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No More Repeats With MoviePass

empty movie theatre, facing projector
photo by Jon Seidman

My wife and I received one-year prepaid MoviePass subscriptions from our kids as Hanukkah gifts last fall. It was perfectly timed, since the holiday season (also known as Oscar-contender release season) is when we often take a vacation that includes seeing a half-dozen films or more.

After one or two administrative glitches, we got the hang of it. We received our special-issue debit cards in the mail and downloaded the app. We discovered we must be physically present at the theater to purchase our tickets. We found that computerized theater kiosks worked very well; manned ticket vendor stations proved to be hit and miss. But generally we could select our tickets, pay the with debit card and enter the theater as usual.

The biggest drawback for us is that an increasing number of theaters use assigned seating. This means we do not necessarily know whether appealing seats are available for the show we want to see in advance even if we arrive, as is our custom, well before the auditorium doors open. On one or two occasions, we opted to see a different film than the one we intended as a result – not a big deal during Oscar season, but a potentially annoying time-waster otherwise. Also, since we have individual MoviePass cards (the only sort available), each of us must buy a ticket separately. This creates the remote chance that in the time between our first purchase and our second, somebody else might take the neighboring seat that we had intended to secure. We have not yet had such a blind date, but it could happen.

Despite this, MoviePass has been a good deal for us, if hardly a life-changer. It doesn’t work at IMAX theaters or for specially priced (that is, pricier) 3D films. It doesn’t work at some very high-end auditoriums that offer personal waiter service. And it doesn’t work at all theaters, period, because of the ongoing suspicion by some exhibitors that they are about to be taken for a ride. With detente breaking out on the Korean peninsula, tensions over ticket sales in Hollywood may currently be higher than those along the demarcation line in Panmunjom.

The whole dispute seems stupid to me, mainly on the part of AMC and other exhibitors pushing back against MoviePass. They seem to think they are in the ticket-sales business, which is ridiculous from an outsider’s perspective. For tentpole hits, they already remit the lion’s share of the ticket sales to the film studios; by some reports this can be as high as 65 percent for the biggest releases. And fewer tushies are landing in theatrical seats overall. I really don’t go to movies to see stuff on the big screen, and I go to more movies than the average American. I am just as happy to see them on the big flat-screen at home, which makes up for any artistic deficiencies with its magical “pause” button. No theater I have ever seen offers patrons one of those.

AMC and other theater chains are in the business of providing an out-of-home diversion and selling very high-priced refreshments and meals. To do that, they need tushies, and the other body parts that come with them. MoviePass is in the business of bringing tushies to theaters. Wake up, people. Your interests are aligned.

By the way, Hollywood studios are not famous for their business loyalty. As other revenue streams eclipse ticket sales, they will drop theater exhibitors without a second thought. It is already happening. More entertainment product is heading directly to Netflix and other video-on-demand sources these days, while the number of theatrical releases is stagnant or falling, and the period of theatrical exclusivity is shrinking. That means less product to put in theaters. Less product means fewer tushies. MoviePass exists to help exhibitors buck the trend.

But MoviePass may not be sustainable in its current business model, and customers are already getting a poorer deal than my wife and I enjoy.

MoviePass rocketed from a relatively obscure service to one with more than 2 million subscribers after adjusting its price to $10 per month. But anyone who did the math knew that, even with the limits I’ve mentioned, this deal would not last forever absent some other revenue source. MoviePass has now admitted that the “unlimited” plan is on its way out. New subscribers can now only purchase four tickets per month, rather than the previous limit of one per day. (For the time being, existing users like me are grandfathered into the old terms.) This may be a good deal for some, depending on their viewing habits, but it is certainly a downgrade. MoviePass has avoided saying that the unlimited version is gone for good, but I would not hold my breath waiting for its return.

The company also recently modified its terms of service to prevent subscribers from buying tickets to repeat viewings of “select” films. So far, MoviePass has not offered an explanation of which movies will be included. My wife and I rarely see the same movie in a theater twice, but there are serious film buffs or die-hard franchise fans who do. MoviePass now has become a much less compelling value proposition for them. And even somewhat less for us; if my wife sees a film that she likes with a friend or one of our daughters, there is now less incentive for her to see it a second time with me.

As The Verge pointed out, MoviePass has tried instituting and walking back changes before, such as promoting movies in certain markets, asking customers to upload photos of their ticket stubs or blacklisting certain theaters in order to pressure chains like AMC. The company seems to be trying to balance keeping its customers happy with securing a more sustainable business model, as plans to monetize customer data have struggled to keep pace with the service’s popularity. Its parent company, Helios and Matheson Analytics Inc., reported a $150.8 million loss for fiscal 2017, raising questions about its long-term viability. Yet CEO Ted Farnsworth remains optimistic. He recently told The Hollywood Reporter that MoviePass makes a profit on 88 percent of subscribers, who only see about one movie a month. He regards heavier users as evangelists for the service.

I would like to see MoviePass succeed. But ultimately I don’t really care too much, because I don’t really care too much for movie theaters. I can always spend my money on a bigger flat-screen, which comes complete with pause button. And I can make my own popcorn.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us” and Chapter 4, “The Family Business."

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2 Responses to "No More Repeats With MoviePass"

  • John Dye
    May 8, 2018 - 1:41 pm

    A great summary (and I enjoyed your take as well)! Jenny and I have the service, and enjoy it. In Utah, movies are usually $5 on Monday and Tuesday, so we can always see what we want to see at discounted rates. Not sure I will continue with the service after our year expires.

  • Rob Christianson
    May 8, 2018 - 2:36 pm

    The drawback of the gift subscription (as you may have found out) is that you can not convert it to a subscription in your name and extend it beyond the initial term. Mine was 3 months, a Christmas gift from my wife. Once it expired, I had to sign up again. Not cool.

    When I did, the unlimited movies deal was gone. I am limited to 4 movies per months with no repeat viewings, and a worthless 3-month trial to IHeartRadio.

    A few days after I signed up again for the only deal available, they began offering the unlimited program again for 9.99 per month. I contacted them via their online form to be contacted about converting my new membership to the 9.99 deal again but have yet to receive a reply and it’s been 5 days now. I just got my new card a few days ago.

    It’s a great deal, even if it’s only 4 movies a month, but the user experience has been HORRIBLE.