Popculture Deathcart: Streaming Wars Casualties
Man down!
We have a fatality in the Streaming Wars. Quibi is shuttering operations.
Unfallen Darklings: What the fuck is Quibi?
TDH: A good question. And sadly, one that Quibi never actually had an answer to. Although it did have other things.
It certainly had lots of investors; Disney, Warner, Paramount (but NOT, it should be noted, Netflix).
It had 1990s Disney wunderkind Jeffrey Katzenberg in charge.
And it had original content
But like I said, it didn’t really have an answer to the question, what is Quibi? It is (or rather was) a subscription service that provided “quick bites” of entertainment. They were downloadable. So, in theory, you could download a few and watch them while you were sitting on a bus headed to work.
Brilliant idea!
Assuming everyone in America uses public transportation.
For me, it’s only useful if I want to go into a ditch every morning. Which I don’t. I suspect the view was that it would find its market somewhere between Tik Tok and YouTube. But instead of Screaming Karens and Sneezing Kittens it would have professionally produced content and therefore be professionally entertaining. Basically, it was a project with a great deal of capital and enthusiasm but no solid idea of what it wanted to be. Admittedly, YouTube started out the same way… And it still hasn’t made a profit.
Shockingly, Katzenberg says that he will be returning the remaining funds to the investors. Okay, this never happens so either he’s not doing things right or the whole thing was some kind of scam from the start.
NEXT
AT&T just had a brutal Q3 earnings call. Not as bad as Disney’s Q3 was or their Q4 is going to be, but it was pretty freaking bad. They are down nearly a billion dollars and there is only one major subsidiary responsible for that crater in the spreadsheet; Warner Media. The billion-dollar game of Three Card Monty that is the 21stCentury entertainment complex found a whale, in Ma Bell.
Admittedly, AT&T wasn’t quite in the position of being the guy who got into Dinosaurs inc. Just as the smart money got out. The asteroid that was coming wasn’t obvious. But that said the entertainment industry was over specialized and had bred in weaknesses that were apparent before the impact. Any big change in the environment was going to leave a lot of Tyrannosaurs trying to live on a diet of too few rats.
The multi-plex theater exhibition model wasn’t healthy before the crisis. * Streaming was clearly the future but to make a go of that you need both a deep back catalog and big, healthy franchises. Right now, nobody has one (Disney thinks it does with Marvel but the truth is that train left town with Tony and Steve).
Regardless, Warner Brothers clearly and obviously didn’t have any healthy franchises, when AT&T bought them.
Harry Potter? Nah, that ended with the Deathly Hallows part II back in 2011. Fantastic Critters in a Suitcase didn’t take off. Nolan’s Batman was huge in its day, but that day ended in 2012. The DC-verse has been wallowing in a swamp ever since. At $650 million Justice League wasn’t quite a flop but when you are expecting $2 billion it’s no reason to dance in the aisles either. They’ve had a few hits since then, but they have no formula for repeating those successes.
The only other thing they’ve tried to push is their Kaiju series; The Monsterverse. Godzilla King of the Monsters did $380 million against a budget of $170 million. Which means it didn’t lose money but again, no dancing in the aisles. That series is likely dead.
Those are the only big names Warner Brothers had. Bugs Bunny ain’t packing them in anymore.
The subsidiaries are all struggling as well. Rooster Teeth is in trouble. Crunchy Roll is up for sale. DC Comics has been gutted and the rumor is that they are getting one more chance at turning a profit and then they will be shuttered and the characters licensed out.
Never mind all of that! Streaming will solve everything. And there is no denying that HBOmax had an impressive launch.
From Variety:
AT&T touted the growth of WarnerMedia’s HBO Max premium streamer, with activations more than doubling in the third quarter to 8.6 million. All told, 28.7 million customers were eligible to get HBO Max at the end of Q3.
As of the end of September, HBO and HBO Max subscribers in the U.S. together reached 38 million, exceeding the company’s initial year-end target of 36 million. The numbers show HBO/HBO Max combined had a net gain of about 1.7 million subscribers in Q3.
There’s a caveat: In its overall HBO Max number, AT&T rolls up all subscribers who are eligible to get it — even if they haven’t watched it. With total “activations” of HBO Max at 8.6 million, that means 70% HBO’s existing subscribers who have access to HBO Max for no extra charge still have not signed in to use the super-size streaming service.
So, 70% of HBOmax’s “customers” haven’t ever used HBOmax. The massive launch looks very much like another shell-game.
Unfallen Darklings: But I can still get Harry Potter movies?
TDH: If you go with Peacock, sure! Apparently, Ma Bell didn’t know that Warner Brothers had sold the streaming rights to Universal when they bought Warner. That license expires in 2025.
Warner Media hasn’t made any money for its owner since March of this year. The WB is in the unenviable position of having no plan B. The theaters were dying, to begin with, if they don’t make HBOmax a success, AT&T will have to either sell Warner Media off at a loss or just cut it loose, so it isn’t losing any more money for them.
See you Monday.
*I’ll post on that next week sometime.
