×

MoviePass to Experiment With New Pricing Models, CEO Says

When MoviePass launched in 2011, it promised to revolutionize the theater-going experience much as Netflix had upended the home entertainment business. But five years later, the company, which offers unlimited monthly access to theaters, remains little known, its ambitions stymied by exhibitors who see it as a threat, not an ally.

Raising Moviepass’ national profile and changing theater chains’ minds about the service is now the task of Mitch Lowe. The co-founder of Netflix will take the reins at the movie theater subscription service this month. He hopes to grow MoviePass’ user base by offering different price plans and streamlining its service. It will also fall to the newly minted CEO to try to convince the exhibition industry that MoviePass can help bolster ticket sales and concession revenues at a time when consumers are losing interest in cinemas.

“People are going to the movies less often because there are these other great entertainment options available,” Lowe told Variety. “They’ve been losing interest in going to theaters. But at the same time, theaters have done a good job of upgrading the experience. They’ve put in new seating and better sound. We can help get people back into theaters so they can be reminded of how great it is to see a movie on the big screen.”

The company has already commissioned a study that shows its service boosts attendance by 111% and that its customers buy more concessions. That’s good news for an industry that has seen ticket sales flatline in recent years. In 2015, the number of frequent moviegoers, defined as people who go to the cinema at least once a month, decreased by 3.7 million or 10%, according to the Motion Picture Association of America.

Bruce Nash, founder of the box office tracking service The Numbers, said that theaters might be intrigued by what MoviePass is selling, provided it doesn’t conflict with their own in-house loyalty programs.

“It’s a very seasonal business and it could help stabilize their revenue streams,” Nash said.

MoviePass’ service, which costs between $30 to $40 per month to see an unlimited number of movies, has failed to firmly establish itself. It remains more of a niche offering than a national phenomenon. Lowe believes that the price point could be a stumbling block. He plans to experiment with a tiered system of packages, starting as low as $20 a month for access to a smaller collection of movies and extending to roughly $100 for unlimited films in 2D, 3D and Imax formats.

“We need to experiment,” Lowe said. “Not every package will meet all the people’s needs.”

This week, MoviePass began sending members in certain locations billing information for new services, some of which amounted to a price increase. Users in Los Angeles, for instance, were told that new monthly plans included a $50 package for six 2D or 3D movies and a $99 package for unlimited movies in any format.

Peter Duckler, a consultant in Los Angeles, has used the service since 2014, often seeing between two to three movies a week. He was upset by the pricing changes.

“They’ll lose a lot of early adopters like me,” he said. “What they’re trying to do is eliminate the unprofitable people. The people who use the service all the time.”

For his first six months at the helm, Lowe plans to go deep into the weeds, looking at ways to improve and streamline the service, which currently operates by having customers buy tickets using a phone app and a debit card. After that point, he will focus on growing the subscriber base, potentially through marketing. He’s open to eventually expanding the service in foreign markets such as Mexico, Canada and parts of Europe, and said he is busy raising money to fund operations. MoviePass’ investors include True Ventures, AOL Ventures, NALA Investments, WME and former Facebook chief privacy officer Chris Kelly. Lowe is also backing the company with an investment in the “healthy six figure range.”

Lowe, who also had a stint as Redbox’s COO and president, said MoviePass founder and the previous CEO Stacy Spikes will remain involved in the company as its co-chairman. He was hired to bring more seasoned executive experience to the fold.

“They just needed a new perspective and an objective person to come in and take the company to the next level,” Lowe said.

Popular on Variety

More Film

  • Reese Witherspoon Kerry Washington Ryan Reynolds

    Market for Package Deals and Original Ideas Heats Up Ahead of Platform Launches

    Practically every studio in town wanted it, but in the end it was Apple that swept in to nab the reinterpretation of “A Christmas Carol” with Will Ferrell and Ryan Reynolds. To buy the highly coveted package, the tech giant was willing to shell out more than $60 million to the stars and the film’s [...]

  • Ruben Fleischer

    Ruben Fleischer Returns to His Roots for 'Zombieland: Double Tap'

    Recapturing the personality of a successful film for its follow-up can be a challenging task for a filmmaker, given the story told, characters involved and especially the time passed between installments. But even after 10 years, “Zombieland: Double Tap” director Ruben Fleischer knew exactly what to focus on to ensure that his sequel lived up [...]

  • Maleficent

    How 'Maleficent' Sequel's Characters Drove Costumes and Special Effects Makeup

    The art of making sequels demands a fine balance between revisiting an existing world and giving the audience something new to chew on. For Disney’s “Maleficent: Mistress of Evil,” costume designer Ellen Mirojnick and special effects makeup designer David White started with the familiar and built things out from there. “This movie is a fantastic [...]

  • Michael Caine poses for a portrait

    Michael Caine, Lena Headey to Star in Modern-Day Version of 'Oliver Twist'

    Michael Caine, Lena Headey and pop star Rita Ora are to star in “Twist,” a modern-day, gender-bending film interpretation of Charles Dickens’ classic novel “Oliver Twist” for Sky, which will release the film day and date in theaters and on its pay-TV platform. The title role of Oliver is played by Jude Law’s son Raff [...]

  • Lucia Milazzotto

    Rome MIA Director Lucia Milazzotto Talks Linear TV and Theatrical Comeback

    MIA market director Lucia Milazzotto is the main architect of Rome’s new format post-Mipcom, pre-AFM confab launched five years ago to serve as a driver for the Italian industry in the global arena. The MIA acronym stands for (Mercato Internazionale Audiovisivo, or International Audiovisual Market). Milazzotto spoke to Variety about how this unique event featuring [...]

More From Our Brands

Access exclusive content