If people haven't heard of MoviePass yet, it just might be too late to do anything about it. A popular movie theater subscription service - wherein members pay a flat monthly fee to get the chance to go to a predetermined number of movies at their local theaters each month - MoviePass may be hitting on hard times.
MoviePass was founded in 2011, but it received a great deal of attention in 2017 when it announced moviegoers could essentially go to one movie each and every day of the month and still only pay about $10 (original plans had cost upwards of $30 a month and included an "endless monthly pass" option).
Variety reports that the company may have hit a snag, and it's already affected their stock price: MoviePass parent company Heliod & Matheson revealed its total available cash is just under $45 million. While this may seem like a lot, the company's monthly expenses are estimated at around $22 million. The parent company's stock also dropped almost 33 percent, down to $1.45 a share from $2.11.
Currently, MoviePass reimburses theaters in full for the tickets purchased by customers. As such, the monthly subscribers who pay $10, but go to the movies several times a month, are getting quite the steal. Meanwhile, MoviePass operates at a loss, taking said loss for presumably greater gains in the future. The plan, according to Variety, is to partner with theaters, advertisers, and so forth, and monetize the data it generates from its now more than 2 million subscribers.
The company's most popular service is the "movie-a-day" subscription package alluded to earlier. It had rescinded that particular subscription package for a time only to announce on May 2 that it was back. Earlier, MoviePass had disallowed repeat viewings of movies, an announcement made just prior to the release of Marvel's event film Avengers: Infinity War.
The monetary information was revealed via a filing with the Securities and Exchange Commission, which stated, in part, that because of their business model of purchasing movie tickets in full for their customers, their company's viability is coming into question. Things didn't go well for MoviePass the last time they raised prices for subscribers while simultaneously curbing the number of movies they could view each month. Members were angered by the changes. If going back down that path is the only way MoviePass can survive, then it seems they may not be around forever. Now, with services like Sinemia battling MoviePass for potentially the same audience, the challenges for MoviePass have increased.