Movie ticketing service MoviePass now has more than 1.5 million paid subscribers, adding 500,000 in less than a month.
The service, which made the announcement on Tuesday, allows subscribers to purchase a single movie ticket per day for a flat monthly subscription fee by using a mobile app. The company, which is majority-owned by Helios and Matheson Analytics, unveiled a pricing plan in August at $9.95 per month. It then offered a limited-time subscription in November of $6.95 a month.
“MoviePass is attracting people back to the movie theaters by lowering their cost, which we believe is transformational for the industry,” said Ted Farnsworth, chairman and chief executive officer of Helios and Matheson. “We believe the data MoviePass collects from these million and a half moviegoers will become an important asset to our partners and the future of the movie industry.”
MoviePass pays theaters the full price for a ticket, so it is in essence subsidizing its users’ moviegoing and losing money each time they check out a film. The average movie ticket cost $8.60 through the first three quarters of 2017, but in major cities, such as Los Angeles and New York, tickets often cost more than $10.
AMC, the country’s largest chain, threatened legal action against MoviePass in August and predicted that the company would fail because its business model was not sustainable. There is anxiety among exhibitors that customers will get accustomed to paying a discounted rate for tickets, which will depress prices.
Cinemark launched a MoviePass competitor called Cinemark Movie Club in November that lets customers buy a movie ticket a month for a discount price of $8.99, in addition to 20% off on concessions.
The domestic box office revenues for 2017 trailed last year by 2.3%, thanks to disappointing movie performance in the summer and in October, according to comScore. MoviePass CEO Mitch Lowe suggested that MoviePass could be an antidote for the moviegoing slump.
“Based on the dramatic increase in the number of MoviePass subscribers over such a short period of time, we believe MoviePass will continue to grow its subscriber base significantly,” he said. “We’re giving people a reason to go back to the movie theaters and they’re going in droves. With awards season here, we hope we can make Hollywood and exhibitors very happy by filling seats with eager audiences.”
MoviePass made the announcement made the announcement before the NASDAQ market opening. Stock of Helios and Matheson Analytics rose 3.5% by 24 cents to $7.16 a share.
