Quibi, Jeffrey Katzenberg’s beleaguered mobile streaming startup, got 910,000 people to sign up for free 90-day trials within the first three days of its April 6 launch, according to new data from research firm Sensor Tower.
The bad news, according to the report: Only 72,000 subscribers stuck around and decided to pay $5 a month (or $8 without ads) for the service. That conversion rate, around 8%, does not bode very well as Quibi battles its way through COVID-19 and a crowded streaming field.
About 4.5 million total downloads of the app have occurred to date, Sensor Tower estimates.
While it’s not an apples-to-apples comparison, Disney+ converted about 11% of free trials to paid subscribers, Sensor Tower data showed last November.
But the well-funded, lavishly marketed company is pushing back on the report, saying the correct number of total downloads is 5.6 million. It declined to offer paid subscription stats or conversion rates but described them in upbeat terms.
“The number of paid subscribers is incorrect by an order of magnitude,” Quibi said in a statement. “Our conversion from download to trial is above mobile app benchmarks, and we are seeing excellent conversion to paid subscribers – both among our 90-day free trial sign-ups from April, as well as our 14-day free trial sign-ups from May and June.”
With about $1.75 billion in start-up capital, Katzenberg’s company has nurtured grand ambitions to redefine the streaming space and customers’ relationship with their mobile devices. It set deals with an array of A-list creators, from Steven Spielberg to Reese Witherspoon to Guillermo del Toro and many more, allowing talent to reclaim rights to shows after an initial run on Quibi.
An early target for the short-form service was 7.4 million subscribers within the first year, a number that has been revised downward. COVID-19 has presented a challenge, with target users stuck at home during the spring and many cities across the U.S. far from their previous, bustling incarnations, altering the on-the-go use case for Quibi. (Skeptics point to healthy mobile viewership of TikTok, Snapchat and YouTube during the pandemic.)
Katzenberg and Quibi CEO Meg Whitman have insisted the company has operating capital to see it well into 2021 and noted that advertising inventory has been sold out. But ad buyers have sought to renegotiate terms based on the soft opening numbers and the company has also been nagged by a legal battle with Eko over alleged intellectual property theft related to its Turnstyle interface.
With so many viewers stuck at home in recent months, the living room is becoming a major battleground as Apple TV+, Disney+, Peacock and HBO Max do battle with Netflix, Amazon and other incumbents. Quibi did not initially offer viewing on TV screens through connected devices, but it has fast-tracked plans to offer that option.
In an online keynote appearance last month at Series Fest, Katzenberg told Liberty Global CEO Mike Fries (one of Quibi’s investors) that the company had run smack into COVID-19 like a “cement wall.” But the soft early numbers, the “silver lining” of the sluggish start, Katzenberg said, “is that it’s actually given us the opportunity to have almost a beta. … We have actually now seen so many aspects of the content, about what is working for them, what is most appealing to them, where our weaknesses are. All of that is being retooled.”
The Sensor Tower numbers were first reported by The Verge.