Streaming service Quibi is exploring several strategic options including a possible sale, according to people familiar with the situation, as the company founded by Hollywood mogul Jeffrey Katzenberg struggles to sign up subscribers in a competitive online-video marketplace.
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Quibi, which launched its short-form, mobile-focused video service in April, is also considering raising more money or going public through a merger with a special purpose acquisition company, or SPAC -- essentially a blank-check company that helps fund deals, the people said. Quibi is working with advisers to review its options.
The review process is a sign of strain. Quibi has struggled to meet its subscriber targets after making its debut in the throes of the coronavirus crisis. The company is on pace to miss its initial paid subscriber target by a large margin, according to a person familiar with the matter. Quibi is also facing a patent lawsuit backed by a deep-pocketed foe and has disappointed advertisers with its lower-than-expected viewership.
Quibi declined to comment on whether it is pursuing a strategic review. "Quibi has successfully launched a new business and pioneered a new form of storytelling and state-of-the-art platform," a company spokeswoman said in a statement. Mr. Katzenberg and Chief Executive Meg Whitman "are committed to continuing to build the business in the way that gives the greatest experience for customers, greatest value for shareholders and greatest opportunity for employees," the statement said.
There is no guarantee Quibi will pursue any of the options it is reviewing.