Streaming Giant Roku Considering Acquisition of Failing Service Quibi
Ups and Downs for Roku's Acquisition of Quibi's Content
Remember when Quibi, the shiny new toy in on-the-go video, fizzled out after a measly six months in 2020? Well, the streaming service's misfortune turned out to be another company's gain, with Roku scooping up Quibi's vast library of content in early 2021. Here's the lowdown on how that's shaken out.
In a recent article by The Wall Street Journal, Roku is reportedly in "advanced talks" to acquire Quibi's substantial content catalog, including popular series like Murder House Flip. Though financial details are still murky, Quibi supposedly has around $750 million in cash, with around $350 million set to be returned to investors and an undisclosed amount reserved for employee severance and outstanding production agreements.
Roku, aiming to beef up its ad-supported Roku Channel, could potentially capitalize on the acquisition as a splashy marketing opportunity. The company hopes that owning popular Quibi content will bolster its clout in future talks with media companies.
The acquisition has already been finalized, with Roku shelling out substantially less than $100 million for the assets. The acquired content, now renamed Roku Originals, is now accessible through The Roku Channel, which is available in the U.S., the U.K., and Canada.
Since May 2023, The Roku Channel has begun rolling out its first batch of Roku Originals, featuring 30 shows originally produced for Quibi. The plan is to continuously release more content from the Quibi library throughout the year, including a dozen unreleased series.
By acquiring Quibi's highly-produced content, the Roku Channel aims to enhance its appeal to a wider audience, diversifying its programming beyond what was previously available. Because the content will be available for free on an ad-supported model, it's expected to boost user engagement and attract advertisers, ultimately contributing to Roku's revenue growth.
However, Quibi faced numerous hurdles in its short lifespan, notably launching amid the pandemic when people spent significantly less time commuting. By the time Quibi introduced an app for viewers to watch shows on their TVs, it was already too late.
Despite its tumultuous history, Quibi's content might still pique the curiosity of viewers seeking a taste of the strange phenomenon that was the Fyre Fest of streaming services. But in truth, we're mainly dealing with a collection of high-production-value YouTube clips, and the question remains whether it'll have staying power in the long run.
Insights:
- Roku's acquisition of Quibi's content is part of its strategy to bolster its position in the streaming market by offering a more diverse range of content to viewers.
- The addition of Quibi's content provides a significant expansion of Roku's offerings and has the potential to attract more viewers to the platform, enhancing its appeal by catering to a broader audience.
- Due to the content being available for free on an ad-supported model, it could boost user engagement and attract advertisers, contributing to Roku's revenue growth.
- The first batch of Roku Originals debuted on May 20, 2023, and more content will be released throughout the year, including previously unreleased series.
- Unlike its brief existence, Quibi's content found a new life in 2021 when Roku acquired it, offering a diverse range for its ad-supported Roku Channel.
- In 2023, Roku unveiled the first batch of Quibi's content, renamed as Roku Originals, aiming to attract a wider audience and boost user engagement.
- As Roku continues to roll out content from Quibi's library, it hopes to capitalize on its high production value and use it as a splashy marketing opportunity in future talks with media companies.
- Although Quibi faced numerous hurdles in 2020, its acquired content in 2021, under Roku, is not just a curiosity but could potentially contribute to Roku's revenue growth through increased user engagement and advertising.
