The Convergence of Entertainment and Subscription Models: How TikTok Thrives and Quibi Struggles

The Convergence of Entertainment and Subscription Models: How TikTok Thrives and Quibi Struggles

Introduction:
In the digital age, successful mobile video apps are not just about the viewing experience; they are about creating social experiences. This article explores the concept of the Entertainment Value Curve and how it relates to the success of platforms like TikTok and the struggles of Quibi. Additionally, we will delve into the emerging trend of restaurants offering subscription services during the pandemic.

The Entertainment Value Curve:
On mobile, entertainment value is the result of combining production value and social value. The formula Entertainment Value = Production Value + Social Value creates an efficient frontier of product/market fit. Social value is determined by the level of personal connection the viewer has with the content, while production value refers to the quality of the content relative to the highest quality in its genre.

Different Platforms, Different Points on the Curve:
Various mobile video platforms occupy different positions on the Entertainment Value Curve. Snapchat, for example, places a strong emphasis on social value, allowing anyone to create fun content with low production value. Instagram, on the other hand, has increased its entertainment value by lowering the production bar and making lower-quality content readily accessible. TikTok takes this a step further, reversing the emphasis and prioritizing topical content first, followed by socially connected content. Netflix, at the other end of the spectrum, focuses on high production value, catering to elite Hollywood creators.

Social Value and Production Value by the Numbers:
The creation participation rate, which measures the percentage of users who create content, is an important metric for determining social value. Instagram has successfully increased creation participation through features like IG Stories, which lowered the bar for what is considered "Instagram-worthy." In terms of production value, platforms with high production value tend to have shorter content distribution tails, while those with low production value have longer tails.

The Quibi Misstep:
Quibi, despite its promise as a disruptive and timely idea, failed to optimize its product for the Entertainment Value Curve. By imposing constraints on format, length, and viewing, Quibi limited its ability to compete with the high production value of Netflix content without supplementing it with increased social value. Quibi wrongly assumed that "short" was the desired feature, overlooking the importance of shareability and social connection.

TikTok's Success:
TikTok recognized the power of snackable media as social media. By allowing 15-60 second clips to loop infinitely, TikTok made it easy for users to share content with others. The platform also breaks down the wall between the audience and the creator, encouraging authentic sharing and leveling the playing field for new creators. The TikTok algorithm further enhances social value by giving new content a chance at virality.

The Subscription Model in the Restaurant Industry:
Amidst the pandemic, restaurants have turned to subscription models to survive. Dickey's Barbecue Pit, Panera Bread, Burger King, and Cumberland Farms have all experimented with subscription services, offering unlimited coffee or meat boxes for a monthly fee. These models have garnered significant interest, with over 55 percent of New Yorkers expressing willingness to subscribe to their favorite restaurants. However, the long-term viability of this model remains uncertain.

Conclusion:
In conclusion, the Entertainment Value Curve highlights the importance of balancing production value and social value in mobile video apps. TikTok's success lies in its ability to create a social experience through snackable, looped content and a level playing field for creators. Quibi's failure serves as a cautionary tale of overlooking social value in favor of imposed constraints. In the restaurant industry, subscription models have provided a lifeline during the pandemic, but their sustainability in the long run is yet to be determined.

Actionable Advice:

1. Embrace snackable content: Consider creating short, looped content that is easily shareable to enhance social value.
2. Lower the production bar: Find ways to make content creation accessible to a wider audience, allowing for increased participation and connection.
3. Prioritize social value: Focus on fostering genuine connections between creators and viewers through features that encourage conversation and sharing.

By understanding the dynamics of the Entertainment Value Curve and the potential of subscription models, businesses can adapt and thrive in the ever-evolving digital landscape.