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Author
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Topic: Meet the Lone Loser in MoviePass Hitting 1 Million Members
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Steve Guttag
We forgot the crackers Gromit!!!
Posts: 12814
From: Annapolis, MD
Registered: Dec 1999
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posted 09-17-2018 07:17 AM
I think the Movie Pass thing would have worked if they were less ambitious on how many movies one could see and to be up-front on the selling of data. I think if the plan was on the order of one movie a week, 52 movies a year for $120.00, they would have still gotten quite a bit of subscription. That is still dropping the price of seeing a movie to just under $2/movie. The avid movie goer would have gotten a very good deal and the average movie goer that sees to 2-3 movies a month would have gotten a decent deal too. However, the real value to Movie Pass would have been in the selling of viewer data...how far people drive, what movies different people see...etc. When listing theatres, they could have indeed made it easier to find theatres that partner with them (sort of like google searches). They could have also partnered with other industries like restaurants as another source of revenue.
But they went for a heavy loss system and then cut back on the selling of information leaving them no source of revenue and a massive cash drain. Their plan of stiff-arming exhibitors for a cut of the ticket and concession pie was a non-starter for most. Now, in some areas, that was a good deal as some exhibitors reported new business due to their MP relationship. And, indeed, I think there could have been deals, in some markets for MP to sell the ability to put YOUR theatre at the top of the list for a particular title.
I don't think it was an inherently a bad idea, but very poor execution with, seemingly, no thought on how to really turn a profit.
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Jack Ondracek
Film God
Posts: 2348
From: Port Orchard, WA, USA
Registered: Oct 2002
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posted 09-17-2018 10:32 AM
People can think what they want about how this "could have worked".
No major chain and 99% of all serious independents aren't going to give $3 off a ticket and 25% of their popcorn revenue to anyone, much less an arrogant outsider, who just waltzes in the door and tells them they're going to do it.
Without that revenue split from the really big chains, it's only a matter of time before this cartoon is over.
Lowe and Farnsworth misread their targets (theatre owners and subscribers from the beginning. The only reason people bought into it was the fake "really good deal", paid for by the investors they never saw. What many of them did see coming was the end, and used the service as much as they could. Moviepass cried foul, even though they set it up that way in the first place. Of course, people were going to use it, stupid! You were giving it away.
How many people drive a freeway at 50, knowing they could legally drive 70 if they wanted to? Just about nobody around here does.
Before long, this is all that'll be left of Moviepass. They can hang it on their walls as a reminder of how smart they were.
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Harold Hallikainen
Jedi Master Film Handler
Posts: 906
From: Denver, CO, USA
Registered: Aug 2009
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posted 09-17-2018 01:38 PM
How movie theaters are surviving big tech
https://www.axios.com/how-movie-theaters-are-surviving-big-tech-ee707f24-a5fe-4bf3-b0b6-cc2cfb429666.html
Technology companies are trying to disrupt the decades-old movie theater business, but unlike with other industries, they haven't entirely been able to crack the code.
Why it matters: Movie theater admissions have been relatively stable for the past three decades, despite the explosion of options technology has afforded consumers in entertainment. And those tech firms that are trying to break through the ticketing supply chain aren't having much luck.
MoviePass, the monthly subscription theater ticketing service with a beloved unlimited-ticket plan, has gone through a rough few months trying to develop a sustainable business model. And many analysts think it will be difficult for the startup to figure it out.
"MoviePass is going to be gone pretty soon. Up until the newest plan, unlimited tickets cost them $9.95. The average consumer watched three movies, so they spent a total of $25 and lost $15 ... It didn't make sense ... An exhibitor can offer that because it only has to pay the film rent."
— Michael Pachter, a research analyst at Wedbush Securities
MoviePass says it will survive. CEO Mitch Lowe said in an interview with Cheddar Wednesday the company will be profitable in 6-9 months, despite dragging shares for its parent company Helios and Matheson down by roughly 99 percent in the last year.
It recently introduced a new plan to limit monthly movie access to just three movies per month. Lowe says in one day "15% of our subscribers converted to 3-movie plan."
The problem for MoviePass, and other tech startups trying to disrupt the distribution landscape, like Sinemia, is that they will inevitably have higher costs than the theater companies themselves that are building competitive programs.
Cinemark announced Thursday that its subscription program Movie Club, which launched in December for $8.99 per month, reached 350,000 active members.
AMC announced last week that its subscription program "AMC Stubs A-list" has reached 182,275 members in five weeks.
To MoviePass' credit, Cinemark CEO Mark Zoradi told Deadline that MoviePass “has helped create awareness of subscription moviegoing," which could be what's helping boost theaters' programs.
Other big tech companies are investing in ticketing and theater ownership, but not for the purpose of competing directly with existing theaters.
Facebook brokered a partnership with AMC last month to help the theater chain sell tickets. Swapna Joshi, Facebook's product manager for movie ticketing, says it's "another way we're working to make going to the movies fun and easy." Facebook also has integrations with Fandango and Atom Tickets.
Netflix has considered buying movie theater chains in New York and Los Angeles, in an effort to gain an edge on Oscar nominations, per The Los Angeles Times. The company has said that it plans to release 80 original films this year.
Still, movie theaters need to innovate to capture consumers' shifting attention spans and to make sure their steady record of attendance doesn't slip.
Most are investing in new experiences to make the theater experience more dynamic, like fancier concessions and reclining seats.
They're also creating subscription programs that give customers more flexibility.
One area where tech is causing some concern, according to analysts, is the release window between studios and streamers.
Streaming platforms like Netflix, which are quickly approaching saturation in U.S. homes, often have rights to these movies within less than a year of theatrical debut.
This runs the risk of audiences getting used to waiting for content, rather than paying to see it in person. (Other rights releases for traditional television networks, Pay-per-view and DVR vary, but can be years-long.)
The window of release has caused a rift between studios and theaters for a while. Studios interested in cross-marketing want to get digital movies to viewers at home shortly after their release in theaters, but that makes theaters unhappy.
See original article (link above) for interesting graph on revenue through different channels.
Bottom line: Americans still like to watch movies, but more options for accessing them are forcing theaters to adapt. Forecasts (like the one above) suggest that they will continue to adapt enough to grow revenues — at least slightly.
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Jonathan M. Crist
Jedi Master Film Handler
Posts: 531
From: Hershey, PA, USA
Registered: Apr 2000
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posted 10-17-2018 06:34 PM
Well here comes the cavalry ..... late as usual.
New York AG launches probe into MoviePass parent company for allegedly misleading investors
New York Attorney General Barbara Underwood has opened a probe into MoviePass parent company Helios and Matheson, a person familiar with the matter told CNBC.
The attorney general’s office is investigating whether the company misled the investment community regarding the company’s financials, said the person. The investigation is in the early stages.
The attorney general is using the Martin Act, a statute designed to protect New York investors and the integrity of the financial markets from fraud.
It’s another stumble for MoviePass, which in recent months has repeatedly adjusted its movie subscription plans and taken out hefty loans to cover massive losses.
In August, Helios and Matheson reported a loss of $100 million in the second quarter, putting the company on pace to blow through its remaining assets in the span of months.
The company skyrocketed to popularity with an initial subscription that allowed moviegoers to see a film a day for $9.95 per month. But the popularity hurt profits, and MoviePass quickly adjusted the plan to limit the available movies, raise monthly prices and restrict the number of films users could see per month.
Meanwhile, Helios and Matheson’s stock lost practically all of its value. Based on the company’s most recently reported share count of 1.5 billion shares outstanding, the company trades at an implied valuation of $30 million.
Shares of Helios and Matheson fell 3 percent in extended trading Wednesday, though the stock trades for just 2 cents per share. A spokesperson for Helios and Matheson declined to comment.
NY Attorney General Investigates
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Martin McCaffery
Film God
Posts: 2481
From: Montgomery, AL
Registered: Jun 99
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posted 10-23-2018 09:26 AM
Just Stay Dead:
Variety
quote:
In a bid to save MoviePass, the struggling theater-subscription service’s parent — Helios & Matheson Analytics — announced a plan to spin off the division as a separate, publicly traded entity called MoviePass Entertainment Holdings.
HMNY said its board had preliminarily approved the spinoff plan that would combine MoviePass Inc. and other film related assets held by HMNY to create a “vertically integrated” entertainment company.
There’s no guarantee Helios & Matheson will be able to execute the spinoff. For one thing, HMNY said that it’s not sure such a transaction is allowed under Delaware law. Meanwhile, the company is under investigation by the New York Attorney General’s office into whether HMNY misled investors, and the company has been sued by investors alleging it deceived shareholders.
The proposed MoviePass Entertainment Holdings would include: the shares of common stock of MoviePass Inc. held by HMNY, which currently owns 92% of the outstanding shares; the membership interests of MoviePass Films, HMNY’s movie production company partnered with Emmett Furla Oasis Films; the membership interests of MoviePass Ventures, which was established to acquire completed films; Moviefone, which HMNY bought from Verizon’s Oath earlier this year.
“Since we acquired control of MoviePass in December 2017, HMNY largely has become synonymous with MoviePass in the public’s eye, leading us to believe that our shareholders and the market perception of HMNY might benefit from separating our movie-related assets from the rest of our company,” Ted Farnsworth, chairman and CEO of HMNY, said in a prepared statement.
Earlier this year, MoviePass touted that it had topped 2 million subscribers for its service letting customers see one movie per day for just $9.95 per month. But the deal was too good to be true: The surge in users caused an enormous cash drain on HMNY and the company was forced to take out several loans. To stay afloat, MoviePass drastically changed its offer in August to limit customers to only three movies per month for the same price and curtailed access to wide-release movies during peak demand.
Helios & Matheson said that “if permitted to do so under applicable Delaware law,” it plans to distribute a minority of the outstanding shares of MoviePass Entertainment common stock as a dividend to stockholders of HMNY as of a record date that is yet to be determined, with HMNY retaining control of MoviePass Entertainment.
Other caveats on the spinoff plan: According to HMNY, a dividend of MoviePass Entertainment shares and/or a contemplated listing of MoviePass Entertainment on Nasdaq (or an alternate trading market) are “subject to numerous conditions.” Those include: completion of the contemplated reorganization; completion of audited financial statements of MoviePass Entertainment; the filing and effectiveness of a registration statement by MoviePass Entertainment with the SEC; the approved listing of shares of MoviePass Entertainment on Nasdaq or an alternate trading market; and HMNY being permitted to distribute MoviePass Entertainment shares under Delaware law, “of which there is no assurance,” according to Helios & Matheson.
Following the MoviePass Entertainment spinoff, HMNY plans to retain its ownership of Zone Technologies and would discontinue its previously announced plan to spin off Zone. HMNY said it plans to continue focusing on data analytics and consumer-centric technologies.
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