By Jon Swartz
LAGUNA BEACH, Calif. — Meg Whitman has seen the future of content — and it’s on a very small screen. And in very short bursts.
Her new venture Quibi, short for “quick bites,” is scheduled to launch in April with shows and films from A-list directors such as Steven Spielberg and Guillermo del Toro sliced into increments shorter than 10 minutes that are meant to be viewed on smartphones.
The short-form streaming service founded by Whitman, the former chief executive of Hewlett-Packard Co., and Hollywood mogul Jeffrey Katzenberg has already booked $100 million in advertising revenue. Whitman, speaking at the Wall Street Journal’s Tech Live conference in Southern California, said the ads were bought by Alphabet Inc.’s /zigman2/quotes/202490156/composite GOOGL +1.14% /zigman2/quotes/205453964/composite GOOG +1.17% Google, Walmart Inc. /zigman2/quotes/207374728/composite WMT +0.42% , Anheuser-Busch InBev SA /zigman2/quotes/209225053/composite BUD -0.11% , Procter & Gamble Co. /zigman2/quotes/202894679/composite PG +0.51% , PepsiCo Inc. /zigman2/quotes/208744353/composite PEP +1.50% and a handful of others.
The full programming slate hasn’t been announced, but the service also will include daily news programming. There are two pricing options: An ad-free service that costs $7.99 a month and a $4.99-a-month option with ads.
“We’re bringing the best of Silicon Valley and Hollywood together to create a different entertainment platform,” Whitman told MarketWatch in a one-on-one interview. “We’re not a studio, but commissioning studios to make content.”
In a separate interview last year, Katzenberg compared Quibi’s master plan to HBO — a place for quality content that breaks all programming barriers. “They blew the walls off of length of content, episodes, standards and practices,” he said. “We want to do the same online. It’s narrative storytelling in bite-sized episodes.”
That’s about the only thing small about Quibi, whose iconic founders are wagering a lot of money — and perhaps their reputations — on the Hollywood-based startup.
Katzenberg has secured $1 billion in backing from major Hollywood players such as Walt Disney Co. /zigman2/quotes/203410047/composite DIS +1.23% and AT&T’s /zigman2/quotes/203165245/composite T 0.00% Warner Bros.. The venture also is attracting investment from Sony Pictures /zigman2/quotes/208567357/composite SNE -0.67% , as well as Alibaba /zigman2/quotes/201948298/composite BABA +0.50% .
“I think it’s the biggest idea that we’ve ever done,” says Katzenberg, who co-founded DreamWorks Animation in 1994 with Spielberg and music giant David Geffen.
Quibi’s play to go small comes as media titans Netflix Inc. /zigman2/quotes/202353025/composite NFLX +2.07% , Apple Inc. /zigman2/quotes/202934861/composite AAPL +3.75% , AT&T Inc., Amazon.com Inc. /zigman2/quotes/210331248/composite AMZN +2.49% , Comcast Corp.’s /zigman2/quotes/209472081/composite CMCSA +0.98% NBCUniversal, and Disney slug it out in the video-streaming market with grander (and more expensive) content, spending billions of dollars in the process.
At the same time, the digital landscape is littered with short-form content from the likes of Alphabet’s YouTube, Facebook Inc.’s /zigman2/quotes/205064656/composite FB +2.12% Instagram, and Snap Inc.’s /zigman2/quotes/205087158/composite SNAP +1.52% Snapchat that is largely free.
This doesn’t mean content from Quibi will come cheap. Its “Lighthouses” premium videos will cost roughly $100,000 per minute to produce, which puts it on par with some of the most expensive shows on TV.