MoviePass CEO Mitch Lowe Clarifies Location Tracking Comments

After Media Play News reported data tracking comments from MoviePass CEO Mitch Lowe March 2 at a Los Angeles conference, numerous news outlets picked up on the quote: “We watch how you drive from home to the movies.”

The full quote reads as follows: “We get an enormous amount of information. Since we mail you the card, we know your home address, of course, we know the makeup of that household, the kids, the age groups, the income. It’s all based on where you live. It’s not that we ask that. You can extrapolate that. Then because you are being tracked in your GPS by the phone, our patent basically turns on and off our payment system by hooking that card to the device ID on your phone, so we watch how you drive from home to the movies. We watch where you go afterwards, and so we know the movies you watch. We know all about you. We don’t sell that data. What we do is we use that data to market film.”

In response to the reaction to Lowe’s comments on tracking, Lowe wrote an open letter to MoviePass customers:

“While speaking at a conference in Los Angeles, through a mix of exuberance about our future and joking around, I mischaracterized how MoviePass locates our members and I need to fix that. It has raised a lot of concerns and I understand why.

First and foremost, I apologize for these comments and the concern they caused. At MoviePass, we take customer privacy extremely seriously. I would like to eliminate any misconceptions that we’re collecting location related data.

The MoviePass app currently uses standard location services capabilities on an opt-in basis. There are only two events that would prompt MoviePass to identify a member’s location. These include when a member requests to search for theaters nearby and when a member requests to check into a theater. Both events require both the app to be open and for the member to request the action.

MoviePass does not track and has never tracked or collected data on the location of our members at any point when the app is not active. In our recent update with Apple, we removed the background tracking capabilities. MoviePass does not use and has never used this feature.

Our goal at MoviePass has always been to encourage people to see more movies as they were meant to be seen — in the theater. We want to make our service available at a price anyone can afford and everyone can enjoy. While we do create partnerships with theaters and studios in which we offer statistical data on ticket use and other trends, we never share our members’ identities or personal information or personal data with anyone.

MoviePass takes its members’ privacy extremely seriously, and our current Terms of Use and Privacy Policy accurately state the ways in which we use data. If, in the future, MoviePass desires to expand how it uses data, we will amend our Privacy Policy and notify our members so that they will be afforded the opportunity to opt in or opt out of the MoviePass service. This is what our customers expect, what the law requires, and how we’ve always handled data. We want to assure everyone that we treat our members’ data with the utmost sensitivity. Your trust and enjoyment are the lifeblood of our service.”

MoviePass Facing PVOD Ending?

NEWS ANALYSIS – MoviePass, the upstart theatrical ticket subscription service, seeks to replicate the Netflix business model with movie-going consumers.

It’s a populist concept that gives subscribers daily access to a non-premium screening for $9.95 monthly fee. To date, the service has attracted more than 2 million subscribers — and plenty of controversy.

Since the service pays exhibitors full value for each ticket used by MoviePass subs, the business model is predicated upon users going to movies infrequently — and/or extracting revenue-sharing for tickets and concessions from exhibitors.

Ted Farnsworth, CEO of corporate parent Helios and Matheson Analytics, hasn’t been shy touting MoviePass’ industry-disrupting mojo, including data on sub activity before, during and after watching a movie.

“100 percent our business is viable — we have studios and distributors paying us right now. What I saw from day one is that whoever controls the theatre really controls all the other revenues,” Farnsworth told

Farnsworth contends the service will account for 15% of the domestic box office when it reaches 5 million subs.

“We are like the Airbnb of the theater business; we are selling as many tickets as the No. 4 theater chain in America on a monthly basis and we have no bricks and mortar, no infrastructure,” he said.

That’s the thing, MoviePass isn’t really like Airbnb at all. It doesn’t control the theater, exhibitors do. And unless it acquires a theatrical chain, it is far from the industry gatekeeper Farnsworth believe it is — no matter how many film festivals it sponsors.

In fact, MoviePass is less of threat than Premium VOD, the business model studios (except Disney) envisioned enabling users to access theatrical titles day-and-date with exhibitors or within the initial 17-day theatrical window.

Earlier this month Adam Aron, CEO of AMC Theatres, the nation’s largest theatrical chain, pronounced PVOD dead.

“That should be a relief to many of you,” Aron said on the fiscal call.

He said PVOD could only happen if “our shareholders’ interests” were fully compensated. AMC is looking at PVOD alternatives with studios to grow the fiscal pie for all parties involved.

It’s an opinion Aron shares about MoviePass, contending the subscription model is a “great concept” — depending upon who controls it.

Aron said several hundred thousand MoviePass subs visited AMC theaters in January — or about 2.7 visits per subscriber.

“They paid us approximately $11.90 per ticket, which means that MoviePass paid us in excess of $32 per sub that showed up at an AMC theater where they were charging [that sub] $9.95 a month. We don’t see how those numbers add up,” he said.

Aron disputes the value of moviegoer data MoviePass collects as leverage with exhibitors. He said the AMC Stubs membership program has 12.5 million households, or more than 32 million consumers, including extensive movie-going expenditures.

“We market to those people approximately 75 times a year, one-and-a-half times a week,” Aron said.

Michael Pachter, media analyst at Wedbush Securities in Los Angeles, says two or more visits per month on average would drive significant losses for MoviePass. He says the service is seeking a $3 cut per ticket, in addition to 25% of concessions.

Pachter contends MoviePass will continue to block subscriber entrance at higher-priced exhibitors — including blocking select movies outright — to save money. It will also have to raise the monthly price once it nears its projected 5 million sub count.

“Attendance at these rates in January indicates to us that these subscriber rates are ultimately unsustainable,” Pachter wrote in a note.

Atom Tickets Gets Additional $60M Funding

Theatrical moviegoers may be decreasing, but the battle to sell them tickets online is escalating.

Atom Tickets March 8 announced it secured more than $60 million in new capital from Fidelity Management & Research Co. – less than two years after raising $50 million in funding from Lionsgate, The Walt Disney Co. and Twentieth Century Fox Film, all of whom contributed to the new investment.

The funding comes as Atom competes with NBC Universal-owned Fandango and subscription ticket service, MoviePass, to establish market share as gatekeepers in the margin-challenged theatrical business.

Launched in 2016, the Atom Tickets app tripled its users and ticket sales in one year. The service features advance ticket purchasing, the ability to invite friends and sit together while paying separately and concessions ordering.

In the last year, Atom Tickets formed an advisory board with Steven Spielberg, J.J. Abrams, and Tyler Perry, among others. It teamed with T-Mobile and Chase Pay offering special ticketing offers, making purchasing tickets faster and more social.

Atom also partnered with studios to better connect them with moviegoers using proprietary data and targeting capabilities on Atom and across the web.

Exhibitor partners include AMC Theaters, Regal Cinemas, Southern Theatres, Showcase Cinemas, B&B Theatres and online movie database, IMDb.

“We’re pleased to participate in this latest round of financing for Atom Tickets, which has demonstrated enormous traction with exhibition partners, studios, and moviegoers during the past year,” Michael Burns, vice chairman at Lionsgate, said in a statement.

MoviePass Seeks to Improve Customer Relations

MoviePass has a customer relations problem.

The subscription ticket service March 5 announced it inked a partnership with TaskUs to improve relations with subscribers. It also hired former Jake Petersen, former senior manager of client services at TaskUs, as the company’s VP of customer experience.

Since cutting the monthly sub price six months ago to $9.95, MoviePass has generated more than 2 million members – with a goal of 5 million by yearend.

At the same time, the New York-based company has endured myriad complaints from subs unable to get membership cards and/or being denied access to screening in select markets, among other complaints.

“We want to ensure that all MoviePass subscribers feel that they are being heard and cared for,” CEO Mitch Lowe said in a statement.

Lowe, who has been making the media rounds promoting the service, reiterated MoviePass has been overwhelmed by consumer interest in seeing a theatrical screening daily for a month for less than the cost of standard ticket in a major market.

TaskUs, which as worked with startups such as Tinder, Periscope, Hotel Tonight and Hootsuite, is tasked with providing consultative solutions and scaled support systems to improve MoviePass’ bottom line.

Indeed, the service pays theater operators full value of every ticket acquired by subscribers – an untenable business model without revenue sharing agreements with theaters or millions of infrequent movie-going subs.

At TaskUs, Petersen was responsible for building and running customer experience operations for a number of hyper-growth companies. Prior to TaskUs, Petersen served as the head of professional support and acquisition for Houzz, where he helped grow the service team to over 60 members, while the company grew from 5 to 40 million users.

“We have a massive opportunity here to create something special within the entertainment industry,” said Petersen.

MoviePass to Invest in as Many as a Dozen Films a Year, CEO Says

Theatrical subscription service MoviePass could invest in as many as a dozen films a year, said CEO Mitch Lowe at a presentation March 2 during the Entertainment Finance Forum presented by Winston Baker in Hollywood.

“We’re going to be selective, but it could be a dozen films a year,” he said. “It could be more. When we find a film that we think we could have a big positive type of impact on, we will come up to the table.”

MoviePass has an interest in film financing because its audience is looking for a wider range of movies.

“The increase in film-going from our subscribers is mostly to sub-$50 million box office titles, and when we went to Sundance in January, we saw a couple of articles that Netflix and Amazon were going to reduce their purchasing and acquisition of independent movies,” Lowe said. “And we wanted to show our support for the independent film community, so we put together a fund that would co-invest with distributors.”

The company bought American Animals alongside The Orchard, he noted.

“We have a couple of other deals that we’ll announce pretty soon, but the whole idea is to support the independent filmmakers,” he said.

Lowe said investment in films early on pays dividends later in the distribution cycle.

“As we market films, we see we enhance the value dramatically and the distributor ends up making so much more downstream, whether it’s licensing or international rights, even DVD sales,” he said. “So we thought one reason to do this is we could earn more money downstream.”

MoviePass is also looking to organize events with subscribers and filmmakers and special screenings for subscribers.

CEO Mitch Lowe Says MoviePass Will Reach 5 Million Subs by End of Year

Editor’s Note: Because of the wide pickup of this article’s section on MoviePass data collection, I have expanded the quote from Mitch Lowe: “We get an enormous amount of information. Since we mail you the card, we know your home address, of course, we know the makeup of that household, the kids, the age groups, the income. It’s all based on where you live. It’s not that we ask that. You can extrapolate that. Then because you are being tracked in your GPS by the phone, our patent basically turns on and off our payment system by hooking that card to the device ID on your phone, so we watch how you drive from home to the movies. We watch where you go afterwards, and so we know the movies you watch. We know all about you. We don’t sell that data. What we do is we use that data to market film.”


Subscription theatrical movie service MoviePass expects to reach 5 million paid subscribers and account for roughly 20% of movie ticket purchases by the end of the year, said CEO Mitch Lowe at a presentation March 2 during the Entertainment Finance Forum presented by Winston Baker in Hollywood.

The service currently has more than 2 million subscribers and accounts for 6% of ticket purchases, Lowe said.

The $9.95 a month service (less for a year subscription) allows subscribers to attend one screening per day at participating theaters. The service is growing the theatrical audience, Lowe said, and more frequent attendance is boosting films that typically make under $50 million at the box office, which have been increasingly pushed out by sequels and franchises released by the studios. It’s also bringing in audiences that had eschewed theaters.

“Our goal is to reenergize moviegoing to the movie theater,” he said, noting that “over 50% of our subscribers are millennials, the people who are abandoning theater the most.”

The service pays theaters the price of each ticket and is looking for discounts and revenue sharing from theaters in exchange for the audience boost. Lowe said he’s just looking for the same kind of discount a retailer such as Costco gets for purchasing a big block of tickets.

Not all theaters have been happy with that plan, notably goliath AMC. Lowe counters that the increased traffic is helping theater chains such as AMC sell more high-priced concessions and that the chain should let MoviePass share in that windfall.

“I think eventually they’ll come around,” Lowe said, though he said there was no “active dialog.”

Another plan to boost MoviePass’s bottom line is to glean income from all of the data the service collects from subscribers.

“We know all about you,” he said at the keynote, appropriately titled “Data is the New Oil: How Will MoviePass Monetize It?”

The data collection information elicited some nervous laughs from the industry crowd, many of whom raised their hands to show they were MoviePass subscribers.

“We get an enormous amount of information,” he said, noting the company knows subscribers’ addresses and can glean demographic information based on where they live. The company also can track subs via the app and a phone GPS.

“We watch how you drive from home to the movies,” he said. “We watch where you go afterwards.”

That sort of data fits into a long-term revenue plan.

“Our bigger vision is to build a night at the movies,” he said, whereby MoviePass would direct subscribers to places to have dinner before or after a screening, for instance, getting a cut from vendors.

As a former executive at entertainment industry disruptors Netflix and Redbox, Lowe said theaters are ripe for change.

“Online, at home, all the other forms of entertainment had all this innovation,” he said. “The theater hasn’t innovated — at least in the business model.”

The key is alleviating consumer anxiety around purchases, he said.

“In 1999 at Netflix when we came up with the disc by mail, all-you-can-eat program we eliminated late fees that Blockbuster had built their business on, and removing that anxiety got people to consume documentaries and foreign films that they never would have rented from Blockbuster,” he said. “And that’s what we’re doing [at MoviePass]. We’re kind of providing movie insurance.”

As a disruptor veteran, he’s also faced doubt about low pricing and seen success despite the initial criticism.

“[MoviePass’s $9.95 a month] may seem like it’s a deal too good to be true,” he said. “That’s what they said about us at Netflix. That’s what they said about us at Redbox.”

He added, “We’ve essentially just copied the Netflix model but in the theatrical window.”

Lowe’s experience at Netflix also leads him to be optimistic about subscriber expansion at MoviePass.

“We went public with Netflix in 2002, and at the end of the year, we all made bets on how big we could get, so just to show you how bad I am at this — I was near the top by the way— mine was 1.7 million subscribers, and I think the highest was 2 million at the time,” he recalled. “Of course, it’s 105 million now, so I do believe 20 million subscribers for MoviePass is definitely doable over a four year period.”

MoviePass to Sponsor Miami Film Festival

Theater subscription service MoviePass, a majority-owned subsidiary of Helios and Matheson Analytics, announced it will be a lead sponsor for the Miami Dade College’s Miami Film Festival.

In addition, MoviePass will offer subscribers a chance to win tickets to exclusive Miami Film Festival events.

MoviePass’ sponsorship donation is part of the company’s ongoing support for independent filmmakers and artists, according to a company release.

The Miami Film Festival is a charitable event held for 10 days each with a mission of bridging cultural understanding and encouraging artistic development by provoking thought through film.

“Miami Film Festival and MoviePass share a common value for the traditional theatrical experience of cinema,” said Jaie Laplante, executive director and director of programming for Miami Dade College’s Miami Film Festival, in a statement. “As cinema moves forward, we are thrilled to partner with MoviePass in their tipping point year and look forward to the energy of new ideas.”

“For MoviePass, it seemed like a natural partnership,” said Mitch Lowe, CEO of MoviePass, in a statement. “We brought our subscription price down to make movies more accessible for movie-lovers. We want people to enjoy films that are off the beaten path, films that they may never have been exposed to if they had to pay the exorbitant ticket prices many theaters charge. Miami has a vibrant film community, and the world-class artists represented at the Miami Film Festival deserve to have their movies seen on the big screen just as much as any blockbuster.”

“Miami has a particular significance to us, since we have offices here and are very much invested in the community,” said Ted Farnsworth, CEO of HMNY and a Miami resident, in a statement. “Our participation in this amazing film festival is to further our commitment to the importance of independent films and to do our part in making such an exciting film community successful.”

MoviePass has more than 2 million subscribers.

Fandor Movie Streaming Service Names New Executive Positions

Movie subscription streaming service Fandor has upped Felice Oper to the chief operating officer position. Oper, who previously served as general counsel and chief distribution officer, will continue as general counsel.

As COO, Oper assumes oversight of the programming and marketing groups, as well as the product and engineering teams.

Separately, Fandor named TS Ramakrishnan to the chief product engineering officer position. He previously headed engineering for Yahoo! Messenger and mobile, and was VP of product engineering at Facebook.

Under Oper’s leadership, Fandor’s subscription base has grown more than 10 times, underscored by OTT partnerships with Amazon Channels, Sling TV, CenturyLink Stream and YouTube Red.

She engineered alliances with MoviePass and Costco, launching the sale of the “Movie Lover’s Package” both on and Fandor launches on Vizio TVs this spring.

“Felice has proven she is committed to helping Fandor reach new heights in the OTT space,” CEO Larry Aidem said in a statement. “Her exemplary knowledge and dedication … continue to support the growth and development of partnerships that makes movie selections more accessible to our customers.”

Aidem said Ramakrishna would help expand movie and editorial content to subs, which in turn affords Fandor the opportunity to grow the brand.

“[TS’] breadth of experience in Silicon Valley and the digital space will enable Fandor to further develop the company’s user experience, enabling us to further grow the Fandor community,” added Oper.


Is Content King — or Is Data?

You may think Netflix’s business is offering subscription video streaming of increasingly original content and MoviePass’ offering subscription access to theatrical content, but there’s a hidden asset that buttresses both — consumer data.

Speakers at the February Digital Entertainment World conference in Marina Del Rey, Calif., pointed out the importance of data in entertainment disruption.

“MoviePass is a new type of business model,” said John Penney, EVP of consumer business development and strategic partnerships at 20th Century Fox. “Data is really the core of the business.”

Another Fox exec at the same event, on the panel “Does Hollywood Need a Blockchain?,” noted the importance of data in the entertainment industry. With their exclusive data, digital retailers have become “gatekeepers of what consumers are interested in,” said Ron Wheeler, SVP of content protection and technology strategy, adding a “potential effect of blockchain is the decentralization of access to data.”

You may think blockchain is only about cryptocurrency, but it’s also about precise data tracking, just the kind of thing digital companies such as MoviePass and Netflix are now keeping to themselves.

Data on consumer preferences can affect marketing spend — and the very content that gets produced. Currently, studios must depend on tracking from retailers, theater chains and other outside sources. Meanwhile, Netflix and MoviePass have data that tells them exactly what entertainment viewers are consuming. In the case of MoviePass, that data tracking could extend to where they ate dinner before the movie and whether they used Uber to get there.

It may be time for Hollywood to pay as much attention to data as it does to development.

Helios & Matheson Ups MoviePass Stake

Technology investor Helios & Matheson Analytics (HMNY) Feb. 16 announced it has upped its ownership stake in MoviePass to 78% from more than 53%.

MoviePass offers subscribers daily access to one theatrical screening for a $9.95 monthly fee. The New York-based service has more than 2 million subs.

HMNY acquired the additional stake following a $45.5 million cash advance to MoviePass from Dec. 19 through Feb. 15, according to a regulatory filing.

“We could not be more thrilled to hold a bigger stake in MoviePass, as the [theatrical ticket subscription service] phenomenon has become a major disruption to the entertainment industry,” CEO Ted Farnsworth said in a statement. “The partnership continues to be a great benefit to both MoviePass and Helios and Matheson shareholders.”

The stake follows a $105 million public offering from a shelf offer of more than $400 million.