CEO Doesn't Know if MoviePass Will Offer a Movie Per Day Plan Again (engadget.com)

The subscription service famous for supplying a movie ticket per day for just $9.95 a month hasn't been offering that wildly popular package since April 13. From a report: The company's too-good-to-be-true offer of one movie per day for $10 subscription model brought it 500,000 subscribers in one month, but MoviePass' finances show that the startup is struggling while still being dogged by its CEO's comments around tracking his customers. Recently, the company downgraded its available new subscriber plans to a three-month, $30 "limited time" offer that includes four movies per month and a three-month trial of iHeartRadio premium. It seems as if this offer now has no limit; CEO Mitch Lowe told The Hollywood Reporter that he was unsure if the movie-per-day plan would even return as an option. "Do you think you will go back to a movie a day?" a THR reporter asked Lowe at CinemaCon in Las Vegas. "I don't know," he responded.

Comments

I’m shocked!

[Lunix Nutcase]

So what you’re saying is that something too good to be true on paper as a business model was actually too good to be true? Shocking!

Re:I’m shocked!

[whoever57]

More shockingly, this company with no real business plan isn't based in California!

Re:I’m shocked!

[Anonymous Coward]

Funny how California businesses brings in more money than all businesses in every other state combined.

Re:I’m shocked!

[Anonymous Coward]

I had one of these prized "$9.95/mo, movie every day" plans before they were discontinued for new subscribers. Cancelled last month. I went to a movie every day for a while, then I found that Hollywood doesn't actually have that many good sci-fi movies to offer me at all. (With a few exceptions.) There might be 1 sci-fi movie per month. Is it worth me wasting my time seeing other "barely interesting" movies of other genres? Not really, as it turns out. Netflix is better, theaters are a dying model, lots of people have large screen TVs in their homes these days.

Re:I’m shocked!

[rally2xs]

Hmmm... lotsa good flix, tho. And a few sci-fi to make it worthwhile. There was Maze Runner, Annihilation, Rampage (yeah, its an action flick too...), Pacific Rim (stupid, just use shore batteries), Ready Player One, Geostorm, Planet of the Apes series, Valarian and the City of a Thousand Planets, Guardians of the Galaxy 2, Colossal (maybe more fantasy than sci-fi), Arrival, The Space Between Us, Rogue One, Independence Day, Looper, and The 5th Wave, all within the last couple years.

Re:I’m shocked!

[Anonymous Coward]

I'm shocked!
Shocked!
Well, not that shocked...

Re:I’m shocked!

[ripvlan]

I'll bet that was an assumption of the plan. Most people don't have time or interest in movies to go "every day" -- so you end up going every other month. And this allows them to make money.

But of course, as with any new toy, we use it like crazy for the first few weeks. And that costs them money and apparently on a losing scale.

Re: I’m shocked!

[Anonymous Coward]

You haven't named 1 good movie. Every movie you named fucking sucked.

Jesus Christ, half the shit you listed is rehashes. Nothing new. Enjoy your movies. LUL

Re: I’m shocked!

[Anonymous Coward]

If you don't like his examples, fucking name a few of your own!

Also, you need to learn the difference between "this movie sucks" and "this movie isn't to my taste".

No appeal

[SuperKendall]

The deal was great if you wanted to go see what was playing. But since there's almost nothing I want to see I decided to pass on it.

Re:No appeal

[Riceballsan]

if I recall their business model is just plain stupid... take $10 a month from users... pay a $10 movie ticket for them up to 30 times a month out of pocket. In the hopes that the movie theatres are happy with the increased business and possibly set up an arrangement that isn't them losing 30x what they make. To me it's a pretty silly business model.

Re:No appeal

[godrik]

The business model was really a bit more complicated than that. You could start pressuring some theater to give you a better price, or you won't send your traffic there.
But it sounds almost impossible to pressure big chains, which is where the expenses are going to be.

Re:No appeal

[fahrbot-bot]

... their business model is just plain stupid... take $10 a month from users... pay a $10 movie ticket for them up to 30 times a month ...

Sure, but are there really 30 movies you -- hell, anyone -- would want to see every month? Perhaps, in a really good month, there are maybe 4 I would consider seeing and that certainly doesn't happen every month - or even most months. Also most people are at work 5 days a week.

The business model relies on the practical matters that (1) there aren't that many movies to watch and (2) most people won't be available to watch them anyway, but it *sounds* like too good deal to pass up so, like a gym membership, (3) people sign up and never, or minimally, use the service and (4) subsidize other people's use. Along with (5) MoviePass selling user data,

Re:No appeal

[godrik]

Sure, but are there really 30 movies you -- hell, anyone -- would want to see every month? [...] Also most people are at work 5 days a week.

Enter teenager.

Re:No appeal

[SuperKendall]

I think that's a great point, they relied on not many people using it then making more off subscriptions and user data sales. The old adage of "if you are not paying for a service, you are the product" really kept me well clear of MoviePass.

Re:No appeal

[I4ko]

Well, if the theater is playing Korean, Spanish, French, Italian, Chinese and Japanese movies, there may be close to 15 a month I would want to see.

Re: No appeal

[Anonymous Coward]

Considering how few people are in the theater when I'm watching a film, if the theater gets even a quarter the ticket price that would be a significant win.

Movies are grossly overpriced for what you get. In terms of movie pass, there just aren't enough movies to make it worthwhile.

Re:No appeal

[eclectro]

Where are you going to get your SJW indoctrination done now, though???

Re:No appeal

[rally2xs]

Or the retired. Me. I'm a big movie fan anyway, and generally see almost everything. I got the 1-year subscription because I figured this would happen. I've had the card about a month, it cost me $105.35, and I've already got my fee back in the equivalent saved movie ticket prices, even tho I get the $8.50 senior price.

We're entering a time when its less lucrative, the summer, when the big movie providers only provide 1 movie per week. OK, will buy them too. Am going to enjoy the next 11 months, and may or may not renew with Moviepass. Probably, if they still have a single price for 4 movies per month.

Re:No appeal

[AuMatar]

The theaters have little ability to reprice their tickets, due to deals with the studios for ticket sales.

Re:No appeal

[AuMatar]

But repayment time was 1 movie. I bet there always 1 movie per month you'd be willing to see some evening when bored. If you live in some areas (Silicon Valley, NYC) a ticket is closer to 20 and one movie a month was a 100% gain. If they had been say $50 a month for up to 1 a day it would have possibly made money. At $10 it was too cheap.

Re:No appeal

[Anonymous Coward]

I can confirm (#3) - I've had the card for almost 3 months and haven't seen a single movie with it.

Wondering who's the idiot now...

Re:No appeal

[tlhIngan]

The business model was really a bit more complicated than that. You could start pressuring some theater to give you a better price, or you won't send your traffic there.
But it sounds almost impossible to pressure big chains, which is where the expenses are going to be.

Which means they not only didn't have a business plan, they didn't even do their due diligence and do basic research.

First, most of a ticket's price - anywhere from 50-100% (100% on opening weekend, 50% after a month or so) does not go to the theatre - it goes to the studio. Theatres absolutely cannot reduce ticket prices because of the studio's take. Even when the take lessens, the patronage has shrunk significantly that the theatre portion pays for operational expenses.

On release weekend, the theatre gets its money from concession sales - pack in the theatres mean the few that buy stuff will pay for the operational expenses.

Perhaps instead of paying for the ticket, they should've paid for the concessions as well - for $15 a month you get tickets and a bag of popcorn (which can cost $7-10), a drink, etc. Which can be $25 of value. And the chain will probably charge you $10 for the ticket plus a buck for everything else.

Re:No appeal

[Anonymous Coward]

That wasn't the business model. No, the model is the same for most startups these days - come up with a clever idea, get greedy VC people to give yoi millions of dollars, sign up lots of customers no matter how much cash you burn through, get more VC have a billion dollar IPO, cash out, and finally leave some other poor suckers holding the bag.

Re:No appeal

[Anonymous Coward]

If I had the time, I'd go watch Black Panther 30 times in a month.

When each of the Lord of the Rings movies came out, I took off the Friday of those weekends and watched each one over and over again. I only managed four viewings a day because the movies were like 3 hours each and the threater wasn't open more than that.

Re:No appeal

[torkus]

Guess what? Your use case isn't exactly the same as everyone else's!

What if those movies didn't cost you any money? What if checking out that odd titled movie your friend randomly mentioned was a matter of just stopping in and seeing it...and leaving if it sucks with no hard or cost? BC that's what moviepass also is.

Some people (particularly younger ones and diehard fans) will see movies multiple times. There certainly ARE movies to watch. They might not all be great, but when the ticket price is zero there's much less motivation to wait for DVD.

You're also not correct about their business model. They've already announced that a large portion of their members see 1-2 movies a month so not a huge loss. Most people DO have time to see several movies a month if they want and comparing it to a gym which most people view as suffering, not enjoyment is ... well worse than a car analogy. Plus by reducing their price for a while their customer acquisition cost fell from ~$50/user to effectively zero...which is largely do to the heavy users getting their friends to sign up. So even the 'costly' users are actually paying for themselves in terms of overall subs.

Re:No appeal

[torkus]

It used to be $50-60/month for the service about 6 years ago when it was new. I know, I had it. It was also quirky, didn't have the app, and didn't work all the time. But even then it was a deal if you lived somewhere expensive like I do (NYC). However, back then I wound up ditching it because the movie cost vs sub cost wasn't a big difference so there was little benefit unless I committed to 5+ movies every month.

I'm pretty sure this round of pricing was basically to make their name, get their subs, and cement their position in the industry. From what they've said, many people with MP are only seeing 1-2 movies a month anyway so the new plan doesn't impact them.

I don't think their plan is to make money from straight sub vs. ticket cost, but instead to have the leverage to negotiate with studios, theaters, and the like to help drive movie attendance. After all, the theater makes little to no money off your admission ticket and the vast majority from concession sales. Other than having to give up control, they don't care what happens as long as something drives lots of viewers to their theater.

Re:No appeal

[Anonymous Coward]

You know you aren't obligated to see a movie every day, right? Hell if you go see 2 movies a month it's a good deal.

I signed up when they first offered the $10 a month for unlimited price and the worst month I've had, i broke even.

I'm a night owl anyway so I go see movies after my kids go to bed, which I can do any day of the week.

Re:No appeal

[Anonymous Coward]

Only reason I didn't do the 1-year subscription is I'm not sure the company will be around that long

Re:No appeal

[fahrbot-bot]

Some people (particularly younger ones and diehard fans) will see movies multiple times.

So much for that ... MoviePass Changes TOS To Prevent You From Seeing the Same Movie More Than Once

Re:No appeal

[Anonymous Coward]

The solution to this is regional pricing. If movie theaters can do regional pricing, why not MoviePass? You live in an expensive city, you're gonna pay tons of money for MoviePass.

only part of the story

[Anonymous Coward]

Knowing how telephone a nd cable companies work:

" the company downgraded its available new subscriber plans to a three-month, $30 "limited time" offer"

One might wonder about 'old subscribers'
What happens 3 months from now?

Plan sounds reasonable, but often new subscribers get a much better deal. If that is the case it sounds pretty meh if it gets worse.

Like to see the business model

[Anonymous Coward]

I can't even get one movie ticket for that price, barring an early matinee.

This sounds a lot less crazy

[godrik]

One movie a day was a crazy for $10/month was a crazy deal on a model where movie pass pays full price for your ticket. Because then some people will use the theater as their tv and you'll end up with people who will cost you hundreds of ticket per year. And recouping your cost becomes a lot harder.

4 movies a month for $120 a year seems a lot more reasonable. You'd have to be really disciplined about going to the movies to get more than 30 in a year.

Not worth it for me, I spend about $200 in movie theaters a year and it is often with my wife and son. So unless we plan on going a lot more to the movies, it isn't going to be worth it for me.

Re:This sounds a lot less crazy

[Anonymous Coward]

The original plan wasn't quite so crazy as it seemed, although clearly there were problems. The idea on profitability comes down to three things:

1. Get discounted ticket prices from theater chains on the sales pitch that people who paid so little for a ticket will be more willing to pay for concessions.
2. Bank on a certain percentage of people not using the service very much.
3. Monetize customer data somehow, perhaps by making it available to industry marketers.

Movie Pass screwed up the execution, plain and simple. They didn't work out details with theater chains before going "live" (possibly because they wanted a stronger bargaining position with a bunch of subscribers), which meant theater chains were more hostile to the concept that anticipated. They failed to grasp the fact that early adopters of the service were exactly the types who would take full advantage of it, whereas the inconsistent people wouldn't start signing up until the service has matured. Finally, they were in the wrong place at the wrong time in relation to public outcry over personal data (would have been a non-issue 5 years ago).

Limiting the service to 4 per month sounds like an attempt to stop the bleeding related to #2, but even that doesn't seem like a good long-term plan. I think a better solution would have been to simply restrict the offer to no later than 4pm, and focus on rebuilding bridges involving #1. If the industry see's MP not as a disruption but rather a way to boost sales during slow periods, they'd be more inclined to work out deals on discounted tickets for them.

Re:This sounds a lot less crazy

[torkus]

Your suggested 'fix' would likely decimate their sub base and is short-sighted to say the least...oh, and it's what they already did in the past and got no traction with.

#2 already happens. Most of their subs are about break-even and see ~1 movie a month. Discount tickets they can't force unless they're in a position of power which was likely the whole point of making their service practically free for a while.

Monetizing customer data isn't a big part of their plan in the traditional way, instead they have (and plan) the opportunity to upsell for additional services. For example, you bought your ticket and have 2 hours to way - well here's a local restaurant that opentable says has an available reservation, or here's a coffee house two blocks away since you only have 1 hour. Oh, and would you like to pre-order your concessions and get on the short pickup-only line when you arrive?

But all this (plus negotiation for reduced/bulk ticket prices) requires they to be a bigger player than they were...which they have accomplished.

Re:This sounds a lot less crazy

[b0bby]

I bought the year pass for something like $90. I have used it twice in the last month, so I feel like I'm ahead so far. There's no way I will average 4 movies a month, let alone go over that, though I guess I might hit that some months. And I can walk to 2 theaters from my house, if I had to get in my car there would be even less likelihood of using it a lot.
Since you can't book in advance most places, you are essentially only able to get seats which would otherwise be empty, and since the ticket is "free" you feel better about buying the overpriced popcorn. So I agree that the theaters probably would be better off working with them.

Re: This sounds a lot less crazy

[Anonymous Coward]

Aside--if you have bleeding related to your #2, see a doctor asap.

That is too true to be good

[Anonymous Coward]

Things got real when they threw in iHeartRadio. Now that's worth the subscription right there!