believe their current internet plan is overpriced. Nearly half of respondents believe that a “reasonable price” for internet service is in the $20 to $50 range. However, the average cost of monthly internet service is approximately $80, according to the report.
The report notes potential reasons explaining the disparity between the number of people who report having inadequate internet speeds and those who have upgraded their service. For one, the author reasons that