MoviePass Sells to Helios and Matheson Analytics

MoviePass Sells to Helios and Matheson
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MoviePass, a company that aims to be the Netflix of movie theaters, has sold a majority stake to Helios and Matheson Analytics Inc., a publicly traded data firm. A purchase price was not disclosed.

As part of the deal, MoviePass also announced it is overhauling its pricing model. It will now enable customers to see movie a day in a theater for a $9.95 monthly fee. The company said there will be no blackout dates and no contract is necessary. The new subscription will not include tickets for 3D or IMAX showings). In the past MoviePass offered a tiered pricing model, with plans ranging from $14.95 to nearly $50 a month.

“This is about getting funded in order to launch our new price point,” said Mitch Lowe, the company’s CEO. “After years of studying and analysis we found that people want to go to the movies more often, but the pricing keeps going up, and that prevents them from going more. We’re making it more affordable for people.”

The service is available in over 91% of all theaters in the U.S., including AMC, Regal and Cinemark theaters along with independent theaters. MoviePass does not publicly disclose its subscriber numbers.

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MoviePass has struggled to gain traction in the industry and has often been met with ambivalence, even antipathy by theater owners. Established in 2011, it has gone through several iterations and has failed to get Hollywood to buy its sales pitch. The company claims it boosts attendance by 111% and that its customers buy more concessions. But exhibitors have preferred to bolster their own loyalty programs instead of aligning themselves with the service. Despite its ambitions to disrupt the industry, MoviePass remains little known.

Lowe, a Netflix co-founder and former Redbox president, has led the company since June 2016. He will remain in charge along with Stacy Spikes, MoviePass co-founder. They plan to add to their nine-person staff, particularly in the sales and technology areas.

Lowe said the company works by buying movie theater tickets for its subscribers directly from exhibitors at whatever price they offer. MoviePass is operating at a loss and subsidizing its users with the hope that at some point it will successfully demonstrate to studios and theater owners that it is growing their customer base. After demonstrating its value, he hopes MoviePass will be cut in on the profits.

“We’re hoping that if we can drive a meaningful increase in attendance we can share in that success,” said Lowe.

It’s been a bruising summer for the exhibition industry. Ticket sales are down more than 12% year-over-year, and the stock price of AMC and Regal have been battered by declining admissions. Lowe believes that gives MoviePass more leverage. He notes the company is popular among millennials, a demographic weaned on streaming services, and one that has fallen out of the habit of going to cinemas. Seventy five percent of MoviePass’s user base falls in that age range.

“We serve Millennials who have grown up with Netflix and other subscription models,” said Lowe. “They like that model.”

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  1. I was a avid MoviePass subscriber for a little over 2 consecutive years. I averaged 10-15 movies a month when I was active and back then it was a $30 a month deal because I am in Chicago, which was one of the higher priced cities back then. But they dropped the price for new subscribers and burned all of us “old-timers” so I quit the serve and never looked back. I stopped going to the movies altogether as a result. I don’t recall the last time I went to the movies at all, it’s been several years at least. However, this new low price has me compelled to try it out before they raise it back to a real price level. This is just a stunt to get people back in. I may do it once I read the fine print. But even at $9.95 I will try it likely for one month. I never heard of Helios and Matheson, but I just watched their interview with Maria Bartiromo (man, she has changed a lot…) so I believe this is a play for data. Which could make it like a Google AdSense or AdWords data mining tool or something along those lines I think. The app was awesome, sometimes it just did not work. But when you are doing 10-15 movies a month a hiccup here and there was no big deal. As I recall, I was paying basically $3 a ticket or less at my peak engagement with the app. I was in before they instituted the one new movie every 24 hour rule. And I KILLED IT!!! So they never made money on me at all. Even after the 24-hour rule was permanent I never bought concessions either. It was a straight watch the movie and split out the theatre deal. Also, I went during the day and avoided the crowds completely. Interestingly, MoviePass worked during certain Movie Festivals at AMC, so that was an added benefit. Not sure if that is still the case or not? I even recall using it during Black Harvest Film Fest at Siskel Film Center one year. May or may not work now for that but $9.95 is $20 off what I was paying. I think it’s a good deal today, right now. Next month or later this year I suspect the price will be back to $19.99 or $24.99.

  2. MoviePass and other similar systems are doomed to fail until they introduce a way to purchase multiple tickets at once – my wife and I would use this all the time, but we won’t at this time because there’s no way to ensure that we will be able to sit together; they have never introduced the long promiased couples option and until they do, it’s a no go for us, for for us recommending it as well. This aspect of this and other systems like it needs to be rectified before it can really take hold in the movie theater marketplace.

    • David Gulick says:

      I don’t know man. The price point is so much lower than it was I don’t know why you would even need a couples option. Why not you and your wife just get separate memberships. A lot of long time moviepass subscribers were burned by them making prices higher in the past but this is very good news. Helios and Matheson could potentially make very good money by selling the data they get from it’s subscribers because that is what they do.

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