Late last year I signed up for a too-good-to-be true offer: a movie ticket every day for less than the price of a single evening ticket. MoviePass offered this deal starting in September and I jumped onboard in mid-December. There were a few restrictions – purchases had to be made in person at the theater and on the same day as the showing and no iMax, 3D or other specialty screenings were allowed – but otherwise it worked with almost every theater in the nation. There had to be a catch but after a month of using it, I hadn’t found one yet. Now, about six months later, there’s been a roller coaster of sudden user agreement updates and a continued battle with major movie chain AMC. Other sordid affairs and concerns about leadership of MoviePass and its parent company have created a lot of doubt about the future of the company (they involve blocking locations and even certain movies for mysterious reasons, a major shareholder who may have defrauded creditors in India, some likely tinkering with audience scores for Gotti and an old psychic 900 number if you’re looking for a rabbit hole to dive into).
But what has all this meant for the actual user?
Before I go on, I know the audience here is wonderfully international and this isn’t directly relevant in everybody’s area of the world (in fact, I’ve read there are countries where subscription movie services have been around for a while – would love to hear more from anybody that can speak to this). But I’m interested by MoviePass’s attempt to change movie-going culture in America and I feel its story has something to say about how businesses and consumers relate in general and about the American movie-going experience. Those thoughts come in the last section. I forgive you in advance for skipping ahead.
A quick history of the saga to date: MoviePass dropped their prices to an insane $9.95 per month for a ticket per day (for reference, the non-matinee ticket prices for a single eligible movie in my Midwest town are $10.00-$11.11; the average price on a major coastal city is closer to $15.00). Crazier still, it works for every theater that accepts Mastercard because when a user checks in through the app, MoviePass simply adds the cost of the ticket to the card and the theater receives the full payment when you purchase your ticket.
In the early part of the year, MoviePass talked up its increased membership and claimed it added $110 million to the box office totals for Oscar-nominated films, including a whopping 11.48% of the total gross for I, Tonya. These figures are extremely dubious (MoviePass took credit for an assumed number of additional ticket sales based on people accompanying the pass holder) but even so, they speak to the company’s wheelhouse: independent and mid-tier films. The kind of films people had become willing to wait and watch on streaming services and rentals or possibly never got around to at all.
There’s also been a bit of clarity to the question that has always plagued MoviePass – how is the company planning to make money when it’s taking its users out to the movies every night? MoviePass partnered with a couple smaller chains to split revenues, though the larger chains like the company’s nemesis AMC have remained hostile. MoviePass also partnered with individual films including I, Tonya to promote those films to users through the email and within the app. Biggest of all, the company started MoviePass ventures to acquire and distribute films. So far these films include the indie doc/heist film hybrid American Animals and the John Travolta gangster bio Gotti.
MoviePass moved with confidence at the beginning of the year, but as the schedule moved from awards season cleanup to blockbuster opening, problems arrived.
The changing terms for acquiring and using MoviePass have not helped the perception of the company as unstable. I signed up as a month-to-month payment which I can drop at any time. Shortly after I signed up the company required a full year’s payment upfront. Currently you have to sign up for three months at a time.
The price also kept shifting. In February it dropped to an unbelieveable $7.95/month, then $6.95/month in March (aka $83.40 for the year). In April, to curb abuse of the system (and the rapid disappearance of its capital) MoviePass changed the plan from a ticket per day to four tickets per month for new subscribers. CEO Mitch Lowe, whose statements to the press have also been unhelpful to perceptions of stability, indicated he didn’t know if the “unlimited” plan would ever return. It did – the options currently available are the old unlimited plan for $9.95/month or a “limited time offer” of 3 tickets per month for $7.95. Another option for a plan isn’t a bad result, but the quick changes and retreats invited more criticism and shook the confidence of subscribers.
With about 3 million new subscribers in the last half year, the MoviePass became ripe for abuse. It’s a difficult system to police when all parties involved in the immediate transaction – consumer, theater, and Mastercard – are representing themselves with no stake in MoviePass itself. Mastercard can confirm the purchase is made at the theater, but it can’t see what was purchased and theaters are bound by agreements with Mastercard to take the pass no matter what (this is how MoviePass got around objections by AMC et. al. in the first place). Pass holders can buy a ticket per day just to get reward points for free concessions and eventually free tickets. Less scrupulous users can check into a movie and swipe it at the concession stand (maybe after using a free ticket from reward points to get in). Holders could buy Infinity War tickets and scalp them at a lower price.
Safeguards against these abuses bristled users, mostly because they have occurred with little or no notice as user agreements are updated on the fly. Users are no longer able to use it for the same movie twice (the website’s FAQ disingenuously claims it’s to encourage users to seek out a variety of films). Select users have been required to verify their purchases by sending in photos of their ticket stubs before the next time they use the pass. The company has clamped down on logging into the account from more than one device.
A recent email announced further changes. There will soon be a surcharge for viewing films during “peak demand.” What films and times this affects is unclear, though I think it’s safe to assume an opening weekend Pixar film will incur a couple dollars. MoviePass is also rolling out new upgrades to plans including one where you can seamlessly pay for a partner’s ticket (for full price unless they sign up for MoviePass within 24 hours) and one that allows for 3D, iMax and other premium experiences. These services appear to add a little bit of convenience rather than any kind of further discount.
How This Affects the User
So if you’re a MoviePass user or potential one, what of all this affects the benefits?
The kibosh on repeat viewings was biggest loss, though I only pulled that off once (for that money-grabbing blockbuster Phantom Thread). A friend of mine who signed up later than I did got picked to send photos of his ticket stubs and he is understandably irate about it, largely because the MoviePass Android app has a habit of crashing when he attempts to comply (though it hasn’t stopped him from using the pass). The “peak pricing” is a little concerning without knowing how broadly it will be applied, though subscribers will each get a single “peak pass” per month, meaning they can see one of the affected screenings without incurring the surcharge. This should be more than enough for myself, who has tended to see smaller films late on weekdays.
I have seen a total of 21 films with MoviePass in the time that I have been charged six times. The total value of the tickets purchased was $217.32 compared to the $59.70 I paid in subscription fees, a savings of $157.62 (or about 15 “free” tickets – the numbers are a little wonky due to a couple matinees and a visit to a discount theater). Of those 21 films, there were only four that I went to only because they happened to have a beneficial showtime (i.e. – not ones I was particularly seeking to see). Of those, two were middle of the road, one was a regrettable waste of time and the fourth may turn out to be one of my favorites of the year. As a movie buff, I like them odds.
The diminished flexibility to MoviePass due to the potential issues with abuse (and the very real issue of the company hemorrhaging money from legitimate usage) is disappointing but hardly diminishes the value of the offer. I’m still a little perplexed by friends who already go to at least a movie per month that balk at signing up because what if the company doesn’t survive? Well, at that point you stop saving between 2 and 25 dollars per month and go back to whatever you were doing before. There’s some concern about data tracking (again, not helped by CEO and ill-considered spokesperson Mitch Lowe) and I totally get that as a reason from anybody with no facebook account or grocery store rewards cards.
The Bottom Line
The real head-scratcher is how a company whose entire model is basically giving away movie tickets has faced such poor public relations. The reasons for the changes in terms make sense when considering the possibilities for abuse, but it would have taken very little imagination to see those coming before rolling out the “unlimited” plan that put MoviePass at the center of attention half a year ago. The drive to make such a large splash is understandable – MoviePass had offered more moderate deals for years (e.g. – tiered subscriptions with prices varying according to region) and boasted only about 20,000 subscribers. I had never heard of them. But the $9.95 plan may have put them in the spotlight at the cost of their strengths.
The lesson to be learned from MoviePass is the same one apparently left unlearned by the makers of their film Gotti: know your audience, respect your audience. Had MoviePass publicized an offer for, say, four movie tickets per month for $9.95, it would have been an eyebrow-raising deal and anybody with a desire to see movies in the theater and basic math skills would have gone for it. But MoviePass didn’t want us to have to do any thinking to recognize the new deal, they wanted us to lose our minds over it. A movie every day for less than the cost of one! You don’t even have to know how much a movie ticket costs (i.e. – be someone who goes to the movies) to recognize that as an impossible bargain. Then the offer left them nowhere to go but to backtrack on the “unlimited” plan. I learned from my own time running a small business that a customer who is given a $10 discount is perfectly happy. One who is offered a $20 discount but then has it changed to a $10 discount is pissed. Ten dollars is ten dollars, but a discount of ten dollars has a fluid value.
MoviePass also relies too much on users outside their strongest base with the new deal. There’s a reason they get along better with smaller studios, smaller films, smaller theater chains. The audience that’s best suited to this deal is probably a lot like me – seeing a variety of movies, not always the biggest titles and not always at the busiest times and locations when tickets need to be purchased ahead of time. But MoviePass didn’t just want the indie and mid-tier crowds, they wanted everybody to sign up (they expect to balloon to five million users by next year). Problem is, when every user is a burden on the system. This was no problem for previous subscription models, like newspapers in the days of yore who could rely on advertising. Problem is, it can be a big problem for subscription models, like newspapers now. And it may be better to be a little more selective. Those going to The Last Jedi every night of the week were already committed to shoveling billions of dollars into Disney’s coffers, only now they did it on MoviePass’s dime, contributing nothing to the company’s business plan which hinges on getting more people to the movies more often.
This goal is what ultimately keeps me sympathetic to MoviePass even while many corners of the Internet seem to be rehearsing dances to perform on its grave. Company co-founder Stacy Spikes voiced his vision way back in 2011 after a thwarted attempt to launch MoviePass at a cost of $50 per month with the cooperation of the major exhibitors and studios. “If studios say they are not interested in being able to talk to their customers, knowing what they are thinking and being able to notify them of things like ancillary items, and that theater owners aren’t interested in having these people go to the movies more, and drive up concessions sales, and having us put all this in the palms of their hands, then I’m in the wrong business.”
His frustration is understandable – studios and especially chain theater owners have been poor stewards of the movie-going experience. Competition from streaming and home theater technology has threatened to send a night at the movie theater the way of a night at the live theater – a prohibitively expensive luxury event. Movie theaters have shown little imagination addressing this beyond adding to the perception with premiums on ticket prices for dinners and big comfy seats like the ones you left at home. MoviePass at its best aims to reverse the trend and recreate the core of movie audiences – those looking to spend less, but more often.
AMC – the most vocal critic of the MoviePass model since the beginning – recently launched their own subscription pass ($19.95/month for 3 movies, no restrictions, discounts on concessions and no fee for obtaining tickets online) and Alamo Drafthouse is beta testing their own subscription plan. If the naysayers are right and MoviePass isn’t long for this world, hopefully their legacy will at least be forcing theaters to rethink their pricing and the direction customers would like to see for movie exhibition. In the meantime, MoviePass has worked for the past six months. We’ll see what happens in the next six.
Sidenote: I mentioned a message I sent to customer service soon after signing up for MoviePass that hadn’t received a response. I received a belated reply about a month after its submission – soon after I posted the first article about MoviePass. In case that wasn’t a coincidence: Mitch, send me one of those new MoviePass hoodies this time! You probably have my location.
(And, in fairness, I recently had occasion to contact customer service again and once I got through they resolved my issue quickly and even refunded the cost of the ticket I had purchased when the problem occurred.)