MoviePass is Making Changes in Attempt to Stay Afloat

posted by Mason - 


UPDATE: MoviePass won't raise prices, apparently. Instead, they'll limit users to three movies per month. A new story is HERE.

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It was always too good to be true. But for about a year, it was actually possible to see any theatrical movie for just $9.95 per month. That was the promise of MoviePass, a subscription movie service that would let its customers see up to one movie per day, so long as you didn't see the same movie twice. 

For movie goers, this was a fantastic bargain. When even a matinee can cost $10, you're going to break even going to just one movie per month. But for the company, which has essentially been buying its customers full price tickets for the movies they see, there was no way to be successful. Let's say a customer went to just one movie per week. After four weeks, MoviePass spent at least $40 on tickets, while receiving less than $10 in return. That's just one customer, and MoviePass has more than three million users!

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The math doesn't add up. 

Last Thursday, they finally ran out of cash. An emergency loan got the company sputtering through the weekend, with sporadic outages that left many customers angry and annoyed. They also blocked access to the #1 movie in America: Mission Impossible - Fallout. (Great movie, by the way. Maybe the best in the MI franchise). And their new "surge pricing" on popular movies, which was introduced at the beginning of July, was soon adding $6-$8 to the cost of every ticket for nearly every movie. It was not a good weekend for MoviePass.

The surge pricing has since calmed, and a check today at the time of this writing found no surge pricing in effect for theaters in our area. However, the app didn't appear to be offering early evening showtimes on most movies either. At this point, we can paraphrase Forrest Gump: MoviePass is like a box of chocolates, you never know what you'll be allowed to see.

Now, as MoviePass tries desperately to stay in business, their subscription price is going up while access to first run movies is going down

On Tuesday, the company announced some new initiatives, including a price increase to $14.95 per month. They also announced that they'd restrict users from seeing new movies that open on 1,000 or more screens for their first two weeks of release. And of course, surge pricing is still a possibility -- depending on which movie you see.

The company says they're open to making a deal with a distributor to make a first run movie available right away. After all, the company claims credit for significantly boosting this summer's box office receipts; and in just one year with their $9.95 price point, they've been securing 1 in every 17 movie tickets purchased in the United States. Clearly, they have the power to boost box office numbers if nothing else, and it may be the carrot they can use to lure movie distributors into their web.

But short of these distributor deals, the new initiatives mean that MoviePass customers will need to be a wee bit patient to see a blockbuster movie, and wait until the hype machine has died down. It means smaller independent movies (like shows that play at the Crescent Theater in Downtown Mobile) would still be available, even early on. 

It's not a terrible deal, but it's also a classic case of "overpromise, underdeliver." They promised the moon and couldn't make it a long-term reality, so now they're cutting back. What would have been a great service on its surface now seems a shell of its former self. 

If nothing else, MoviePass has changed the movies forever. The subscription model is likely here to stay, even if it takes another company to make it work. AMC Theaters has already started its own, and its program is built to take on some of the weaknesses inherent to the MoviePass model. It's $19.95/month and will let you get advance tickets, see 2D/3D or IMAX movies and is good for opening weekends. The drawback is that it's only good at AMC Theaters (good news, our area has plenty of them).

There is also a subscription service called Sinemia, which has plans with a variety of price points -- none of which offer unlimited movies. But it covers most theater chains (just not the local Crescent Theater), allows you to watch movies in 2D/3D or IMAX, and lets you see movies on opening weekend. USA Today says it's a bit clunky in the way you purchase tickets, but a good deal is a good deal. 

My wife and I haven't decided where to go next -- stay with MoviePass, get another service, or just pay one movie at a time. In the first three months of our MoviePass membership, we only went to one movie and essentially wound up paying $30 to see Avengers: Infinity War. MoviePass wishes all their customers were like us. 

This month, though, we saw two movies. The first was Mamma Mia, and we got our first look at surge pricing -- an extra $2.90 or so per ticket. The next was Mission Impossible - Fallout -- and of course, that's the first movie that was blocked by the app. We couldn't use MoviePass and simply had to buy a ticket. 

  • Money Saved by Having MoviePass = $7
  • Money Spent the MoviePass Subscription = $9.95

Maybe we can see another movie before our subscription renews for another month... or before they go out of business.

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