Jeffrey Katzenberg's Quibi is courting big brands like P&G and Anheuser-Busch, seeking upfront ad deals for the streaming platform

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Hollywood exec Jeffrey Katzenberg

• Hollywood exec Jeffrey Katzenberg's yet-to-be-launched mobile streaming video service, Quibi, is courting several big name advertisers to secure upfront ad deals.
• The company's executives are in conversations with at least four big brands, including consumer packaged goods giant Proctor & Gamble and beer maker Anheuser-Busch InBev, multiple sources confirmed to Business Insider.
• While Quibi was first asking for an upfront ad commitment of $25 million, that figure has now whittled down to the $8-$10 million range, a source told Business Insider.

Hollywood exec Jeffrey Katzenberg's yet-to-be-launched mobile streaming video service Quibi is courting several big name advertisers in a bid to secure upfront ad deals.

Quibi is seeking commitments from both media agencies and brand marketers, Digiday first reported. The company's executives are in conversations with at least four big brands, including Proctor & Gamble and Anheuser-Busch InBev, multiple sources confirmed to Business Insider.

Quibi did not respond to a request for comment from Business Insider.

While Quibi was first asking for an upfront ad commitment of $25 million, that figure has now whittled down to the $8-$10 million range, a source said. Business Insider was unable to confirm the CPM - or the cost per 1,000 ad impressions - that Quibi is quoting, but one source familiar with the CPM said it was "very high," while another one called it "outrageous."

Quibi is gearing up for an April 2020 launch with a focus on subscriptions. It has two different subscription tiers: a $5 ad-supported subscription version, and an $8 ad-free version. Tim Connolly, the company's head of partnerships and advertising who was recruited from Hulu, is leading the charge to recruit advertisers on the former, per two sources.

Business Insider does not know of any contracts or deals that have yet been finalized, and Quibi is still in active negotiations with a number of big name brands, multiple sources said. According to a deck obtained by Digiday in December 2018, advertising could account for anywhere between 24.9% to 30% of Quibi's revenue, depending on the number of subscribers it is able to get.

If P&G does indeed sign on the dotted line, it will not be the first investment it makes toward a streaming platform. Just last week, P&G released two documentaries for Queen Collective in partnership with Queen Latifah, which were made exclusively available on Hulu.

While Katzenberg is an industry veteran, and has connections and talent on board Quibi already, some advertisers remain skeptical of its chances of success. They question whether consumers will actually have an appetite for premium, mobile-first video content, a source said, and are also concerned about ad formats on such a platform - most advertisers don't readily invest in six-second ads, for instance.

An entertainment exec said he was "skeptical" of whether the platform would be successful, while a media agency exec said that one of the agency's biggest clients had been approached by Quibi, and had "sticker shock."