Friends, Royals, and film lovers: we are gathered here today to commemorate the short life of our dearly beloved MoviePass. Despite the actual company technically still being in existence, what was once a great deal has subsequently come to an end. Stock in September was found at about two cents a share, and as of September 4th, Chief Product Officer Mike Berkeley was reported to be leaving the company after only having served for six months. With MoviePass celebrating a year of not falling into near bankruptcy since first announcing its price change, we take the time to reflect on where this movie going entertainment site went wrong, and what the future holds for both the company and its users.
Originally founded in 2011, the name Movie Pass first caught the public’s eye in August 2017 when it announced it would be lowering it’s unlimited movie pass subscription from $50 to just $10 a month. With the average movie ticket costing about $9.16 in the U.S. market, this subscription seemed to good to be true, with many questioning the logic of majority stakes owner Helios and Matheson Analytics and hypothesizing on it’s future. No limits seemed to appear on the number of movies a consumer could watch per month, let alone each day. This meant that for the price of one movie, anyone subscribed had the ability to attend an unlimited number of movies each month, the total cost rounding out to zero if they chose to not buy popcorn or other goods. So how did MoviePass manage to stay alive so long?
“I think that MoviePass was trying to do a really good thing, and trying to promote going to more movies at a low cost, but their business model was just not a solid model,” said senior Nate Ewart.
Operating at a loss is not a new business model. Before turning a profit, major companies such as Amazon have grown having lost thousands of dollars operating at a low cost, but to many critics, the level to which MoviePass relaunched itself was extreme. In the course of one year, nearly 3 million new subscribers signed up, ready to take full advantage of their movie going experiences, but it was still not enough to provide steady profits. According to MoviePass CEO Mitch Lowe, their plan was to not only cut deals with studios and big theaters, but also utilize public data from subscribers as a way to balance the losses in profit. Neither of these two plans were able to fully succeed, with some theaters viewing MoviePass as more of an enemy than a friend. According to CNN, the company was burning through $21.7 million dollars per month, it’s total stock taking a nosedive and losing 99.9% of its value.
“I loved MoviePass,” said senior Owen Thames. “After taking Film Studies at CC, I really grew more appreciative of films, and MoviePass allowed me to go out whenever I was bored. I’d go about four times a month to the theater, but I’m sure there were people using it even more than that.”
Unfortunately, this year has really been a strain for MoviePass investors, customers, and employees. Like a cat with nine lives, however, this new year presents itself with another chance to come back. The company is now offering $9.95 a month for 3 movies from preselected films, dates, and times. This comes as a response to a new lawsuit filed by shareholders for being misled about the business and its prospects. In addition, controversy has also risen amid notices sent out to former customers alerting them of their reopened accounts as well as a revealed earnings report showing that the company was spending $73 million per month (and is projected to run out of money in 2 months). With the new update also comes new limitations in the number of films per month a subscriber can attend plus which films they can see. Lowe claims the change is only “for the time being” and “during this transition period,” but there is currently no end date set, leaving customers to question where the company stands.
“If I were to sum up the experience in a few words, it would be ‘cheap movies sometimes’,” said Margo Snyder from San Francisco. “Or maybe ‘too good to be true.’”
One can only hope for the best for this company and its partners as it continues to flounder. While short lived, one cannot ignore the impact it had, and we all look forward to the next attempt at saving theaters from streaming services.