When Mitch Lowe became CEO of MoviePass in 2016, it looked like the fledgling company might find new life. Having just suffered through one of its toughest stretches as it struggled to find footing. Even at $50/month for unlimited trips to the theater, the company failed to be profitable. Lowe, a former executive of Netflix and Redbox, supported the company’s next phase where they launched numerous tests including a ridiculous $99/month unlimited model, various tiered pricing for 2, 3 or 4 movies a month and even regional pricing. At one point, the company lifted its 24 hour restriction and switched to a true daily restriction meaning instead of having to wait until 10pm the next day after seeing a 9:55pm showing, you could now turn around and see a movie at 1pm the next day with no trouble.
Essentially, from the time Lowe took over the company, MoviePass took steps forward. Unfortunately, by December 2016, the company was sitting with just 20,000 subscribers. Nobody cared. In August 2017, analytics firm Helios and Matheson bought a majority stake in the company and then something crazy happened, MoviePass lowered its monthly price to $9.95/month for a movie a day offering. All hell broke loose. The app broke. Their website broke. In one month, the subscriber base grew from 20,000 to 400,000. By October 2017, the number was 600,000. By the end of the year, there were a million subscribers. By February 2018, MoviePass showed no signs of slowing down as it reached 2 million subscribers.
When MoviePass hit 3 million subscribers in June 2018, the more unusual aspect of the story was that the service had almost no issues. Speaking from personal experience, you were used to a couple of hiccups here and there with service outages or just general headaches or changes to services. Heck, the service even dropped to $7.95 in February and $6.95 in March before briefly replacing the unlimited plan with a three movie per month plan in April and then settling back to the $9.95/month offer. So, it was no surprise when AMC Theatres launched a rival offering at $20/month for 3 movies per week at their theaters that had no restrictions (MoviePass allowed for viewing of Standard 2D showings only), there were grumblings of customers thinking about abandoning ship. Even though the subscriber base was small initially, some had tried the service in its infancy and bailed and others were just soured by word of mouth.
We all knew MoviePass wasn’t sustainable. Do the math. At $10/month, 3 million subscribers brings in $30 million per month. In May 2018, the company lost $40 million. By the beginning of July, parent Helios and Matheson filed to raise $1.2 billion to keep the company solvent. When Impossible Thursday struck and their was a “brief” interruption to the service, no one was surprised to learn that the company needed to borrow $5 million to stay in business. By Monday, the company announced “big” releases would no longer be included right away but peak pricing (another wrinkle that was left out in the earlier discussion of changes introduced by the ever-evolving program) was sticking around.
Flash forward a week and what’s left is a product offering that is reeling (no pun intended). Reports of frequent outages, showtimes appearing then disappearing and movies being available at one point and then being removed from the service altogether. On Thursday, in the morning, every release was available including Christopher Robin which was mentioned as one of the “big” films that would not be available at launch. If you didn’t swing by the theater in the morning, most of the showings that were available had disappeared by the afternoon and before the sun set, the app returned the ominous message, “There are no more screenings at this…” to anyone looking at a theater that wasn’t part of MoviePass’s e-ticketing.
To add more color to how frustrating the product has become, here’s what happened Friday when I went to see Eighth Grade. The night before, the plan was laid out. Schedule an oil change in the afternoon and use MoviePass before it shut down for the day. Before turning in for the night, I checked the MoviePass App and all showings for Eighth Grade were good to go at Regal Brandywine Town Center 16. The target was a 2:25pm showing which was still available as of noon. My girlfriend (who also has MoviePass) and I headed out and dropped off my car and then grabbed lunch and while waiting for our order, I checked the MoviePass app again only to find that all showings of Eighth Grade except for one — the 7:35pm showing — had disappeared. Taking a look at Regal’s app, the 2:25pm showing had only 3 tickets sold and the theater was almost empty. Meanwhile, the 7:35pm showing was already half full and filling fast. Instead of seeing the film at 2:25pm as planned, we walked over to the theater and used MoviePass to get tickets to the 7:35pm showing which, by the way, did not include MoviePass’s Peak Pricing but did end up being a sold out show and while we did end up getting to see the film as part of the program, it was quite the ordeal.
Today is no different. Currently, there’s a 3am showing listed for Death of a Nation and The Spy Who Dumped Me. Peak Pricing is being enforced for Teen Titans Go! To the Movies at the three showings being offered (6pm, 8:20pm & 10:45pm) but the 12:20pm and 3:10pm showings aren’t available. The Equalizer 2 also has Peak Pricing for 5:20pm and 10:50pm but isn’t offering showings at 11:40am, 2:30pm or 8:10pm. Despite this, The Spy Who Dumped Me doesn’t have Peak Pricing in its opening week but is also blacked out for the two matinee shows. Christopher Robin, The Darkest Minds, Mission: Impossible Fallout and a 20th Anniversary re-release of The Big Lebowski are all unavailable and only late showings of most other films are showing up and if the last few days are any indication, those showings should disappear well before it would make sense for you to head to the theater to buy tickets.
Now, MoviePass is facing the worst problem a product could have. It’s unreliable. Unless you are near a theater that offers E-Ticketing (the closest to me is 23 miles away), you’re unlikely to be able to predict whether MoviePass will work for whichever movie you want to see. Today, if I wanted to see a movie before catching the red-eye to Vegas, I’d have to drive into the city to hit a theater offering E-Ticketing or come out of pocket. Even at $9.95/month (and soon to be $14.95/month), the inconvenience and unpredictability of the service makes AMC’s A-List a much more compelling offer even at twice the price for a service that caps at 3 movies per week (though that still allows for 12/month) and forces you to go to AMC Theaters (which, if you follow me on Twitter, you know I’ve had my problems with their customer service).
So, what’s next? At 3 million subscribers, MoviePass is still relevant. However, their parent company’s stock price just cratered and the company faces delisting by Nasdaq. MoviePass were pioneers offering an alternative for a product that had gotten out of hand with its pricing model as a trip to the theater had reached ridiculousness when it came to its impact on the wallet. Back in 1999, Napster revolutionized the music industry as downloading music became the way to go. Legal battles sent the company into bankruptcy in 2002 but out of Napster’s death came new life to the way the music business operated. Maybe that’s what MoviePass’s lot in life is. It’s hard to imagine MoviePass surviving these latest round of blows. The company has had to weather the storm of its own missteps that it’s not unfair to estimate 90% of their 3 million subscribers haven’t had at least 1 negative experience with the service. As competition rises, it’ll be hard for MoviePass who already has a few Fs on its report card to earn back its customer’s trust. Think MySpace vs. Facebook. Think Blockbuster vs. Netflix (yes, Blockbuster had a competing service to Netflix). AltaVista, DrKoop.com, Color and WebTV all existed and failed. They came before Google, WebMd, Instagram and the browsing technology and Apps built into our televisions.
Maybe that’s MoviePass’s eventual path. It has to die for something better to live. It’s doubtful that’ll be AMC’s A-List because AMC hasn’t been able to figure anything out without screwing it up. They offer an inferior Rewards program and have a long list of experimental failures. (Remember their failed partnership with Planet Hollywood to open megaplexes called Planet Movies? Of course not because they were only able to open one and it failed.) They couldn’t even get wheelchair seating right when they first opened stadium seating back in the 90s. Maybe AMC’s A-List will survive alongside competitor’s competing offerings forcing patrons to choose theaters. This would still pose a problem for those of us who want to see smaller independent films since typically, AMC sits those releases out as does Regal (though they do a much better job). Ideally, it’ll be something very similar to MoviePass which learns from the company’s mistakes and avoids the same pitfalls as it grows.
I’ll likely hold out to the bitter end. I love MoviePass and everything it’s done for my ability to get to the theater as often as I have. Even at $9.95 or $14.95 or whatever today’s price is, the value is still there. I could see myself ending up with both MoviePass and A-List despite my issues with AMC’s services. (Seriously, you call a crappy theater you don’t want to invest money in AMC Classic? You should be ashamed of yourself!) There will be someone who figures it out. The days of paying $13 a ticket will eventually be a thing of the past. It might take a while. You can still be a music CD at Target (but not at Best Buy). Popcorn will still require signing over your first born, though. Some things will never change.