28 Jun 2020
Posted in Technology
COVID-19 had some impact but other issues hound HBO Max and Quibi, says GlobalData
Pandemic or no pandemic, HBO Max and Quibi were committed to launch in Q2 2020. At first glance, this should have been the perfect time to showcase a new streaming service to customers who were in lockdown. However, the streaming platforms had other issues, besides COVID-19 challenges, which led them being ill-prepared for launch, says GlobalData, a leading data and analytics company.
Tammy Parker, Senior Analyst at GlobalData, comments: “GlobalData expects that the US subscription video on demand total market revenue will increase by 25% to $30.4bn in 2020. Eager to grab their share, HBO Max and Quibi both rushed to market, meaning some features and offers had to be prioritized to meet self-imposed launch deadlines. Many deficiencies in these nascent services could be remedied post-launch, but the services lost some momentum by coming to market before being fully developed.”
COVID-19 has impacted both services’ rollout plans. In the case of HBO Max, the service would have benefitted from an earlier launch during Q1, when society was deeper in the throes of pandemic lockdown. Either way, HBO Max’s content line-up would have taken a serious hit from COVID-19 due to production delays caused by government-required lockdowns. Quibi’s business model relies upon a more mobile society, so any pandemic-timed launch was not in its best interests. However, Quibi’s issues run much deeper than just COVID-19 lockdowns.
Parker continues: “Both have missed opportunities for more customer touchpoints via TV viewing, with HBO Max rolling out minus support for Roku or Amazon Fire TV devices and Quibi not offering casting from mobile phones to TV at launch. Other desirable features are also missing from these services at launch. The role of HBO Max alongside those of HBO GO and HBO NOW remains muddled, and Quibi’s entire business model is looking questionable.”
Initially, it appeared that the biggest issue impacting Quibi’s introduction was the sudden COVID-19 lockdown that kept people at home, disrupting Quibi’s original business model of offering ‘quick bites’ of content to people on the move. However, Quibi actually stood to gain from social distancing guidelines because many people watch video on mobile devices while at home. Apps such as Snapchat and TikTok gained more engagement than normal while tight lockdown orders were in place. Therefore, Quibi’s slow uptake during the pandemic is due mostly to a lack of compelling content.
Parker concludes: “Both HBO Max and Quibi have lots of work ahead. Despite its missteps, HBO Max has plenty of opportunities to make good on its vision. Necessary distribution contracts can be negotiated and signed, delayed shows will start production, the planned ad-supported version will attract new users and HBO Max will eventually be the one streaming service offered by AT&T/WarnerMedia.”