Quibi Holdings LLC is shutting down a mere six months after launching its streaming service, a crash landing for a once highly touted startup that attracted some of the biggest names in Hollywood and had looked to revolutionize how people consume entertainment.
The streaming service, which served up shows in 5- to 10-minute “chapters” formatted to fit a smartphone screen, has been plagued with problems since its April debut, facing lower-than-expected viewership and a lawsuit from a well-capitalized foe.
“Our failure was not for lack of trying,” founder Jeffrey Katzenberg and Chief Executive Meg Whitman said in an open letter to employees and investors. “We’ve considered and exhausted every option available to us.”
Mr. Katzenberg and Ms. Whitman decided to shut down the company in an effort to return as much capital to investors as possible instead of trying to prolong the life of the company and risk losing more money, according to people familiar with the matter.
Employees will be laid off and will be paid a severance, the people said, and Quibi will explore selling the rights to some of its content to other media and technology companies.