Troubled Quickflix sees further drop in customers, says it lacks marketing budget to compete with rival streaming services
Struggling Australian video streaming and DVD rental company Quickflix (ASX:QFX) has revealed that its number of paying customers has fallen again, while customer trials have dropped by a third in just the last three months.
The company’s quarterly update was put out on the ASX on Friday evening, a time of the week often chosen by companies wanting to slip out bad news.
Shares in Quickflix have been suspended for the last two months while the company attempts to restructure its operations to reduce costs.
According to Friday night’s update,by the end of September, the loss-making company had just $840,000 left in the bank. It said that it has applied for a $620,000 rebate from the government by claiming tax back against research and development, which it hopes will arrive in the coming weeks.
The company said that revenues fell by 8 per cent to $3.9m. But it had also cut its operating costs by 26 per cent to $4m.
The quarter was the second in a row to see a reduction in the number of paying customers which have now fallen to 100,121.
The company said it has been unable to match the marketing budgets of the likes of Netflix, Stan and Presto.
At the beginning of the week, Quickflix said it had cut 20 per cent of its staff as it sought to bring down costs and evolve to a model which mainly involves helping other streaming services market to its customers on an affiliate model.
On the outlook for the company, Quicklflx said: “Competitors are expending enormous amounts of money on marketing and content in a bid to secure market share. Quickflix will not seek to compete head-on in this environment, rather it will focus on developing a niche.”
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TPG should just snap it up… It’s a bargain. streaming deals with studios are in place, as a $10 month add-on package for its existing customer base it’s a no brainer. The Website, apps etc are generally ok (better than stan). Quickflix as a brand is essentially a value operator in the streaming market. And there’s definitely room for one of those.
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to them for continuing to try. but my word, this has been a long, slow and painful death.
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I’d say that the only value quick flix has is probably undermined by strict content agreements that specifically limit their content delivery to DVD and TVOD (transactional video on demand). If they had been able to switch their pricing model to an OTT ( over the top ) delivered SVOD, (subscription video on demand) thus using more competitive and flexible content streaming rights, surely they would have been bought out by another foreign OTT vendor already? Seems like they are stuck with either SD standard definition mail order DVD or a limited tvod library that has to be branded under the quickflix banner. Or simply it was too risky for them to migrate their current DVD subscribers to a streaming subscription. Their niche is that they can supply movies to people that do t have broadband bundles that allow big data sownloads. Then why don’t they put some DVD kiosks into play ? Cost prohibitive? Partner up with bws or liqueur land and enter the DVD vending Machine market even McDonald’s could add a quickflix App to their burger ordering touch screens. Let’s face it the video hire shops have all but disappeared and with data retention now in place there is still a niche market for them to expand and conquer, the late fees alone for a payWave DVD vending machine are going to double revenues. I think the CEO got so sidetracked delving into potential adult film subscription products that he has lost his way. Get your head out of the sand and ask the customers what they want o start with! Give them options and meet their needs. Don’t let this good thing end! We need to share the love and reinvent the wheel to revive Quickflix as a solid Aussie brand! Are we going to stand by and hand over our potentially lucrative locally operated Quickflix company to a foreign SME? So unAustralian, Tpg are Russian and won’t get the rights to stream content, Netflix, Presto and Stan are obviously all riding exclusive patriotic SVOD deals that leave qflix out of the market. Fetch TV and Telstra are not OTT they rely on a clunky set top box, reduce your download bandwidth. Quickflix have their TVOD app already built into in most new smart TVs! They will require you to have a decent data package to download recent releases and don’t have a lot of new releases titles. How This can QFX compete with the new streaming OTT and SVOD products, the base level is surely made up of iTunes and bit torrent users. Wtf is Foxtel doing with Captain Kirk and the starship bundle? Quickflix had better get their card out on the table and see what the customers want! Give us options and make the hard journey worthwhile. Let’s see some fresh market research and get someone in to develop a solid affordable turnkey morph marketing social media campaign to allow us to help save this Aussie grown company and build a legacy for the future of Australian owned video entertainment!
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It’s a reliable service. Correct to state it doesn’t have GoT or similar blockbuster tv programmes. But it does have heaps of other TV content and new release movies which is attractive to many people. Quickflix need to promote themselves on FTA and forget Gen Y.
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Neil, you realise Quickflix have had an SVOD service for years, right?
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Every one keeps binning Quickflix , but it hangs in there. These guys are the main player in the DVD rental market and it is profitable for them, it is the SvOD deals that are the issue and the DVD rental market is still very strong. We live on Sydney’s Northern Beaches and streaming is still very unreliable to the point of nearly stalling during peak download times and then top speeds at others. Occurs on ADSL+2 fixed line into router from street pole , not from router to wi-fi device, so we have given up on streaming movies. Hurry up NBN and GFast .
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They have stopped adding DVDs and BluRays in recent weeks, and are hardly sending out disks at all.
It’s unfortunate because the disk by mail market is the only one they have a chance in – yet by trying to make VOD work they have probably ensured that they will not see xmas.
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Hey Dan,
Yes, I understand that QFX has had an awesome hybrid SVOD, TVOD and DVD product for some time. My rant above about flexible content streaming rights was really based on my own frustration with the current limitations I see with most SVOD products out there. They all seem to all have difficulty creating a competitive product that includes Premium Day and Date (D&D) title releases that don’t rely on the Netflix quantity vs quality model; Obviously the studios push us to create long tail business models for our SVOD products with an abundance of older content that still has to force us to Pay more to watch D&D content. I guess the point of demarcation here is with company funded production titles such as House of Cards or Narcos on Netflix. I guess what people want is a premium new release SVOD product but the closest thing is always going to be Foxtel as clearly they’ve got the most eyeballs on subscription. I know it’s very difficult to get Online rights to stream any recent release content at a price point viable for inclusion in an SVOD library; especially if you don’t have the existing customers. Still, I don’t think anyone really does that well, even Foxtel charges for recent releases. I guess that’s why people either torrent or Pay to View any decent recent release content at home. We are all caught in a content trap based on our relatively small consumer footprint here in Australia. People know they can easily get recent content but with the new data retention laws perhaps they are starting to realise the moral position we face in having to pay upfront for every new release on top of our trending OTT back catalog subscriptions.
Re: QFX SVOD product:
“Subscription streaming allows you to stream selected movies and TV shows at no additional charge to your subscription fee. Premium movies and Premium TV can be purchased separately, they are not included in a subscription.”
source: http://tinyurl.com/nzqgcyp
P.S: Anyone interested in doing a VR Vod product ? I’m pretty sure Zuckerburg is onto something with his recent Oculus buy out. Samsung are doing interesting commisions too, check out this recent VR video in a chrome browser shot by a local Aussie production company. https://www.youtube.com/watch?v=7gjR60TSn8Q&feature=youtu.be
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