July 5, 2019
Fiscally challenged MoviePass suspended service midday July 4 for an indefinite period of time to revamp its app.
The eight-year-old movie ticket subscription pioneer, in an email to subscribers, said the stoppage was in order to “provide the level of service you deserve.”
“We have listened and we understand the frustrations of our subscribers,” Mitch Lowe, CEO of MoviePass, said in the July 3 email. “We plan to make this improvement by utilizing an enhanced technology platform, which is in the final stages of completion.”
During the shutdown, MoviePass will not take on new subscribers. Existing subs will be credited for the number of affected days once the service continues.
Owned and operated by Helios Matheson Analytics, the service at its peak generated more than 3 million subscribers paying $9.95 for daily access to theatrical releases.
The business model quickly proved unsustainable as MoviePass paid exhibitors face value for each ticket consumed by subscribers. Unable to reduce ticket fees and market subscriber data to exhibitors, the service hemorrhaged money — losing $329.3 million, on revenue of $232.3 million in 2018.
In March Helios said it received nearly $6 million in funding from an unidentified investor.
“There’s never a good time to have to do this,” Lowe said. “But to complete the improved version of our app, one that we believe will provide a much better experience for our subscribers, it has to be done.”
Regardless, movie subscription service appears here to stay as exhibitors grapple with burgeoning over-the-top video competitors.
AMC Stubs A-List service has more than 800,000 subs, while rival Regal Cinemas is working on its own branded service. Atom Tickets and Cinemark have separate subscription plans in place.