Quibi in Trouble

DLD said:
I have a hunch that the studio investors put up an "investment in kind", where they provided programming at little or not charge and might get their product/ion back in lieu of cash. Which would depend on the contracts with the investors.
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"Entertainment companies that invested in Quibi got sweetheart arrangements known as "round-trip" deals -- their investments were essentially paid back to them by producing Quibi programming." (CNET)

"Quibi doesn’t own any of the big-budget premium content for which it has shelled out upwards of $100,000 per minute. The company has seven-year licenses on its short-form series; after two years, content owners have the right to assemble the shows and distribute them elsewhere."

"Katzenberg pitched a sale of the company — which has about 500,000 paying customers — to Apple, WarnerMedia and Facebook but was rebuffed ... [and] NBCUniversal was 'put off by the fact that Quibi doesn’t own many of the shows it puts on its platform'." (Variety)

So this funding model was a bit of a double-edged sword. It almost certainly contributed to Quibi's ability to raise nearly $2 billion of funding in a relatively short period of time, but also meant that if things went south, the company was likely to fold as it had few valuable assets of its own.
 
I’m guessing a percentage of folks get motion sickness watching screens with action on their commute. Seemed unappealing to me for all the reasons others have mentioned. Seemed like an answer in search of a problem. Lots of very successful people think they Poop out gold nuggets of ideas (especially in entertainment). The reality is in most cases they plugged into an established business model and thrived but not by creating a new industry Model.
 
davedv said:
... So this funding model was a bit of a double-edged sword. It almost certainly contributed to Quibi's ability to raise nearly $2 billion of funding in a relatively short period of time, but also meant that if things went south, the company was likely to fold as it had few valuable assets of its own.
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It's all going to get written off. It's one of those "our lawyers and accountants told us to say this". That's why Katzenberg struck out in his attempts to resell those rights and the already existing content. But then one has to wonder how earnest his attempts were to begin with. It almost looks like he was obligated to the financial backers to do that, though mostly for the sake of appearance. "Fiduciary responsibility" and all that. Or "going through the motions", if you will. The same thing.

PS. I should have searched further but was curious about the exposure for the pure money players. Depending on how contracts were stipulated, they should have a claim against the in-kind investors/content providers. Which is why it's all going to be gone, at least, on paper. There's no need to pay lawyers more than absolutely necessary. Write it all off and move on. The only problem will remain with the content creators and/studios who signed talent to long term contracts. Then the money guys/gals will say, "Wait a minute, you have given so-and-so a $50M contract to make stuff for yourself but you paid them from our funds in one year that it would taken three years otherwise. We want two years back".

Oh, ya. A lot of filings, a lot of paperwork. Bankruptcy lawyers will be building an additional wing to their mansions.

lambert said:
I’m guessing a percentage of folks get motion sickness watching screens with action on their commute...
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I know I do. I rarely even read anything when on a plane and that's as subtle a ride as you get. The late Amar Bose (of the "no highs, no lows, must be Bose" fame) began to work on the electromagnetic shock system for automobiles in the 1980's. Delphi, then owned by GM, came out with the actual product called "MagneRide" first implemented on a 2003 Cadillac Seville STS. Corvette got it the next year. Porsche came out with PASM in 2005. Rolls Royce has a the "Magic Carpet Ride". That one, allegedly, is the smoothest.

Or one can buy an audio book instead.

PS. Delphi went bankrupt in 2005. The law suits continued for the next half a decade, at least. Katzenberg better hope that his books are in order, which isn't always the case in Hollywood. (or, really, never the case). Because someone will invariably claim "poor faith/fraud" just so he can go after Whitman's and Katzenberg's personal assets. Which are much more substantial than Quibi's.
 
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