MoviePass

About

MoviePass is an subscription service for purchasing movie tickets. Users pay a flat fee and, depending on their plan, are allowed to purchase a certain number of movie tickets per month. The service has been the subject of numerous controversies due to its economic model, which strongly favors the consumer, leading many to question the company's sustainability.

History

Entrepreneurs Stacy Spikes and Hamet Watt founded MoviePass in 2011. The original incarnation of the service followed a voucher system, requiring users to print tickets out at home.^[1]

In 2012, the service launched a beta version of their credit card system, which was reloaded each time the user selects a ticket.^[2]

Pricing System

Four years later, MoviePass named former Netflix executive Mitch Lowe CEO. Shortly after, the company announced a tiered pricing structure, ranging between $20 per month to $100 per month.^[3]

Price Drop

As a result of the analytics firm Helios and Matheson purchasing a majority stake in MoviePass August 2017, the service dropped the price of the service to $9.95 per month for unlimited movies, allowing users to see as many as one movie per day. The drastic price drop led to overwhelming demand for the services and new subscribers complained of long wait times for service as well as to receive their MoviePass debit card.^[4]

The price drop led many to question how the company made money. MoviePass CEO explained that they intended to use a gym model, where the people who pay for the service but rarely use it, essentially pay for operations.

Features

While the service has offered various pricing structures throughout its tenure, its main function is to offer a subscription service for movie theaters. Using the proprietary app, users are able to see what movie theaters support the service and what films are available for viewing. After they select a time and date, the user checks in. They then use the debit card, which is refilled each time the user checks into a movie, to pay for the ticket.

Highlights

2018 Outage

On July 26th, 2018, MoviePass users reported outages of the service. Aside from theaters that offered MoviePass's e-ticketing service, the app was largely unavailable. The following day, it was reported that the outage was caused by a lack of funds, which the company replenished by receiving an emergency loan of $5 million.^[5]

When the outage ended, the service did not offer tickets to the weekends biggest opening, Mission Impossible: Fallout.

Over the next few days, many speculated on the future of MoviePass. Most reports from inside the company did not assuage concerns that the service may be coming to an end. Online, people joked about the future of the company as well as the presumed apocalyptic mood inside the company (examples below).

On July 31st, announced that they would be raising prices to $14.95 per month. Additionally, first-run films, particularly from major studios, would be blacked out for an extended period of time upon release.

Cancellation Issues

In August 2018, Moviepass announced several new policy changes, switching the base plan to three-movies per month for $9.95 per month. The plan, however, only allowed for two film options at a time, which are determined by Moviepass. As a result of the frequent changes, some users began attempting to cancel their subscriptions.

However, on August 13th, some people complained that while they have canceled their plans, their subscription has been reactivated. Others complained that while they attempted to cancel their plans, the Moviepass gave an error message when cancelation is selected (examples below).^[6]

On August 14th, Moviepass released a statement on the issues. They said:

On Monday, August 13th, we learned that some members encountered difficulty with the cancellation process. We have fixed the bugs that were causing the issue and we have confirmed that none of our members have been opted-in or converted to the new plan without their express permission. In addition, all cancellation requests are being correctly processed and no members were being blocked from canceling their accounts. We apologize for the inconvenience and ask that any impacted members contact customer support via the MoviePass app.

Search Interest

External References