streaming wars

What Is Jeffrey Katzenberg’s Quibi All About, and Why Should You Care?

The start-up promises content from filmmakers as illustrious as Steven Spielberg, Steven Soderbergh, and Antoine Fuqua. It’s coming for your phone.

By Nicole Sperling

June 14, 2019

Since 2012, the amount of time we spend watching video on our phones has exploded from a mere six minutes per day to close to 70 minutes, according to market research firm eMarketer. The health effects of such behavior notwithstanding, that time means a lot of things: a revolution in media consumption habits, a new distribution puzzle for content companies to crack, the rise of Gen Z, and, of course, an opportunity for one of the most successful entrepreneurs in the recent history of the entertainment industry. It may have taken a bit of time, but people are once again listening to what Jeffrey Katzenberg has to say.

The 68-year-old executive, who reinvigorated Disney in the late 80s, co-founded DreamWorks Animation in the 90s, and then sold it to NBCUniversal in 2016 for $3.8 billion, has foregone a quiet retirement to partner with former eBay CEO Meg Whitman to form Quibi (short for “quick bites”), a platform set to launch next April that’s dedicated to bringing premium, episodic content to pocket-size screens. Just don’t call it TV.

“I’m going to continue to believe, and argue, and preach that Quibi is not a substitute or a competitor for television,” Katzenberg told me when we spoke this week. “Our [service] is exclusively about what you do from 7 a.m. to 7 p.m. on your phone. And what you’re doing today, if you’re in our core demographic of 25- to 35-year-olds, is you’re actually watching 60-70 min of YouTube, Facebook, Instagram, and Snapchat. That growth is now a well-established consumer habit that Quibi is sailing into.”

The company has been in the works since 2018, and Whitman and Katzenberg have slowly been building buzz around it. (They announced the name at Vanity Fair’s New Establishment Summit last fall.) But this week saw a ramp-up in their press offensive, with more details trickling out. The service will cost users $4.99 a month with advertising and $7.99 without, and will feature about 7,000 pieces of content at launch—including Quick Bites, which are unserialized programming, such as the new eight-episode stunt-driving series starring British heartthrob Idris Elba and rally car driver Ken Block; Daily Essentials, a three times a day, six-and-a-half minute news program curated for your personal tastes; and their pièces de resistance: “Lighthouses,” serialized programming from filmmakers as disparate as Steven Soderbergh and Paul Feig, that will likely range in length between two to four hours and are divvied up into 7- to 10-minute chunks.

The young company will need all the talent it can sign. The coming year will see an explosion of direct-to-consumer platforms launching, from Apple’s TV initiative sometime this fall to Disney+ in November to WarnerMedia’s service in early 2020. Those are in addition to already established giants in the field: Netflix, Amazon Prime, and Hulu. While Quibi will also be asking consumers to shell out cash for its content, Katzenberg is insistent he’s not in the business of competing with those out to disrupt the television industry. To highlight this point he says that only 10 percent of Netflix, Amazon, and Hulu subscribers watch their content on mobile phones, whereas Quibi content will only be available on mobile phones.

“We think people will come for the Lighthouses, will be delighted by the Quick Bites, and then they stay and form a daily consumption habit around our Daily Essentials,” Whitman told me this week in a separate call.

The company has raised $1 billion in funding from investors such as Disney and Viacom, and has lured executives such as CAA’s Jim Toth and Warner Bros.’ Diane Nelson to its executive ranks. On Friday Quibi announced its board of directors now includes Mellody Hobson, president of Ariel Investments; Ann Daly, co-founder at WndrCo; Harry “Skip” Brittenham, founding partner of Ziffren Brittenham LLP; and Greg Penner, founder of Madrone Capital Partners. (Roger Lynch, CEO of Vanity Fair’s parent company, Condé Nast, is also a member of the board.)

It says it will give financial control to its creators. The company will exclusively license the content in bite-size-chunk form for seven years—but after two years on the service, the creator of the show (and the studio behind it) will be able to edit it into one contiguous piece and sell the rights to a global audience, reaping the financial rewards that come with such a deal.

That’s allowed for things to get a little wacky.

Steven Spielberg has signed on to make a horror anthology that users can only watch after dark. (The app will feature a countdown clock alerting you when sundown is about to hit.) Training Day director Antoine Fuqua is currently producing a two-and-a-half-hour drama series titled #Freerayshawn in New Orleans, with If Beale Street Could Talk’s Stephan James in the lead. (It will be broken up into 15 chapters; the long division holds up.) In recent days, other creators such as Feig, The Killing’s Veena Sud, and Soderbergh have all signed on to make episodic bites. Twilight director Catherine Hardwicke announced Wednesday that she will be directing a sci-fi series starring Don Cheadle, called Don’t Look Deeper, that centers on a high school senior who believes she’s not human.

“There is no question that the business opportunity matches the creative opportunity,” said Katzenberg. “From day one the inspiration for this is the TV industry that I grew up in. Before the financial rules of syndication went away, the networks never owned their I.P. They were only able to license it for a prescribed window. The real blockbuster home run came in ownership, specifically the post-network window where suddenly the creators and owners of the content were able to make genuine fortunes...Our aspiration is they will be paid well, and competitively, for their time making the content with us. But the blockbuster here is if they make something great, two years later they [will] own it. That’s the uniqueness of this, and I think has been a big appeal.”

Indeed Fuqua, who is producing #FreeRayShawn from a script written by Marc Maurino (Inside the Machine) that he was previously considering directing as a feature film, was inspired to be the first out of the gate at Quibi because he both believes in reaching audiences where they are now, and was intrigued by the financial model.

“Someone is basically financing a film or a TV show for you on a new platform, and then for the film itself, you get to own the I.P.,” said Fuqua, who describes his project as a Dog Day Afternoon–like tale in which an Iraq War vet finds himself in a showdown with the New Orleans SWAT team, and tries to talk his way out of the jam. “I can’t think of a better situation. Quibi is basically paying for a film, and then in a few years time, you get to own it. It’s incredible.”

While Whitman and Katzenberg describe themselves as “diametrically opposite”—she the buttoned-down, left-brained, analytically-minded exec, he the right-brained, shoot-from-the-hip instinct guy—they believe that their disparate expertise and points of view are what give them a leg up, their “superpower,” as they put it. And hey, why not? In the great content boom, we’re watching platforms try to become studios, while studios aspire to become tech companies.

“We are doing something that hasn’t been done before,” said Whitman. “And while all start-ups have a certain amount of uncertainty, I worry about what Jeffrey is responsible for, which is the content, and he worries about what I’m responsible for, which is everything else. We feel pretty good about our relative areas.”