Just a little over three years in the past a few of America’s most notable leisure executives killed off an try and revolutionise smartphone leisure. The ill-fated platform, spearheaded by former Walt Disney chairman Jeffrey Katzenberg and backed with a $2 billion struggle chest, was Quibi. The subscription video app promising bitesize TV content material had a formidable catalogue, with reveals starring Liam Hemsworth, Idris Elba, and Kiefer Sutherland. Nonetheless, inside six months, Quibi was shut down in October 2020 after subscriber numbers struggled. Since then, short-form video has been the area of social video platforms like TikTok, YouTube Shorts, and Instagram Reels. 

So, how did Quibi get it so improper? The business rationale was not ludicrous. Social video had demonstrated a want amongst leisure customers to snack on short-form video content material. Marrying that with massive cash reveals fronted by well-known celebrities ought to have constructed some momentum. Maybe the worth level was too excessive at $4.99 and $7.99 a month for the respective AVOD and ad-free provides? There have been additionally questions on high quality of Quibi’s content material.

For Quibi’s executives, the failure was all the way down to dangerous timing. This was a short-form video app geared toward busy individuals who might eat snippets of drama throughout a busy workday. Nonetheless, it got here amid a world pandemic when almost everybody had further time to binge on long-form video at house. Since its closure, a market consensus has developed that Quibi’s failure was really all the way down to its core use case. Put merely, leisure customers need short-form social content material however they don’t want short-form TV reveals, motion pictures, and documentaries. Regardless of how well-executed Quibi was, it was all the time doomed to fail.

This view is now being challenged within the ad-supported house. Earlier this 12 months (2023), a development emerged the place video pirates and leisure firms alike started chopping up episodes of fashionable reveals like Gray’s Anatomy and South Park earlier than publishing them on TikTok. Paramount went a step additional in October 2023 by releasing the entire Imply Women film totally free on the Bytedance-owned platform. Because of this, the Imply Women TikTok accounts’ following has greater than doubled during the last 30 days to 430,500 as of November twenty ninth. It confirmed that there’s an urge for food for short-form drama on social video platforms. For the time being, it’s a advertising and marketing play that helps leisure firms push social video customers in the direction of their streaming TV providers. Nonetheless, it as soon as once more raises the query as as to whether leisure firms can discover a approach to begin charging for short-form TV reveals.

The correct recipe for short-form TV reveals

Enter ReelShort, the short-form video app that has seen a spike in recognition for its cleaning soap opera content material, accumulating over 11 million downloads on Apple and Android app shops mixed. The smartphone app, owned by the China-based writer COL Group, sometimes splits hour-long TV reveals right into a sequence of one-minute episodes. Not like Quibi, the content material is absent of well-known stars. Exhibits similar to Certain By Vendetta and The Double Lifetime of My Billionaire Husband wouldn’t look misplaced on the Hallmark channel. In an additional departure from Quibi, the app has positioned itself as anti-subscription. In its advertising and marketing materials, ReelShort asks “are you uninterested in paying for subscriptions you don’t actually use?” earlier than providing a number of methods to pay for content material. Customers can watch various episodes totally free, hire or purchase particular person sequence on a pay-per-view foundation, or earn digital cash to buy episodes by watching adverts. Whereas Quibi didn’t adapt to the pandemic, ReelShort has a enterprise mannequin of pay-per-view and ad-funded viewing that’s aimed on the cost-of-living disaster shopper.

Disrupting subscription video on demand

So, who ought to be anxious? Again in September, MIDiA said that YouTube ought to capitalise on the development of huge finances TV reveals being distributed as short-form content material on TikTok. MIDiA’s evaluation was pushed by the flexibleness of YouTube’s supply, from YouTube Shorts to its streaming TV relationships via its Prime Time channels. Because of this, there was a possibility to increase the relationships with its streaming TV companions in the direction of present licencing on YouTube Shorts that might assist drive engagement in the direction of YouTube Premium and its pay-TV supply.

Nonetheless, ReelShort now stands as each a risk and a possibility to Netflix and YouTube. Afterall, YouTube was pressured to fend off the short-form risk from TikTok by launching Shorts. There’s a hazard that ReelShort might change into Netflix’s TikTok second.

Such is Netflix’s dominance that it might not want to cannibalise its month-to-month subscriber base by providing a short-form pay-per-view supply. Nonetheless, the identical argument was as soon as utilized to promoting. Netflix has given some consideration to short-form content material. In March 2021, it mushy launched an in-app service known as Quick Laughs that displayed humorous clips from its roster of flicks and reveals in a TikTok-style feed.

A brand new acquisition funnel

In the end, ReelShort is demonstrating {that a} shopper area of interest pays for short-form TV present content material if the cost supply is correct. Quibi additionally demonstrated this however in the end failed as a result of it tried to shoehorn a conventional subscription mannequin onto an rising media format. ReelShort‘s intention is to show significantly fashionable with cash-strapped youthful customers who’re used to free-to-access social video content material. For streaming TV providers seeking to construct worthwhile companies in these difficult instances, conserving a detailed eye on ReelShort can be necessary. If it succeeds, then the ReelShort enterprise mannequin could possibly be used to entice youthful viewers on the lowest entry level earlier than changing them into paying subscribers when their disposable revenue improves.