What would be your initial reaction if I told you that you could watch any 2D movie you wanted for only $10 a month? Doesn’t that sounds too good to be true? In fact, it’s quite possible! You may have already heard, but Moviepass, a company that has been in business for a few years already, has been upending the movie industry since they recently and drastically lowered their monthly subscription costs following a majority stake purchase from Helios and Matheson Analytics, hereafter abbreviated as HMNY. The way this service works is through a debit card and app combo:
- Sign up for Moviepass
- Receive your Moviepass-branded debit card
- Download the Moviepass app
- Check in to your theatre when you’re within 100m of it
- Use your Moviepass card to pay for your ticket when you’re at the register/kiosk
I’ve used this service to see 16 movies since September, making it one the best value purchases I’ve ever made. Each time you check in, your debit card is automatically loaded with the price of a 2D ticket at the theatre you’ve selected. You then get the ticket for free, and HMNY foots the bill. How is this possible, you may ask? The game plan of HMNY is to draw out enough previously-uninterested moviegoers to warrant a stake in movie theatre profits. In addition, the company expects to sell your movie watching data, and offer you deals at nearby stores and restaurants in the future.
Although I’m cautiously optimistic about the long-term viability of this company, I think it has, at the very least, started a discussion about whether or not the movie theatre industry should fall in line with more modern offerings by providing a subscription solution to better cater to the latest generation of consumers who have all grown accustomed to monthly pricing vs. a-la-carte ones. We no longer think of paying for a individual song or movie when we stream one, we have monthly/yearly gym memberships, and we have already become habituated with paying for cars and houses with monthly payments. Why not pay monthly rates to theatres to watch as many movies as we would like?
AMC has been a vocal critic of the service, claiming it devalues the moviegoing experience by training consumers to value the price of admission at a rate much lower than what is currently offered by chains. I believe this is a false statement in that Moviepass converts non-attendees to regular theatre-goers again. I’ve heard countless times during my highschool and college years that going to the theatre is either too expensive or not worth the showings currently playing. With Moviepass, these statements no longer apply. By eliminating the risk of attending a potentially-bad showing, more people are headed to the theatres than ever before, increasing ticket sales and concession revenues for theatres by a yet-undisclosed amount. For those in the theatre business, it seems their argument is more a result of stubbornness towards change than one of substantive evidence. I acknowledge the risk of training consumers to become accustomed to a particular price point. But what if this service is also drawing out attendees that would otherwise ignore the theatre completely?
A number of statistics have shown that ticket sales have been declining since the turn of the century. An increasing number of outlets for boredom such as the proliferation of mobile devices and the amount of engagement on the Internet have been effective draws from traditional entertainment such as TV and movies. In light of this phenomenon, it would seem that struggling industries must reinvent themselves by offering new value propositions to combat the tide of new age entertainment they are hemorrhaging business to.
While the movie business can be tricky and filled with fees, legalese, and pricing competition that can easily eat away at theatre profits, I think this is all the more reason for companies such as Moviepass and AMC to team up against mutual threats to survival such as film distribution companies. Without theatres to distribute to, film companies would be forced to either become non-viable or distribute on alternate platforms that would further devalue their products such as Netflix or Amazon Video. By keeping first-releases in theatres first, they stand to gain more than if they were to distribute to consumers directly or through other middlemen. Thus, I believe it would be in the best interests of film distribution companies to thoroughly and candidly examine their business model in order to bargain with chains and middlemen to accommodate monthly pricing options. Moviepass has shown there is a market for monthly movie rates. Now, we only need a response from those higher up on the supply chain.