MoviePass Adds a Million Subscribers, Even If Theaters Aren’t Sold on It
nytimes.com
nytimes.com
Theaters will always have a place in entertainment. And with the recent addition of la-z-boy furniture and reserved seating, there's simply no contest. Now, I want to experience all my favorite films in the communal environment of a theater. Would be great to be able to 'upvote' classic films and have them play at a local house, and watch along with others who like it enough to be there, place and time. Maybe that's where MoviePass is headed?
A theater chain in India is trying something similar, though at full price and not discounted like moviepass
http://indianexpress.com/article/technology/tech-news-techno...
Combined with ushers walking up and down the aisle, people scooching by to go to the restroom, employees checking the emergency exits at the side of the screen and there's no clear winner.
There's still some movies I want to experience on the big screen, with insane audio, and D-BOX seats.
But for the most part movies at home still win due to the ability to pause and agoraphobia.
> Unless you can built a $100k theatre room, there is definitely a clear winner. But if course it isn't for everyone.
Exactly, I don't think every movie I watch needs a 100K screen, at all.
But on the other hand I would pay $50+ for that kind of entertainment. I enjoy the experience as it isnt tolerable to have such overpowering speakers in a home setup, or especially in apartment complexes. It is a well done escape.
I wouldnt pay that much for a movie-going date or children’s tickets though, with the high chance that they arent into it
This is how my trip to the movie theaters have been going, local IMAX had people coughing, loud food eaters, kids talking, people surfing phones.
The looking for parking, waiting in line, the annoyance of people.
I'd rather just rent/buy the blueray.
1. 10ft projector screen (You can just frame and paint a wall for this, seriously) 2. Surround sound 3. Electric reclining leather seats 4. Popcorn machine 5. Coke machine 6. Located in the basement
This VASTLY beats out any movie experience I have ever had at a theater.
So they sell tickets for way under what they cost, they take their cut and pass it on to the theater and studio, and then claim money somehow that simply putting butts in seats is their value add.
It just doesn't make sense.
Why do you need to sneak anything in though? Do cinemas care about people taking in their own food and drinks? Is it in their terms and conditions of sale that you cannot do that? If it is then it isn't enforced.
I don't think I even see let alone talk to any members of staff when I go to the cinema these days - it's all automated ticket machines and then you just go into the theatre for your film. There's nobody to enforce it even if they were going to.
People talk online like they're master criminals for sneaking in a packet of sweets but really I don't think anyone even remotely cares.
I've had conversations with them about coffee as they don't sell it there but they have been adamant about preventing me from bringing it in.
Most of the time the employees had no idea what the cards were, confused as to why I needed to run 2 tickets as individual transactions on separate cards. Maybe this was before it really became an issue for them? Are the policies about not giving rewards official?
Do you really want to risk the embarrassment of being asked to throw your sneaked in candy away? There's sort of a societal status-pressure to stop doing this sort of small rule-breaking once you reach a certain age.
Well I personally just buy a cup of tea and don't eat during movies anyway, but I wasn't talking about myself, rather people in general.
Ask me to throw away my outside food or beverage, and I will ask you to either leave me alone and give me what I paid for, or refund my ticket price in cash, so that I can walk myself to a theater willing to do that without angling for additional passes at my wallet. It is not my responsibility to support any captive-audience business model, nor do I have any desire to put up with non-negotiable, one-sided adhesion contracts.
The societal pressure should be for theaters to stop doing this sort of small, self-serving rule-making.
The business is selling tickets to shows. That can't be the loss-leader for some other profitable business that goes on once people walk in the door. If I buy a ticket, I expect the theater to leave me in peace to enjoy the show. I don't want it fleecing me coming and going, like a bunch of carnival operators.
The only rules I implicitly agree to are those that ensure that no customer will detract from the other customers' enjoyment. Silence your phones. Silence yourselves. Keep your shoes on. If you must make out with your companion, do it quietly and non-obviously. Deposit trash in the designated receptacles. These are just ordinary rules for not being an ass in public.
I go to a movie theater to see movies. I don't go to an concession stand that happens to also show movies to buy candy, liquid candy, and popcorn at grossly overinflated prices. I can get all of those things at better price, selection, and quality from businesses that don't have theaters attached. Those businesses have no problems covering their overhead and operating costs without showing the movies. And I can't help noticing that they always have plenty of employees manning the popcorn machines, but whenever I have to find someone to fix the sound or picture on the movie, there are tumbleweeds blowing through the corridors.
It's the same reason I don't go into the secure area of an airport to buy sandwiches and coffee. I go to an airport to board a plane and go somewhere else. If I consider buying sandwiches on the way, they had better be the same price and quality as those found in a mall food court, where people are free to come and go, or those businesses are not getting my money. They never are, so I bring food through security if I can't just wait to eat until reaching my destination.
It is one thing to charge more because you are offering a convenience. It is another thing entirely to charge more because you are compensating for an artificially imposed inconvenience. The former is acceptable, and the latter is deplorable.
Honestly, even if they had what I wanted, I'd still be dismayed to pay their price for it. It's such an extreme price hike that it feels like I'm being taken advantage of. Especially on top of the $20-30 that I'm paying simply to see a movie with a bunch of people talking and being annoying. The whole thing makes me quite price sensitive, I guess.
Another thing is that I don't often care about eating tons of things. A small bag of nuts is plenty for me. I don't need the massive American sized popcorn. If they offered human sized portions of things I'd be more tempted - but then again, it's all sweets anyway.
But while we're sharing anecdotes, I've never heard of someone sneaking in a large-gulp Coke and a bucket of popcorn, for one. -- The two things people seem to unanimously be holding in their arms as they enter the movie.
Except he had overcooked it and it smelled terrible.
Now, I simply don't buy anything at the concession stand at all. Years of eating poorly have taken their toll and I'm paying the price.
0: https://www.amctheatres.com/food-and-drink/dine-in/full-serv... 1: https://www.showcasecinemas.com/dining
Perhaps they're worried that people will switch to movie pass, and then Movie pass will fail in a few years, and those subscribers will then stop going to the cinema entirely?
1. If MoviePass doesn't work, AMC's customer service people will get yelled at for something outside of their control. This damages AMC's brand and wastes the time of their CS. 2. People will get used to MoviePass and then it will go bankrupt. This will reduce their likelihood to attend movies because they are now no longer used to paying the high prices set by studios.
I'm not sure how much data the theaters can gather from credit card ticket purchases, I would expect they glean nearly no data at all from cash purchases. I suspect they are trying to fill in these blanks with the goofy phone apps they are aggressively pushing.
In my opinion, MoviePass can likely sell a lot of this data back to to the companies that produce the films as well as the theater chains themselves.
That's not how it works. You select a specific movie in a specific theater in their app, it loads the exact amount on to the moviepass mastercard, and then you purchase the ticket with the mastercard. The theater gets the full ticket price.
They claim they're going to be harvesting the data from their customers and sell that to make a profit. I personally think it's a red herring, if I were in their shoes I'd aggressively undercut the price, secure a dominant market position, and then place pressure on chains to play ball, or raise the price of the subscription in small increments ala Netflix. Honestly, it'll probably be a combination of both.
This all can sound a bit nefarious but at the same time I don't see the movie theater industry surviving without some sort of subscription model such as this. AMC, Regal, and Cinemark are squandering their market dominance by not implementing some sort of similar plan for their own specific chain (cinemark's $8.99/mo plan isn't even comprable).
Aren't they? For $10/mo, I can go see one movie a day, no additional cost to me. And it's not the theater chains that need convincing- it's the studios. The theaters just aren't permitted to take any sizable percentage of the ticket price.
If anything, "butts in seats" shows demand. If demand drives prices, then the studios think the prices can go up because demand is up. If MoviePass's plan is to profit from data, I personally don't have faith in their future.
> If I were in their shoes, I'd [do what they're doing right now and] agressively undercut the price...
I also agree, if they're telling the truth that their plan is to make their earnings off the data, yes I don't have faith either. I'm saying, if they managed to pull a miracle and get a majority of the movie-going public on to movie pass, they could be in a position to then negotiate with the theaters (and other forces down the line) to strong-arm their way into profitability. Even if it's just "oh hey pay us and we'll feature your theatre to our users in the area".
This is all conjecture, arm-chair theory.
Instead of $10 a month think of it as $120 a year. If a theater charges $12 a ticket (just to pull a round yet realistic number that means less than a movie a month at $10/month) then an annualized MoviePass subscription breaks even at 10 tickets per year.
As somebody who likes to go to the movies, how many times did you go to a theater this year, really? Six, seven times maybe? Maybe once in the late winter or spring, two or three times in the summer, once in the fall, whatever Star Wars movie comes out in the winter, maybe another time with your family during the holidays?
The truth is that people don't really change their media consumption habits, in aggregate, when they're presented with unlimited subscriptions. People just like to feel like they could get anything they want and that they don't have to look at the price tag anymore, but they don't actually consume more in aggregate. Sure, you get some binge subscribers who exploit the system, but they're not enough to bring down the entire enterprise.
If the industry could transition from $10/album to $10/month unlimited music subscriptions, from $10 eBooks to $10/month Kindle Unlimited eBook subscriptions, from $10 DVDs (actually, usually more than that) to $10/month Netflix subscriptions, then why can't the industry support a transition from $10 movie tickets to $10/month theater subscriptions?
That MoviePass isn't profitable right now isn't so much because exploitation is more widespread than the MoviePass founders expected, and more because it's still new enough that most subscribers are going through their initial binges before they'll settle into their normative consumption habits.
The average American adult goes to some five movies per year [0]. Increasing that to your new rate of consumption of roughly once per week - more than fifty movies per year - would be an order of magnitude. Even if attendance increased only to the break-even point, it would basically double attendance.
So either MoviePass has no or little affect on aggregate movie attendance, in which case they make money hand-over-fist for extracting twice the money from aggregate subscribers for the same amount of aggregate product, or MoviePass has a strong positive affect on attendance, in which case there are other avenues for profits, as other people have mentioned - data mining, concessions, etc.
[0] https://www.marketingcharts.com/industries/media-and-enterta...
I doubt many people get movie pass and lose money on it frankly. Somewhere around 1-5%. If you are going to only 5 movies a year, and price isn't the issue, you have no reason to buy MoviePass. The majority of the customers are likely those who they will lose money on.
I think on average they are losing quite a lot per user, and the data can't be all that useful.
If it takes a year to get useful data, and they lose an average of $100 a year per person (a bit under two movies a month per person on average), is each person's data worth that?
As far as concessions, big theatres hate MoviePass right now and I don't see them getting a cut of that confessions profits anytime soon. I'm riding the wave of free movies but doubt they last. I think it's far more likely it pressures the industry to change its model but they aren't going to be getting rich off of it without a strong pivot from the current business model.
I'm also a lot more willing to spend $8 for a tub of popcorn when it "cost me $0" to see the movie (I know). Before Moviepass I was going to the movies about 2x/mo, and now it is up to maybe 3x, depending on whats out there and how busy I am.
Especially for movie theaters, where the marginal cost of additional filmgoers isn't as high.
If I watch a second Netflix movie, Netflix has to spend 2x as much on bandwidth to serve it to me.
If I theater hop, the theater doesn't really have to spend anything more. The only cost to the theater is the opportunity cost of me not paying to see a movie I otherwise would have paid to see.
In other words, as long as the MoviePass subscription cost is higher than the opportunity cost of losing the average moviegoer's ticket revenue, then everyone wins. In fact, the theater probably really, REALLY wins because the more often I'm at the theater, the more often I have a chance to buy concessions.
Netflix has to spend 2x as much on bandwidth
1. You claim that unlimited subscriptions doesn't change behavior in aggregate, but do you have any evidence for this? Just look at Netflix - it has changed tons of people's behavior to watch more TV on Netflix than other entertainmentt options.
2. Your other examples of music subscriptions, eBooks, Netflix etc. aren't relevant because the economics are totally different. MoviePass is still paying full price for each movie. Spotify certainly isn't paying some sort of "full price" for each song you listen to. It seems like MoviePass would be most attractive to those who are most likely to take advantage of being able to watch tons of movies.
I agree with other commenters, I think MoviePass is trying to get mind share and heft so it can then be in a good negotiating position with theaters. That is, if you get a couple of theater chains to come on and agree to better economics with the subscription model, then consumers may start only going to MoviePass-supported theaters, putting MoviePass in a much stronger negotiating position.
You're paying $10 a month for $20+ a month. Of course subscriptions are going through the roof. It's free money.
I think if you wanted to make a blue apron level unicorn, just selling a subscription for a $20 bill in an envelope every month for $10/month would give you a better user growth story with lower churn rates and customer acquisition costs than this.
Outside of Friday/Saturday night, shows are pretty unlikely to be sold out.
Plus, if you're at the theater, you'll buy popcorn, candy, and drinks, which is where the actual theater makes most of their money.
So you can pre-book and reserve seats, but only in person. If you live very close to a theater, you could pre-book at lunchtime and come back that evening to watch the movie, for example.
It definitely requires you to be physically present, though. There is no online ticket-buying with MoviePass.
The price point of MoviePass is interesting and 24 USD (~20 EUR) is obviously much more than the 10 USD quoted here. Still, buying only at the theater is annoying. I prefer making a seat reservation and arriving max 5 minutes before the movie starts (there are loads of advertisements anyway).
Downsize of the Dutch unlimited options: you still have to arrive at least 30 minutes early and this gets annoying really fast (30 minutes minimum early is 35-40 in practice plus the 10-15 minutes of watching advertisements you've seen before)... quickly turns into loads of wasted time. I tried when they had a special (4 months for 40 EUR, so 10 EUR/month).
[0] https://www.costco.com/MoviePass-and-Fandor-12-Month-Subscri...
The Costco page stresses that you have to have a mobile device with the Moviepass app running when you check in at the theater, but Moviepass's own signup process doesn't say that.
I wonder if the privacy-minded folks on HN are averse to this. Or is it ok since you're getting discounted movie tickets in return?
I also wonder if they're going to take movie consumption data and marry it with other data they can glean about you (preferred theater location, residence and/or work from geolocation when you open the app, etc.). That data could be sold to folks other than just studios, since they can market related products or correlated products to you.
I'm fairly privacy-paranoid in general, but in this case, I'm maybe okay with it.
Do the theaters share purchasing information with studios or others? I would think that in the age of privacy policies, they would have to tell you if they want to do this.
https://www.technologyreview.com/s/607938/google-now-tracks-...
https://money.stackexchange.com/questions/21273/do-can-credi...
https://www.creditcards.com/credit-card-news/retailer-data-t...
> The Song-Beverly Act prohibits retailers from requiring a consumer to provide personally identifiable information (PII) as a condition to payment by credit card and recording that information during the credit card transaction. The Act defines PII as including the cardholder’s address and telephone number, and courts have repeatedly found that the definition includes other information such as ZIP codes and email addresses. Class actions against retailers in California based on alleged violations of the Act have become commonplace and several other states have also adopted their own laws modeled on Song-Beverly.
1: https://www.lexology.com/library/detail.aspx?g=329a7064-6278...
So I can get 30 movies per month for $10 or 1 movie per month plus 20% off concessions for $9? It'd take a helluva lot of popcorn to make that math add up...
Otherwise, it's just unsustainable. They've got to be burning through VC money like kindling.
From the consumer side, if people think they're going to see at least 2 movies per month, then this is a win. So the bar is pretty low, and I could see the mean/median being around 3.5 movies per month. I'm sure there are some heavy users, but there are probably also folks who forget to use it some months (but don't cancel).
there are only so many movies that a given person would want to see in one month.
True, for the given person you're thinking about. What about a person on disability? A cinephile? A teenager who has the whole summer off?
It's a tragedy of the commons problem. If you have one movie nut who goes to 12 movies a month (not difficult if you live in a city a short bus ride or walk to a theater) then you need 11 users to forget they have it. The outliers have a potential 30x rate.
Not to mention that those outliers could be going to IMAX 3D showings in a major city at a premium theater ($22.75 at the Chinese Theater, for instance), and you've got a $682.50 monthly bill for one user without violating the TOS.
As far as I can tell they're treating this like a gym membership, but ignoring the fundamental difference: Going to the gym sucks, going to the movies is a blast.
This is why I think as the service continues (and the money backing it dries up), they'll introduce more and more restrictions.
It's actually an adverse selection problem, like in insurance markets. It has some similar features as tragedy of the commons, but IMO it's not as apt a descriptor. Totally agree that they have the problem you describe, whatever it's called.
> MoviePass does allow multiple viewings of the same movie
I had seen on reddit people say that they couldn't select the same movie twice.
You can't actually use MoviePass for premium showings (3D, IMAX, etc.). It only works for standard 2D showings.
I've tried a dozen browser combinations (Chrome, Opera, mobile, in and out of Incognito mode, 3 devices, all with Javascript enabled for everyone) and can only get "Oops! Something went wrong!" with the map feature. I'd be fine with an ordered list but see no such option on their site.
Studios are probably too afraid of piracy to accept that - theatrical distribution is an effective means of restricting content distribution and of quality control.
A service with such an unrealistic price per month that it should be impossible to lose subscribers and be just as impossible to be sustainable once early investor money dries up. It just reminds me of the worst of the early internet businesses, mainly all the grocery delivery attempts and now boutique dinner delivery services
all the theater chains need to do is wait it out, count their money from all these effectively free patrons, and then launch their own if desired version. T
If that's what happens in the worst case, then that would be a significant change in the business model of theaters/theater chains - and by extension, the movie industry.
And that is possibly the worst case now. Keep in mind the data this company is collecting from their subscribers could be used to help smaller theaters fill their seats at the expense of attendance at larger chains.
MoviePass is definitely making things easier for the consumer. One subscription, any theater at any time.
It's hardly unrealistic. If theaters are wondering why they have so much trouble filling seats, they can look to this mode of thinking. Theaters (save for maybe some chains around me like MJR and Emagine) don't seem to understand how markets work. They've been raising the prices continuously and wondering why their sales have dropped, without giving much justification for those raised costs (the theaters I mentioned either typically sell cheaper than others in the case of MJR, or they have very high-end experiences in the case of Emagine).
AMC, since they've been the most vocal opponent to moviepass, are terribly guilty of this. The only reason I use their theaters is either because it's close to me (I live less than a mile away from one), or because my friends want to go to one for whatever reason. They're always terribly maintained, it looks like their staff doesn't care to clean, I can hear noise, including intelligible dialog, from other movies while watching mine, and their concession price gouging is some of the worst.
If they want to start getting people back in theaters, they need to either deliver a better experience or severely lower their prices, though probably both.
A bigger issue (for some people) is that it doesn't cover 3D films and other such fancy versions of films that also have regular versions. I personally don't care (I don't like the 3D ones) but I imagine that could be undesirable. Though, technically, there's nothing to stop you from using moviepass to see those kinds of things, but it's against their rules, so if they catch you they could cancel your subscription. I'm not sure how aggressively they check up on those things though.
MoviePass will buy all your movies in a month for $10. They plan to make it back on monetized data. So one user ups his monthly movie consumption from 1 to 12. Let's say they get tickets at a bargain, $10 each. MP is paying > $100 a month to find out what movies this guy wants to see but isn't actually willing to pay for.[0]
That's puzzling enough, but, sure, data is a fun paradox, some kind of ubiquitous unobtanium, so for all I know they're getting it cheap. The actor in this story that really confuses me is AMC. "Not welcome here?" Why again?
Listen AMC, I'm going to let you in on something. For every $10 "someone" pays MoviePass, they are willing to buy 30 tickets.
No, look, no. I'm not saying "use proxies," like Redbox did to buy DVDs when the studios tried to cut them out of the system.[1]
Because, while I have no idea whether that's legal, I do know you're terrified of "value" customers filling seats. Discount entertainment terrifies you because you make almost nothing on ticket sales and all your profit from high-priced concessions. You need whales in seats. It's classic f2p, just somehow with a magically sustainable[2] exorbitant cost of admission tacked on to help you rent content at a ridiculous premium.[3]
So--drumoll--just advertise (hand out?) MoviePass subscriptions when people buy concessions. Anyone who already eats your food is already a w--, er, your target.[4] Not only will you get the MP ticket sales, so you can show foot traffic,[5] but also, bonus!--this will free up more of your customers' income for those ridiculously priced concessions.
[0] I have some cars I'd love to own, so if anyone wants to buy them for me, I will let them know which ones. I'll sign a contract for exclusive use of that data and everything.
[1] http://www.slashfilm.com/retail-conspires-against-redbox-by-...
Honestly though, the studios are probably already using proxies to buy MP subscriptions, just like how publishing companies buy their own books in bulk to drive up numbers. [1a] If not, ahem, studios, I'm going to let you in on something...
[1a] http://www.latimes.com/books/la-et-jc-handbook-for-mortals-b...
[2] Well, "sustainable" is TBD. But hey, people still buy cable for some reason. Ok, bad analogy. Uh, people still listen to AM radio? Hang in there, you too can be the niche medium of the future. Just start advertising dubious health and investment products before the films, you'll get there.
[3] Sidenote - This whole new releases model -- Basically the studios are trying to free ride on marketing? Which is the magic sauce that turns lousy movies into hits, so says NPR.[3a] What if AMC just played old indie marathons like the drive in, or the campus theater, for like a dollar a ticket, but advertised the hell out of them? Oh, right, value customers... Ok, go the other way. Follow the Karaoke Bangs where you can just stream whatever you want on a big screen in a small room, hang out with your friends, and maybe add steak dinners and champagne on demand. Just become a full service restaurant with private rooms that look like people's fantasy living room already.
[3a] https://www.npr.org/2015/08/21/433402308/how-marketing-machi...
[4] Here's where I clumsily avoid turning 'whale' into some kind of lazy fat joke. Look, weight is tough, no one needs to pile on. But also look, AMC has promotions for bags of popcorn with over a thousand Calories and drinks that are nearly a liter and a half. Sure, popcorn is for "sharing," but how does 54 oz of sugar water fit in any healthy diet? You're making Big Tobacco look like... like... Michael Pollan. Atul Gawande? Something something health expert.
[5] Welcome to the late 2010s, where the theory that eyeballs are better than revenue has been conclusively proven beyond any doubt, even if no one fully understands how.
The theater experience on the other hand, is getting less and less appealing as home audio/video tech continues to improve at a furious pace.
To your last point, none of those movies I watched in a theater, I waited until they were released to my online video service and I could watch from the comfort of my couch.
Thinking a bit more, I had low hopes for "Valerian" and "Jack Ryan", and high hopes for "Atomic Blonde", even though those turned out to be the opposite in reality. To my original point, I think that what killed the theater experience for me. I'm afraid to go spend $15 on a movie that _might_ suck. I'd rather spend half that and be able to leave if it's terrible.