Less than three months after mobile streaming service Quibi said it was shutting down, Roku announced plans Friday to acquire the startup’s content.
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Roku will acquire more than 75 shows and documentaries created by Quibi and Hollywood-based studios, the company said in a statement. Quibi’s content includes shows starring actors like Anna Kendrick and Liam Hemsworth, and more than a dozen new shows that hadn’t even debuted on Quibi.
“Today’s announcement marks a rare opportunity to acquire compelling new original programming that features some of the biggest names in entertainment,” Roku’s vice president of programming, Rob Holmes, said in a statement.
Quibi announced its plans to shut down in October, a little over six months after the streaming service launched. The company, which was led by former HPE CEO Meg Whitman and former Walt Disney Studios chairman Jeffrey Katzenberg, was backed by investors including MGM Studios, Alibaba Group and Warner Bros.
Quibi, short for “quick bites,” was meant to be entertainment for people on-the-go. Its programming wasn’t longer than 10 minutes and was made for smartphones.
But the pitch to viewers evidently didn’t land. Quibi officially launched in April, when many people were stuck at home due to the COVID-19 pandemic and had plenty of other streaming options like Netflix and Disney Plus. Few people were on-the-go.
Still, investors had put nearly $1.8 billion in funding to back the project. Quibi’s $750 million private equity round in March was the largest round of funding raised by a company in the media and entertainment space last year, according to Crunchbase data. Its $1 billion venture round—its first round of financing—was the second-largest fundraise by a media and entertainment startup in 2018, behind only ByteDance.
Funding for media and entertainment startups was down in 2020, both in terms of dollar volume and deal count, according to preliminary Crunchbase data. U.S.-based venture-backed companies in the media and entertainment space raised about $6.2 billion in funding last year, down from $8.9 billion in 2019, Crunchbase data shows.
Globally, funding was down from $22.3 billion in 2019 to $12.1 billion in 2020.
The number of acquisitions of venture-backed media and entertainment startups is also down year over year, but the dollar volumes have gone up, both in the U.S. and globally.
It’s important to note that Roku didn’t acquire Quibi itself. After Quibi did an internal restructuring, Roku acquired Quibi Holdings LLC, which holds all of Quibi’s content distribution rights, according to a statement from the company.
The number of streaming services available has increased as more networks have opted to create their own services rather than having their content available on other platforms. Disney Plus and NBCUniversal’s Peacock are among the newer players in the game, and Disney in 2019 also acquired streaming service Hulu.
Financial terms of the Roku-Quibi deal were not disclosed.
Illustration: Dom Guzman
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