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Comment by slg | Hacker News Reader

It is even more basic than that. Amazon, Uber, Netflix, and almost any other successful and established business creates value. MoviePass is not creating value and is simply trying to purchase its way into being a middleman between theaters and theater goers. If their pricing structure ends up showing the slightest chance of generating more revenue for the theater industry as a whole, there is nothing stopping the theaters themselves from adopting the pricing structure themselves and cutting MoviePass out.

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As a Moviepass subscriber, they create a lot of value for me.

I can go to any movie I want at any local theater. That is a lot better than subscribing to five different plans, one for each theater.

Well you can just subscribe to the theater closest to you. Why would you want to go to the ones across town?

This may not be common outside urban areas, but I have theaters from 4 different chains all within a 40 minute walk, and I've visited them all within the last few months. If I were asked to pick just one to subscribe to, I'm not sure how I'd choose.

Why don't you buy the tickets online whe you want to go to the cinema? what do you get by subscribing? how much would it cost?

In the UK, several cinema chains offer subscriptions where, by buying an annual subscription, you can see as many films as you like. The fee is equivalent to somewhere between 2 and 4 movies per month.

If you're visiting the cinema very regularly, this saves money.

They can do this because they own the theatre, so when a subscription is used, it only costs them the _opportunity_ cost of one seat - which is very little, unless the showing is sold out, and they still make money on snacks. As MoviePass doesn't own the theatres, they pay the _retail_ price for every ticket a subscriber uses.

1) theaters pay a sliding percentage of the ticket to the distributor, as high as 90% in the first week(s) a film is out, dropping the longer the film has been in theaters. This means (unless the chain is cheating the distributor, which admittedly has happened for brief periods) that seat is a very real cost to the theater.

2) with reserved seating, I'm much less likely to buy a ticket if the showing is almost full, so those filled seats can reduce additional ticket sales.

Different movies.

I have 3 theaters within a 20 minute drive. I might choose one over the other because of movie availability and showtimes.

I'd counter that MoviePass is not creating any value for you, they're literally just paying for you. That's not anything special.

I disagree. They are saving me a ton of money. To me as a customer, that is a lot of value.

I sure hope that Moviepass and the theaters can figure out a way to make it work.

You are misunderstanding the point. We aren't saying that MoviePass doesn't provide value for customers. We are saying that MoviePass doesn't create any value for customers. They are not increasing supply. They are not increasing demand. They are not adding efficiency. They are simply paying for the money you save with capital from investors. Every dollar you save on a movie ticket is a dollar that MoviePass pays to the theater. That is great for quick growth but I can't think of a single successful business that works that way.

And some are even beginning to experiment as it is, such as Cinemark’s Movie Club.

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