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.

Data and Analytics Driving MoviePass to be Discussed at Conferences

The data and analytics initiative behind the business model of MoviePass, the movie ticket subscription service headed by former video rental dealer Mitch Lowe,  will be the topic of the first bi-coastal keynote address at the Smart Content Summit West (Feb. 27, Los Angeles) and Smart Content Summit East (March 8, New York).

Lowe, MoviePass’s CEO, and Ted Farnsworth, chairman and CEO of parent company Helios and Matheson Analytics Inc., will both take the stage in Los Angeles with a keynote conversation titled “Innovation Across the Entertainment Industry; the MoviePass Effect.”  This will be followed 10 days later by a solo keynote conversation by Farnsworth at Smart Content Summit East called “Disruption in the Entertainment Industry; Monetizing the MoviePass Effect.”

Helios and Matheson acquired a majority stake in MoviePass last August. MoviePass subsequently announced that it would lower its monthly subscription price to $9.95, for which subscribers are entitled to see up to one movie per day in theaters.  At the time, Farnsworth stated that the service wanted to increase the size of its subscriber base in order to provide viewing data to content creators and advertisers.  Following the subscription price reduction, MoviePass subscribers increased from 400,000 to 1.5 million as of January 2018.

Prior to joining MoviePass, Lowe was President and COO at Redbox. Previously, he was a co-founding senior executive and VP of Business Development and Strategic Alliances at Netflix, a position in which he facilitated many of the early studio negotiations and subscriber acquisition programs. Before that he owned Video Droid, a video rental retailer in the San Francisco Bay Area.

MoviePass Owner Commences $400 Million Stock Sale

Helios and Mathesson Analytics, majority owner of theatrical ticket subscription service MoviePass, Feb. 12 began formally selling $400 million in common stock.

The stock sale was first disclosed in a Jan. 25 regulatory filing.

The New York-based investment company said it would use the funds for myriad purposes, including increasing its stake in MoviePass, funding MoviePass operations and content acquisitions (MoviePass Ventures), pay down debt ($29 million) and pay general corporate and transaction expenses.

MoviePass, which has seen its subscriber base balloon to 2 million monthly members from 30,000 last summer, underscores consumer demand for a $9.95 monthly service that enables users access to one 2D theatrical screening per day.

At the same time, with the service paying exhibitors full price per ticket redeemed, MoviePass is hemorrhaging money on frequent moviegoers.

Eric Wold, media analyst with B. Riley FBR, says that while MoviePass is shaking up the theatrical market, it must diversify revenue streams to survive.

The service just announced it would begin selling subscriptions combined with movie streaming service Fandor beyond the Costco retail chain.

“The question will be whether or not those alternative revenue streams can ramp fast enough to bring MoviePass to break-even/positive cash flow before the company’s sources of external capital dry up,” Wold told


MoviePass Owner Touts Data, Deals

Helios & Matheson Analytics, a majority owner of theatrical subscription service MoviePass, Feb. 12 announced that MoviePass had, in the last several weeks, signed multiple contracts on both per-title and slate-wide bases with several Hollywood studios and independent distributors.

“With the introduction of these new services, MoviePass delivers on revenue beyond its base of more than 2 million subscribers, allowing studios and distributors to more accurately target spending for advertising, reach the right audiences more effectively, and identify the most effective markets for special events,” Helios & Matheson stated in a release.

The relationships with studios and distributors are currently producing revenue in the following areas, the release stated: advertising and consumer turnout, A/B testing of sales of DVDs and streaming with similar content, a suite of services for A/B testing for marketing creative, audience attribution, and exclusive fan-based events.

Additionally, studios utilize MoviePass platform marketing techniques such as email marketing, targeted push notifications, custom premium title placement within the MoviePass application, and other features based on individual MoviePass subscriber movie-going behavior, the release stated.

Exhibitor benefits when partnered with MoviePass include priority theater placement in the MoviePass application, e-Ticketing — no MoviePass card needed — box office purchases, and marketing opportunities within the MoviePass application.

“Partnering with MoviePass allows us to provide a value option to a segment of our customers that doesn’t impact our traditional pricing structure,” said Michael Barstow, director of analytics and business development at Main Street Theatres, an exhibitor with about 50 screens nationwide, in a statement. “We are a small exhibitor circuit and MoviePass is another piece of the puzzle that elevates us above our competitors and helps us to better serve movie-goers. MoviePass is rapidly growing its customer base in our markets and we decided that we wanted to be their theater. Since partnering with MoviePass, we have had multiple customers reach out to us and thank us for being the only e-ticketing partner in their market.”

Bernadette McCabe, SVP of exhibitor relations and business strategy at MoviePass, has been spearheading strategic initiatives to educate exhibitors about the service that MoviePass provides, according to the release.

“We are striving to be good partners to exhibitors and they are starting to see the value in MoviePass,” she said in a statement. “Our MoviePass-specific marketing efforts help drive people to our exhibitor’s partners’ theaters and enhances the movie-going experience for their customers. Every person we drive to a theater allows the exhibitors to take in possible incremental revenue from concession sales and other theater-specific revenue streams, so we continue to benefit the movie-going ecosystem.”

“We are thrilled to see that the studios and exhibitors have embraced MoviePass,” said MoviePass CEO Mitch Lowe, in a statement. “For the first time, studios, distributors and movie theaters have been able to innovate beyond their traditional marketing and advertising tools. They now can move from impression-driven advertising model to a model based solely on conversions. In the old days, the studios would pay advertising dollars without the ability to track results. With the MoviePass platform, the studios pay MoviePass only when the MoviePass subscriber goes to the movie. This is the most targeted and direct advertising that Hollywood has ever had at the studio level.”

“We always knew from day one that MoviePass was about big data and understanding the movie-goer’s habits — and being able to monetize that data,” said Ted Farnsworth, chairman and CEO of Helios and Matheson Analytics, in a statement. “Now, not only has this been verified, but it is quickly becoming a widely accepted way to market and brand new films in Hollywood. We are excited to be a part of a new revolution in this sector.”

In other MoviePass news, the theatrical subscription service announced a new bundle with streaming service Fandor. The annual offer lowers the MoviePass monthly price from $9.95 to $7.95 and is coupled with an annual Fandor subscription. Subscribers who sign up will be billed $115.35 ($7.95 a month plus a $19.95 processing fee) and will receive one full year of MoviePass and one full year of unlimited streaming from Fandor. Fandor streams more than 5,000 movies from around the world from more than 500 genres that include Hollywood classics, undiscovered gems and festival favorites, according to a MoviePass release.

Analyst Calls MoviePass’ $128.7 Million Oscar Box Office Contribution Claim Disingenuous

When upstart MoviePass recently announced it had contributed $128.7 million in box office for select Oscar-nominated films, it appeared to underscore both market demand and importance of a theatrical ticket subscription service.

Upon closer scrutiny, it was reported that the box office for Oscar nods Call Me By Your Name, Lady Bird, Three Billboards Outside Ebbing, Missouri, The Shape of Water, The Post, I, Tonya and The Square had combined ticket sales of $17 million.

MoviePass then clarified the Feb. 7 press release, saying the service accounted for $31.4 million in additional Oscar-nominated film ticket sales, bring the total impact to $48.5 million.

When combined with $110 million tickets bought through the service – MoviePass pays exhibitors for every ticket purchased – since August 2017, and another $80.2 million in tickets by friends of MoviePass subscribers, total contribution reached $128.7 million.

Wedbush Securities media analyst Michael Pachter said the revised $48.5 million tally seems reasonable. The analyst contends MoviePass should only count tickets purchased by subscribers, and perhaps its subscribers’ friends will join as well if compelled to do so.

“The $128.7 million figure seemed impossible,” Pachter wrote in a Feb. 12 note. “It is simply disingenuous.”

The analyst contends MoviePass, which just topped 2 million subs, is trying to secure concession revenue sharing agreements with major chains AMC Theatres, Cinemark and Regal Cinemas, including $3 ticket price cuts.

MoviePass recently blocked access to select high-priced theaters in Manhattan, N.Y. in order to cut down on costs.

Cinemark operates its own subscription service, Movie Club.

“[While] MoviePass is surely saving significantly by blocking attendance at AMC’s 10 highest-cost national locations, it’s just a matter of time before AMC and Regal launch their own subscription services,” Pachter wrote.


MoviePass Tops 2 Million Subscribers

Helios and Matheson, corporate owner of theatrical ticket subscription service, MoviePass, Feb. 8 announced the service now has more than 2 million subscribers – less than two months after surpassing 1 million subs.

The New York-based $9.95 monthly service enabling subs access to one theatrical screening per day, is on a full-court offensive to gain traction among moviegoers.

In addition to reaching critical mass, MoviePass aims to convince theater operators into entering revenue-sharing agreements, among other business deals, arguing its service is driving cineplex foot traffic.

“We’re giving people a reason to go back to the movie theaters and they’re going in droves. With awards season here, we hope we can make Hollywood and exhibitors very happy by filling seats with eager audiences,” MoviePass CEO Mitch Lowe said in a statement. “Based on the dramatic increase in the number of MoviePass subscribers over such a short period of time, we believe MoviePass will continue to grow its subscriber base significantly.”

With the service obligated to pay major exhibitors full price for any tickets redeemed, Wedbush Securities analyst Michael Pachter contends MoviePass – absent any discounts – has to reach 2 million subs to break even.



MoviePass: $129 Million Generated for Oscar-Nominated Films

Helios and Matheson Analytics – corporate parent of MoviePass – Feb. 6 announced the subscription theatrical ticket service has generated $128.7 million for select Oscar-nominated since last November. In addition, it claims MoviePass contributed 5.7% to the total nationwide box office.

In addition to offering subscribers access to one theatrical screening daily for $9.95 monthly fee, MoviePass is banking its survival — and offsetting theatrical disruptor mantra — on moviegoer data. Information, it can market and sell.

The service said it contributed significantly to the nominees, keeping attendance up past opening week. It said the percentage of domestic revenue generated for Best Picture nominees, included Call Me By Your Name (8.79%), Lady Bird (6.18%), Three Billboards Outside Ebbing, Missouri (6.89%), The Shape of Water (7.87%), and The Post (5.57%).

MoviePass also contributed 11.48% for I, Tonya, and 7.57% for The Square.

“MoviePass is actively driving movie-goers to the theater at a critical moment in the year,” Mitch Lowe, CEO of MoviePass, said in a statement. “At a time with ‘For Your Consideration’ billboards up all over Tinseltown, we are promoting these pictures to our MoviePass subscribers. I believe more people are connected with these films now and MoviePass has created more exposure for these nominees and the Oscars.”

Ted Farnsworth, CEO of Helios and Matheson Analytics, which acquired a majority stake in MoviePass in 2017, contends the service contributed 4.6%, 5.6%, and 5.7%, respectively, over the past three weeks to total nationwide box office.

“I believe we can serve as a catalyst for success in the entire movie industry,” said Farnsworth.


Netflix Interested in MoviePass?

NEWS ANALYSIS: Wall Street loves scuttlebutt. Rumors and speculation make stocks do crazy things.

On the morning of Jan. 30, shares of Helios and Matheson Analytics, majority owner of theatrical ticket subscription service MoviePass, edged up slightly (2%, the day after rising 9%) on talk Netflix is an interested suitor.

MoviePass has been in the news lately as a significant disruptor of the theatrical ecosystem. The service gives members access to one screening daily for a $9.95 monthly fee. In less than six months more than 1.5 million people have signed up.

What piques Wall Street attention about MoviePass – besides the disruptor subscription business model – is the fact that CEO Mitch Lowe once was a senior executive at Netflix and is often credited with co-launching the streaming video behemoth. Lowe also once headed Redbox.

Of course there is no official word from Netflix, considering many observers characterize the “news” as crazy.

MoviePass pays theater operators full value for tickets used by subscribers. The service is now trying to extract revenue-share agreements with major chains as it has with about 1,000 independent screens.

The company says it has driven significant attendance to theaters. Market observers contend MoviePass accounts for about 4% of foot traffic at AMC Theatres, the nation’s largest chain.

Indeed, Netflix has a tortured history with theaters. It doesn’t much care for them. The service contends the 90-day theatrical window is archaic in today’s tech-savvy market with ubiquitous access.

Netflix, which is planning to bow upwards of 80 feature movies through next year, makes original movies – such as the big-budget futuristic cop drama Bright – available globally for streaming concurrent with theatrical.

As a result, theaters passed on the Will Smith- Joel Edgerton buddy film that reportedly generated 11 million streamings in the first 72 hours upon launch. Ditto for Okja, the $50 million Korean sci-fi drama and Cannes Film Festival nominee.

Regardless, Wedbush Securities Michael Pachter says suggestion of Netflix’s interest in MoviePass is as much amusing as baffling.

“That makes no sense to me whatsoever,” Pachter said. “Remember, Mitch Lowe was a co-founder of Netflix [with Reed Hastings and Marc Randolph], and presumably, they’re no longer best friends.”

MoviePass Acquires Indie Crime Drama ‘American Animals’

Subscription theatrical ticket service MoviePass acquired the rights (with The Orchard) to art crime drama, American Animals, for $3 million at the Sundance Film Festival.

The acquisition was done through MoviePass Ventures, the upstart subsidiary launched at Sundance to co-acquire movies and distribute through multiple channels, including packaged media, on-demand and streaming.

“I made this film to be watched in theaters and the fact that this incredibly impressive partnership and this innovative deal put so much emphasis on that is hugely exciting,” Animals director Bart Layton (“The Imposter”) told

With more than 1.5 million subscribers, MoviePass continues on an aggressive push to disrupt the theatrical ticketing ecosystem with a subscription-based business model. Media reports suggest the service could reach 3 million subs by April.

MoviePass just issued a regulatory offer for $400 million in future funding, and reportedly dropped select AMC Theatres in an effort to obtain better fiscal terms, including revenue sharing.

Wedbush Securities analyst Michael Pachter believes the service – which pays exhibitors full price for tickets purchased – needs at least 2 million (infrequent moviegoers) subs to break even.

Pachter says MoviePass has rev-share agreements with most (about 1,000) indie theaters – a situation it would like to replicate with national chains.

That could be wishful thinking with AMC, whose CEO Adam Aron refuses to consider the concept.

“AMC has absolutely no intention, I repeat no intention, of sharing any – I repeat, any, of our admissions revenue or our concessions revenue with MoviePass,” Aron said on the most-recent fiscal call.