MoviePass Looking to Raise Prices, Restore Consumer/Investor Trust

MoviePass, the beleaguered theatrical ticket subscription service, is set to roll out new monthly pricing plans it hopes will financially stabilize the service and restore investor confidence in corporate parent Helios and Matheson Analytics, among other goals.

In an interview with Variety, MoviePass CEO Mitch Lowe said the new tiered pricing plans – ranging from the existing $9.95 to $24.95 – would be dependent on where subscribers lived.

As a result, consumers living in rural areas would likely see no change to the $9.95 fee (dubbed “select”) affording access to three movies per month at select times, while moviegoers in major markets such as Los Angeles and New York would pay $14.95.

A $19.95 “red carpet” option – which mirrors the fee of a competing service from AMC Theatres – enables rural subscribers access to three screenings at any time in any format (Imax, 3D, 2D). The option costs $24.95 in major cities.

“We have a lot to prove to all our constituents,” said Lowe. “We don’t just have to prove ourselves to our members, we also have to prove ourselves to the investment community, our employees, and our partners.”

Indeed, the service’s well-chronicled missteps largely revolved around an unsustainable business model that paid exhibitors full price for every ticket consumed by subscribers paying less than $10 per month for daily access to a theatrical screening.

With MoviePass unable to convince exhibitors to share in the financial risk in return for enhanced foot traffic and sharing user data – the latter triggering data breach concerns – the service began to hemorrhage money and alienate consumers and investors.

In HMNY’s most-recent fiscal report, the company reported a loss of $137 million and just $6.2 million in cash available. The parent’s stock is worth pennies and in risk of being delisted by Nasdaq – despite a reverse-stock split last summer. A planned second reverse-stock split was abandoned after failing to generate enough shareholder approval.

“Expectations weren’t met,” said Rodes Ponzer, head of marketing. “The creative memes and the consumer vitriol, we understand it. We told customers [theatrical access] was un-limited and we didn’t meet their expectations. Now we’re going to set their expectations properly.”

 

 

 

 

MoviePass Promotes Itum to EVP

MoviePass, the movie theater subscription service and majority-owned subsidiary of Helios and Matheson Analytics, has appointed Khalid Itum to EVP.

Previously VP of business development, Itum will continue to report to CEO Mitch Lowe. Itum will manage day-to-day operations at MoviePass, working closely with both Lowe and HMNY CEO Ted Farnsworth to spearhead company development, and drive its exhibition and distribution strategies forward, according to a MoviePass press release. Itum will also be responsible for creating its strategic plan and ensuring its implementation.

“Khalid is a unique talent with an amazing vision, who has been an integral part of MoviePass since 2014,” said Lowe in a statement. “Before coming on in a full-time capacity in 2017 to lead our studio affairs and distributor partnerships, he played a significant role as an advisor. As we continue to spur innovation across the industry, he not only strengthens our sales and operations efforts across the organization, but he deepens our relationships within the industry ecosystem.”

As VP, Itum had been responsible for driving revenue through multiple studio and independent distributor partnerships and various brand and content deals. He played a crucial role in growing MoviePass’ Los Angeles office and led the strategic formation of MoviePass Ventures and its first acquisition of American Animals — alongside The Orchard — at the 2017 Sundance Film Festival, according to the release. He also spearheaded the acquisition of Moviefone from Oath earlier this year.

“Khalid has a proven track record and I believe he will serve our financial goals and increase our overall operating performance,” said Ted Farnsworth, CEO of Helios and Matheson, in a statement. “Khalid brings a remarkable enthusiasm and passion to the job each day and truly shares in the overall vision of MoviePass.”

“I’m eager to continue building MoviePass and am proud of how far we’ve come,” said Itum in a statement. “The road hasn’t been easy — and the hyper growth has been challenging. However, we’ve taken a hard look over the past few weeks and months at what needs to happen in order to not just preserve what we’ve built, but to use it as a foundation upon which to build. Because of this, I know we’ll emerge a better partner to the theaters (big and small), major studios and independent distributors with whom we have the privilege of working to collectively best serve the interests of the American consumer. You may notice we’ve been out of the news for some time, and that’s been by design. At MoviePass, we’ve recently prioritized building toward a vision that aligns our success with greater consumption of entertainment. You’ll soon be able to judge for yourselves, and I believe that the best marketing we can do, today and always, is to enhance our product and treat our subscriber as a member of something special: because that’s what MoviePass is to a great number of Americans already. It’s on us to regain their trust. I believe the future is bright for our company, and I couldn’t do it without my team which has been giving its 200% dedication and effort to transform the offering and platform into its full potential. I look forward to announcing some powerful additions to our management team to join with us in charging forward.”

MoviePass Parent Narrows Q3 Fiscal Loss; Touts Subscriber Usage Decline

MoviePass parent Helios and Matheson Analytics Nov. 15 disclosed that subscribers of its fiscally-challenged theatrical ticket service consumed 0.77 movies per month in the third quarter (ended Sept. 30) compared to 2.2 movies in April.

The 65% usage drop is noteworthy in that it underscores management’s efforts to reduce monthly overhead costs related to reimbursing exhibitors full ticket price every subscriber screening.

Key to MoviePass’ survival is reducing the number of subscribers screenings — not subscribers. HMNY didn’t disclose MoviePass subscriber numbers, which topped 3 million before the service began implementing significant restrictions to the $9.95 monthly service.

“During this transitional period for Helios and MoviePass, we have been focused on reducing our burn rate and striving to improve our business model and we are very encouraged by our Q3 financial results,” Ted Farnsworth, CEO of Helios, said in a statement.

HMNY, which just canceled a special shareholder meeting after failing to secure enough investor interest in a second reverse-stock split, is desperately trying to rewrite the narrative on a money-hemorrhaging ticket subscription service that posted a loss of $105 million through June 30.

Indeed, the company posted a loss of $28.5 million, which it attributed to a $75.5 million (70.6%) gross margin improvement. Revenue increased $7.2 million, or 9.8%, to $80.5 million compared to the prior-year quarter.

MoviePass Parent Cancels Special Shareholder Meeting Seeking Second Reverse Stock Split

Helios and Matheson Analytics shareholders have been to this rodeo before.

The corporate parent to fiscally challenged ticket subscription service MoviePass Nov. 13 disclosed that a planned special shareholder meeting regarding a proposed second reverse-stock split has been canceled due to a lack of requisite stockholder votes.

The meeting, previously scheduled for Oct. 18 and then delayed to Nov. 14, had sought to gain approval for 1-for-500 shares reverse-stock split. With shares currently hovering around 1.7 cents per share – 98.3 cents below the mandated $1 per share Nasdaq minimum – HMNY sought to artificially prop up the stock to meet compliance.

Shareholders were perhaps skeptical considering less than six months ago HMNY received approval for a 1-for-250 shares reverse-stock split.

While the split briefly resulted in stock reaching $22.50 per share, in less than five days the stock had again fallen below the $1 minimum – and continued to fall.

Nasdaq has stipulated HMNY has until Dec. 18 to meet compliance. HMNY, in a regulatory filing, said it hopes Nasdaq affords it a second 180-calendar day period to regain compliance.

To qualify for the extension, HMNY would have to demonstrate a realistic path toward elevating the stock price – a strategy it (incredulously) says would likely depend on another reverse-stock split.

The other strategy apparently involves appeals and denial.

“If the company does not regain compliance and is either not eligible for an additional compliance period … the company may appeal the delisting,” it wrote.

Indeed, HMNY would remain listed pending Nasdaq appeals panel’s decision.

 

National Amusements Subsidiary Launches Movie Ticket Subscription Service

Showcase Cinemas, a small subsidiary of Viacom/CBS parent National Amusements, Nov. 12 announced the launch of “Showcase Subscribe,” the company’s first ticket subscription service.

Starting at $16.95 for three movies a month, the service allows customers to reserve tickets in advance via the app. Subscribers can purchase tickets from either the 2D or “premier plan,” which includes 3D, X and Imax formats. Additionally, there are no “blackout dates” and subs can use their Showcase Starpass membership number to gain loyalty points on Showcase Subscribe plan purchases.

“Launching just in time for the holiday movie-going season, Showcase Subscribe membership is a great way to give yourself the gift of going to the movies,” Mark Malinowski, VP of marketing for Showcase Cinemas, said in a statement.

Showcase Cinemas operates more than 932 movie screens in the U.S., U.K., Argentina and Brazil under the Showcase, Cinema de Lux, SuperLux and UCI brands.

With just 28 screens domestically, Showcase Subscribe may not be a significant competitor to AMC Stubs A-List, the upstart subscription service launched by the nation’s largest exhibitor less than five months ago seeking to supplant fiscally-challenged MoviePass.

Regardless, costs associated to A-List contributed to AMC posting a net loss of $100.4 million during its most-recent fiscal period.

2D Plan Showcase Subscribe details and pricing (Three Movies Per Month):

  • Individual: $16.95/monthly
  • Groups
    • Two: $32.95/monthly
    • Three: $47.95/monthly
    • Four: $62.95/monthly
    • Five: $76.95/monthly
    • Six: $89.95/monthly

 

Premier details and pricing (Three Movies Per Month):

  • Individual: $19.95/monthly
  • Groups
    • Two: $38.95/monthly
    • Three: $56.95/monthly
    • Four: $73.95/monthly
    • Five: $89.95/monthly
    • Six: $105.95/monthly

All plans require a minimum three-month purchase. Showcase SuperLux, LuxLevels and Showcase MX4D are not part of Showcase Subscribe.

AMC Theatres CEO Says A-List Subscription Ticket Service Will be Profitable a Year Early

Since launching Stubs A-List theatrical ticket subscription service less than five months ago as competition to MoviePass, AMC Theatres has generated 500,000 subs to the $19.95 monthly service.

As a result, CEO Adam Aron now says the service will be profitable in 2019 – a year ahead of projections.

Speaking Nov. 8 on the fiscal call, Aron said the service is generating $120 million in annual revenue that didn’t exist six months ago – excluding concessions. In addition, user data is tracking downward – with average subscriber screenings per month dropping from 3.4 to less than three.

The executive believes the ratio will drop to 2.5 screenings, which translates favorably on the bottom line. As subscribers attend fewer screenings, margins inch toward profitability.

“If this trend continues as other proprietary data in our possession often suggests that it will, we now believe … the program could be [fiscally] accretive,” Aron said.

“If we didn’t have A-List, some of those [subs] wouldn’t be buying tickets at all,” he said. “Some of those [subs] would still be buying tickets at AMC. But they’d be coming less frequently.”

Indeed, AMC plans to raise A-List pricing by 20% in California, New York, New Jersey, Connecticut, Massachusetts; and up 10% in other big markets.

Aron said feedback on social media to the planned hikes has been positive.

“You should read the Reddit message boards about A-List and our competitors. They’re fans of A-List because it offers them so much value,” he said.

Meanwhile, total AMC domestic Q3 revenue grew 5.9% to $895.6 million. The nation’s largest theatrical chain outperformed the industry, growing domestic attendance per screen by 9.1%, which was more than 4% better than the industry. The company, however, reported a net loss of $100.4 million, up 135% from a loss of $42.7 million during the previous-year period.

Wall Street wasn’t impressed, sending shares down 14% on Nov. 9.

MoviePass Ventures Touts BIFA Nominations for ‘American Animals’

MoviePass Ventures announced its first entry into film distribution, American Animals, has received several nominations for British Independent Film Awards.

The film is being distributed in association with The Orchard.

Nods include Best Independent Film; Best Director, Best Screenplay and Best Debut Screenwriter (Bart Layton); Best Supporting Actor for both Barry Keoghan and Evan Peters; Best Casting; Best Cinematography; and Best Editing.

“We are floored,” said Ted Farnsworth, chairman of MoviePass Ventures. “To reach the moon on our maiden voyage is absolutely phenomenal. We knew we had something special at the Sundance Film Festival when we got on board and these nominations more than confirm that we were right.”

MoviePass Ventures, a wholly-owned subsidiary of HMNY announced at the 2018 Sundance Film Festival, collaborates with film distributors and creatives to co-acquire film rights.

American Animals follows four friends who live an ordinary existence in Kentucky. After a visit to Transylvania University, one of them comes up with the idea to steal the rarest and most valuable books from the school’s library. In planning the art heist, the men question whether their attempts to inject excitement and purpose into their lives are simply misguided attempts at achieving the American dream.

AMC Stubs A-List Subscription Service Tops 500,000 Members; Monthly Fee Going Up

AMC Theatres Nov. 5 announced that its $19.95 ticket subscription service – AMC Stubs A-List – would soon cross more than 500,000 members, eclipsing the company’s membership expectations for the end of the first full year in just 4 1/2 months.

The overall AMC Stubs program has surpassed 17 million-member households, up from about 2.5 million member households only 2 1/2 years ago.

Beginning immediately, households can use a credit card as the payment method for separate, individual A-List accounts. AMC also extended the minimum age for AMC Stubs A-List from 18 years old currently to 16 years old with a valid photo ID.

AMC plans to roll out reserved seating in all AMC-branded theaters and AMC Dine-In theatres by next June. This increase in reserved seating locations will not apply to AMC Classic branded theaters.

AMC-branded theaters in the metropolitan areas of Boston, Denver, Houston, Los Angeles, New York, San Diego, and San Francisco will have access to AMC “mobile ordering,” which lets users purchase food and drinks online at the same time as they reserve their tickets.

AMC said it would increase A-List pricing in states where the program is most popular. Beginning Jan. 9, 2019, the monthly price will increase to $21.95 plus tax in Colorado, Delaware, Florida, Georgia, Illinois, Maryland, Minnesota, Pennsylvania, Virginia, Washington state and The District of Columbia. The price increases to $23.95 plus tax in California, Connecticut, Massachusetts, New Jersey and New York.

All current A-List subs as well as subs who sign up before Jan. 9, 2019, will continue at the $19.95 price guarantee for 12 months from the start of their membership.

“Increasing enrollments to 17 million AMC Stubs member households over the past 2 1/2 years, or achieving initial enrollments of a half million members in AMC Stubs A-List in just 4 1/2 months, are astounding numbers,” CEO Adam Aron said in a statement. “Our decision to keep the AMC Stubs A-List monthly price unchanged in 35 states, along with only a modest price adjustment in some key markets, will keep us in that sweet spot of successfully balancing profits and popularity

MoviePass Films Invests in Sports-Themed Documentary

MoviePass Films, the theatrical ticket subscription service’s content acquisition unit, Nov. 1 announced an agreement with Art of Sport, the newly-formed, sports-centric distribution entity behind upcoming feature-length documentary, In Search of Greatness.

MoviePass Films, which is owned by MoviePass parent Helios and Matheson Analytics, has come on as an investor and strategic marketing partner ahead of the film’s early-November theatrical release.

In Search Of Greatness, directed by documentarian Gabe Polsky, best known for Red Army, which debuted in Cannes in 2014, and his work on Nat Geo’s Emmy-award-winning TV show, “Genius,” examines the importance of creativity in determining athletic ability, in addition to analyzing the roles nature and nurture play in the development of young athletes.

The film, which includes interviews with hockey legend Wayne Gretzky, superstar wide receiver Jerry Rice, and soccer icon Pele, opens in 11 major U.S. markets on Nov. 2, and expands to theaters across North America by mid-month.

“We are pleased to be able to continue supporting independent creators and helping them bring their artistic visions to life on the big screen,” MoviePass Films chairman Ted Farnsworth and co-CEO Randall Emmett, said in a statement.

The investment follows a busy month of deal-making for the MoviePass Films. In September, it partnered with indie distributor Neon to co-release Reinaldo Marcus Green’s Sundance award-winner Monsters and Men (currently in theaters), and is preparing to co-release the second film in that partnership, Ali Abassi’s Cannes award-winner Border (which debuts in theaters this week).

MoviePass Films also recently wrapped production on its Bruce Willis-starrer 10 Minutes Gone and green-lit Neil Marshall’s The Reckoning, which starts production in Wales in January. The MoviePass Films team intends to produce 10-12 films annually, in addition to acquiring 8-10 films per year, starting in 2019.

MoviePass Films via MoviePass and Moviefone, will mount a marketing campaign to support the film’s success, while in theaters. In Search of Greatness will be made available to MoviePass subscribers as a “Bonus Movie,” which will not count toward their monthly in-theater movie ticket allotment. MoviePass™ subscribers will also have a chance to attend the films’ red-carpet premieres and receive other special perks throughout the duration of the partnership.

 

 

Survey: Consumers Willing to Pay $22 Monthly to See Three Theatrical Movies Monthly

As theatrical ticket subscription pioneer MoviePass struggles to remain in business, a new survey reveals consumers are willing to pay more than twice the $9.95 fee MoviePass currently charges subscribers.

The survey conducted Oct. 11-14 among 2,201 adults from Morning Consult and commissioned by The Hollywood Reporter, found respondents would pay upwards of $22 monthly to watch three theatrical screenings monthly.

Respondents said they would also pay $25 to see three movies per week, and $33 for unlimited screenings.

MoviePass set the exhibition industry on its ear last year when it launched service offering subscribers daily access to a theatrical screening for less than $10 per month. With the service paying exhibitors such as AMC Theatres and Regal Cinema face value for each ticket consumed by subscribers, fiscal losses began to spiral out of control.

MoviePass now limits subs to three select screenings per month. Restrictions that resulted in AMC and Cinemark launching competing ticket subscriptions – the former priced at $19.95 enabling subs access to three screening weekly in any format, including Imax, Dolby Cinema and RealD 3D.

Three in 10 frequent moviegoers subscribe to AMC Stubs A-List, while 27% subscribe to MoviePass.

Notably, the survey revealed that just 6% of respondents are “very likely” to purchase a subscription service, while 23% could go either way. That left 71% of respondents who said they were either not very likely (32%) to purchase a subscription or had no interest (29%) in buying one. Another 10% didn’t know or had no opinion.

Millennials are the most likely to purchase a ticket subscription.

According to the survey, perks that would incentivize consumers to use a subscription service include: unused tickets rolling over to the next month (22%); ability to choose from a variety of plans/theaters (19%); the number of movies included (15%); and the ability to use subscription tickets to bring friends (25%).