Five years ago the movie-going world witnessed the epic catastrophe of MoviePass, the movie ticket subscription company that for a time offered subscribers a movie of their choice at the theater of their choice every single day for only $9.95/month. MoviePass attempted to break into the theatrical exhibition market through sheer numbers of subscribers. To the surprise of no intelligent person, this offer of goods produced by other companies at potentially %.00007 of the cost* did not work out financially. Add in weekly corporate scandals and maltreatment of these subscribers that the company was using as battering rams on the gates of major theater chains, and the legacy of MoviePass was as much about making ruinous customer service decisions as it was about regrowing movie theater attendance.
It seems like just yesterday, but the MoviePass comet flamed out before the pandemic, a worldwide disaster that ironically might have helped the new MoviePass strategy. Their business model became based on gaining more and more new customers while preventing current customers from actually using the benefits of their subscription (there is precedence for this, but it’s not the “gym membership” model that MoviePass often gets compared to, it was closer to how the American insurance industry works, where companies have incentives to sell benefits and then do their best not to let the customer actually gain access to them). In the 2017-2019 window where new CEO Mitch Lowe took the company from obscurity to headline news, the company’s focus became changed from “Let’s all go to the movies!” to the less inspiring Daddy Warbucks quote “I love money, I love power, I love capitalism!” Two years ago, co-founder Stacy Spikes, who had been unceremoniously dumped from the board via email during its downward spiral, reacquired the company and began a relaunch of MoviePass, beta testing in a few markets before going nationwide last spring.
All this has been described many places – on this site, in a memoir by Spikes called Black Founder:The Hidden Power of Being an Outsider and in the company-friendly documentary MoviePass, MovieCrash. I’ve been mostly tried to document the MoviePass experiment from the perspective of the user. I was in one of those beta test markets, and I’ve been back on the MoviePass wagon for about a year and a half. So is this a triumphant return of a so-called market disrupter? Or another rug destined to be pulled out from under lovers of the movie theater?
I think many people don’t realize how long MoviePass has been around. The company was founded back in 2011 by Spikes and Hamet Watt, meaning it was in operation for six years with steeper monthly costs before the magical $9.95 era began. As he details in Black Founder, Spikes had the idea long enough ago that he was testing versions that operated via text messaging before smartphones were on the market. The return of Spikes to the head of the company is the first positive sign for stability of operations – or at least stability of mission – for MoviePass. Spikes is a glad-handing business guy by profession, but also a genuine lover of music and movies. He was around for the beginning of the end for MoviePass but highly critical of the treatment of its customers which contributed to his ouster by the people he brought in to give the company a boost in the first place.
Granted, much of my source on this comes from Spikes’ own words, but the public record is pretty consistent with his goal of making movies more affordable and raising all boats – theaters, studios, audiences – with the tide. And he wasn’t wrong – MoviePass is a good idea. The Loews theater chain knew it but got bought out by AMC Theaters before they could partner in the venture in its earliest days. AMC Theaters also knew it, but they couldn’t iron out terms with the studios.** AMC became one of the company’s biggest antagonists in the 2017-19 era, but (along with other major US theater chains) stole the idea for their own ticket subscription options.
The lack of support from theaters themselves eventually begat the decision to bring on Mitch Lowe as CEO which begat the drop in subscription price and the insanity that followed. Mitch Lowe (not to be confused with the Lowes theater chain mentioned earlier) can be blamed for most all the company’s dirty deeds to come but he was right about one thing: the price was too high. Prior to the fall of 2017, MoviePass subscriptions were at least $30 per month (and up to $45 for higher-price markets) for a movie every 24-hours, and even this was becoming unsustainable for the company. On his hiring, Lowe’s goal was to find a feasible $20 plan. Then the company was sold to data analytics company Helios and Matheson. This is when the game became to acquire as many people (and their data), financial losses be damned. Thus the $9.95 Unlimited Plan which finally and hilariously bankrupted H&M.
The lop-sided math of the $9.95 plan made it plainly unsustainable, but it did prove what price point would get the public’s attention. Lowe swung too far, giving away hundreds of dollars of movie tickets for too little money, and even when the company attempted to roll back the deal and limit the number of movies per month, the plans didn’t account for regional price differences or the cost of the tickets themselves (a regular Tuesday matinee in Kansas City costs $6, the same film on a Friday evening in Times Square costs over $22). MoviePass as run by Lowe didn’t want people who thought about these things, it wanted sheep running into pen and handing over their data on the way. But he had to resort to unethical means – locking users out, blocking showtimes for the heaviest users – to keep away the customers paying attention to how best to use the service.
The new-look MoviePass accounts for math-and-movie-nerds. Instead of a set number of movies (or infinite movies) for your monthly fee, your subscription purchases credits. Every day, each showtime in your area is assigned a certain credit cost, accessible on the MoviePass app (which is, like the card, now a sleek black instead of an aggressive red). The credit cost of each showtime is determined mostly by the time of day and sometimes by the popularity of the title. Matinees will be fewer credits, major blockbuster releases will be more credits (although I’ve noticed fewer adjustments for indie vs. studio films of late). Unused credits get carried over one month, meaning you can take a month off without losing the investment, or carry over ragged remainder credits towards an extra ticket the next month.
This gives MoviePass the flexibility to account for variance in ticket prices without resorting to barring users from certain movies like in the past. I imagine it leaves the door open for partnership with theater chains if they come around – share a little of the revenue, and your credit price goes down, driving more MoviePass traffic your way. This little chart sort of explains it, and also has the pleasing label of Basic applied to a theoretical one-movie-per month “superhero superfan.” I have had this Basic plan which gets me 34 credits for $10. Matinees today are 20 credits apiece and the evening is 23.
As you can see, my plan doesn’t have enough credits for a full two movies this month at today’s rates, I would have to roll over credits to see benefit. In reality most of my movie-going is on discount Tuesdays when credits are usually in the 12-17 range. Back in the spring of 2023 I saw How to Blow Up a Pipeline for 7 credits. Doubt I’ll see that rate a lot again (also, early plans gave you fewer credits), but the summer season does seem to have an effect on the rates – the last time I saw something for under 15 was when I spent 12 credits on Civil War last spring. If they had availability for premium screening formats through the app, I would consider stepping up to the $20 tier which slightly more than doubles your credits at 72.
Some of you are piecing together if your movie-going habits are on the right pace to benefit and some of you are wondering why the hell I’m sweating over the calculator this much. Yes, the downside to all this is MoviePass feels less like a movie subscription program – “Netflix but for movie theaters” as it was originally sold – and more like a movie discount program. If you needed any further proof that MoviePass is now built for the math-minded, look at the Reservations tab in the app which not only details every movie you’ve used the pass to see and how many credits it cost, but calculates your average savings as a percentage at the top. I have an average monthly savings of 47% and average annual savings of 43%. I don’t know why those are two different numbers, but I do know that means I’ve saved probably around $150 on movie tickets in the last 18 months.
So there you go, the company that was sunk by not giving enough thought to the numbers now arguably requires too much thought to see (real) benefit. “See Unlimited Movies for Less Than $10!” was a lot sexier pitch than “Average 45% savings on movies over the course of the year!” Those crazy days of 2017-19 showed there’s still audiences for theaters, but I don’t know if those same audiences are big enough on math for MoviePass to be their guide again.
* In fairness, this extreme percentage is calculated on the unlikely – but possible- scenario in the earliest months of the Unlimited Plan of somebody paying full east coast ticket price every day for a 31-day month. If we calculate based on somebody going to a movie three times a month at the 2017 national average of $8.97 per ticket, MoviePass recouped a whopping 1.2 cents per dollar they spent on the transactions (.012%), although I’m not confident that fraction of a penny would land in their coffers.
**Less relevantly but more interestingly, Robert DeNiro and Grace Hightower knew it and almost became 50% partners in the company at one point.