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Author
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Topic: Meet the Lone Loser in MoviePass Hitting 1 Million Members
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Rusty Gordon
Film Handler
Posts: 33
From: Fairview, Tennessee USA
Registered: Feb 2004
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posted 08-29-2018 02:11 PM
Many MoviePass subscribers no longer find it trustworthy or reliable, survey finds
by Sarah Toy
MoviePass subscribers are very disgruntled.
In the spring, a National Research Group survey of MoviePass customers conducted for The Hollywood Reporter found that 83% of patrons were more satisfied with the service than any other subscription service.
That was in March. In a follow-up survey of 1,558 moviegoers done in mid-August, that number fell to just 48 percent. The survey sample included 424 MoviePass subscribers and 100 people who had recently canceled their memberships. The results were published by The Hollywood Reporter on Tuesday.
Forty-seven percent of the MoviePass customers surveyed said they were considering canceling their membership, while just 37% said they were planning to stay with the service.
Fifty percent of those who canceled said they did so in the month prior to the survey. The two top reasons customers cited for canceling were MoviePass’s constant rule-changing and the inability to see their movies of choice, according to The Hollywood Reporter.
“MoviePass’s innovation was offering the freedom and flexibility to see any movie, at any time, at almost any theater, for a low price,” NRG CEO Jon Penn told The Hollywood Reporter. “By constantly changing the terms of service — limiting which films subscribers could see and when they could see them — MoviePass has eroded brand trust and undermined their leadership position.”
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MoviePass has changed its pricing model numerous times in the years since its debut. In 2011, a beta version of the service debuted in San Francisco, charging a monthly fee of $50 a month for customers to watch an unlimited number of movies. In 2012, the company moved to a pricing system that charged between $25 and $40 depending on what movie theaters charged in a particular area.
In 2016, former Redbox executive and Netflix co-founder Mitch Lowe took over the role of CEO. Under his stewardship, MoviePass tested price plans that allowed users to see six films for $40 to $50. Customers were ticked off, and MoviePass ended its testing and went back to an unlimited plan for $40 to $50 per month, again depending on location.
In August 2017, Helios and Matheson Analytics Inc. HMNY, -8.65% acquired a controlling stake in the company, and MoviePass again changed its pricing model — this time settling at $9.95 a month for one movie a day.
Subscriber numbers surged, hitting 1 million in December 2017 and surpassing 3 million in June 2018. But securities filings in the spring and early summer of 2018 showed the company was burning through cash at an alarming rate. Its monthly cash deficit was ballooning, and the company began to make a series of cash-making moves, entering an agreement to issue 20,500 shares of preferred stock and $164 million in convertible notes and filing a shelf registration statement to raise $1.2 billion over three years by issuing equity and debt.
Read: The spectacular rise and fall of MoviePass
Also read: Student-run fund preparing bailout plan for MoviePass, but it may be unwanted
Then, in early July, MoviePass announced it would be launching “peak pricing,” essentially a surcharge for popular films shown during popular showtimes, angering many subscribers who had signed up under the assumption they would only have to pay a flat monthly fee.
Still further irritating users, significant service interruptions began to occur due to Helios and Matheson's inability to make “required payments to its merchant and fulfillment processors,” according to the company. In early August, the company announced it would be implementing yet another new monthly fee of $14.95 and limiting access to certain popular newly-released movies.
MoviePass changed course a few days later after a barrage of complaints, saying it would be going back to its $9.95 monthly fee, but would cut subscribers’ film allowances to three movies a month.
“We’ve been whipsawing people back and forth,” Lowe told The Wall Street Journal at the time. “I think we’ve got it now.”
But for moviegoers, it may be too little, too late. According to the National Research Group’s poll, the percentage of customers who would be “very likely to recommend” MoviePass dropped to 52% from 84% in March. Fifty percent are worried that MoviePass “won’t last,” a significant chunk more than the 32% who said the same in the spring.
And other movie subscription services are gaining traction. Twenty-three percent of the total number of moviegoers surveyed said they were in favor of AMC Theatres’ AMC, -0.52% Stubs A-List program, which allows customers to see three movies a week in any format for a $19.95 monthly fee.
Read more: AMC’s subscription program now offers a better deal than MoviePass
Neither MoviePass nor Helios and Matheson responded to a request for comment by the time of publication.
Shares of Helios and Matheson have plummeted 100% in the year to date and are currently trading at just over 2 cents a share, despite the company implementing a 1-to-250 reverse stock split in July. The S&P 500 SPX, +0.55% has gained 8.3% so far this year.
MarketWatch Link from 8/29
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Harold Hallikainen
Jedi Master Film Handler
Posts: 906
From: Denver, CO, USA
Registered: Aug 2009
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posted 09-16-2018 12:57 PM
MoviePass executive resigns, citing management issues at once-trendy ticketing service
Another shoe just dropped at troubled movie ticketing service MoviePass.
Carl Schramm, a member of the board of directors for MoviePass' parent company Helios and Matheson Analytics, has resigned citing concerns about corporate management.
It's the latest issue for the once-trendy movie ticket subscription service, which revamped its subscription model recently to offset its cash burn. The ticketing service grew to more than 3 million subscribers when it began letting members see one movie each day for a $9.95 flat monthly fee. But two weeks ago, it reduced that to three movies a month.
"We believe this new business model will immediately reduce our burn so we can refocus our efforts where they belong: making a permanent and positive change in this industry by creating an amazing theater-going experience and building a company that continues to benefit our nationwide community,” Ted Farnsworth, chairman and CEO of Helios and Matheson Analytics, said at the time.
Schramm cites concerns about how Helios and Matheson Analytics' corporate strategy in a letter to Farnsworth dated Aug. 25.
"I have objected to the manner in which a number of business decisions have been presented to the Board of Directors by management, without sufficient time for the Board to examine complex documents, to review significant transactions, or to discuss how the proposed actions fit into the Company's strategic plan," Schramm says in a letter, a copy of which was filed with the Securities and Exchange Commission.
His concerns have escalated over the last two months, Schramm says, "as management apparently has made a number of important corporate decisions and executed significant transactions either without Board knowledge or approval, or in Board meetings initiated with only a few hours of advance notice by email."
At least one meeting ended before he knew it had been called, Schramm says in the letter. "Just last week, I learned that management withheld material information from the Board for several months," he said.
Earlier this month, MoviePass opted not to raise its price to $14.95, as planned, but did reduce the number of movies subscribers can see, saying the revamped plan focuses on the majority of subscribers who see three movies or less monthly.
Last month, the company applied for an emergency $5 million loan, which it has since repaid, when it ran out of cash. The MoviePass app suffered technical difficulties that weekend, and the company issued an apology over Twitter.
The concerns and changes in the subscription plan, which is accepted by more than 90 percent of theaters, has left an opening for competitors. Two months ago, AMC launched its own Stubs A-List $19.95 monthly service, which lets moviegoers attend up to three movies a week, including special theater screenings such as 3D and IMAX showings – a perk MoviePass does not allow.
Another competitor, Sinemia has a range of movie ticketing subscription plans starting at $3.99 monthly, including two $9.99 monthly plans – one for three movies monthly with no blackout dates and another for two movies monthly including IMAX and 3D showings. Its membership plans range from $3.99 monthly (for one 2D movie a month) to $14.99 for three movies each month. It also has family plans starting at $7.99 for two tickets to a film each month.
Sinemia's $7.99 monthly subscription for two movies at any theater was highly rated in a National Research Group survey released this week, with 41 percent of the 1,558 moviegoers surveyed saying they would be "very likely to subscribe" to such a plan.
MoviePass has lost some clout in brand perception, NRG says. Satisfaction in MoviePass has fallen over the past five months, the research group says, and 50 percent of those who have cancelled the service have done so within the past month. Only 37 percent of current MoviePass subscribers in the survey said they planned to stay with the service "for a long time," a decline from 62 percent in March.
Some subscribers are giving MoviePass the benefit of the doubt. Justin Kangas, of Waldoboro, Maine, said he is not bothered by the new monthly limit. He sees three movies or less a month, which MoviePass has said is typical for 85 percent of its members. He is disappointed, however, by the company’s “inability to communicate clearly, provide adequate customer service and rapid-fire changes.”
“Hopefully they figure things out because at the end of the day, we need a more affordable way for your average consumer to see movies at the theater if theaters are going to survive,” said Kangas, a school principal who has been a subscriber for a year.
Despite MoviePass’s recent problems, consumers sill have a "healthy appetite for movie ticket subscription services," NRG said in the survey, with 39 percent of moviegoers "expressing definite interest in a vibrant subscription-based plan."
Helios and Matheson Analytics (HMNY) shares have fallen from a share price of more than $2 in January to two cents Thursday, despite a reverse stock split last month. In June, NASDAQ notified the company that its shares could be delisted from the exchange if it does not return to $1 per share or more by Dec. 18.
Losses of $104 million during April-June period, primarily due to operating expenses of MoviePass, led HMNY to report a net loss of $83.7 million for the quarter ending June 30, 2018.
Amid all its problems, MoviePass has launched a contest to "celebrate" the first anniversary of dropping its monthly fee to $9.95. The prizes in the "Ultimate MoviePass Getaway" contest, which runs through Friday, include a Los Angeles trip for two, annual MoviePass passes and other swag worth $4,000.
Contributing: Kelly Tyko, The (Stuart, Fla.) News. Follow USA TODAY reporter Mike Snider on Twitter: @MikeSnider.
Copyright 2017 USATODAY.com
https://www.krem.com/article/news/nation-now/moviepass-executive-resigns-citing-management-issues-at-once-trendy-ticketing-service/465-de4d74e4-58fc-4ee6-9b34-28ff2d69b250
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