This article was originally published on Viking Social Agency on September 16, 2019

In what is quite possibly the most spectacular “plane crash” in the history of the entertainment industry, MoviePass is shutting down.

On September 13th, the services parent company, Helios and Matheson Analytics Inc., announced they will be shutting down the once popular app, effective September 14th. The service, at one time, boasted to reach 3 million followers, until it began to hemorrhage money quicker then they could make it. The company tried to finance movies (you can pre-order 10 Minutes Gone starring Bruce Willis on Amazon now), and offer a new way for people to see movies, at an affordable rate. The idea was honestly sound, but the execution left much to be desired. 

MoviePass’s troubled history started around the time that Avengers: Infinity War was released in theatres. Anticipating the high volume of repeat movie-goers for the popular film, MoviePass stopped users from seeing a movie more than once and created surge pricing requiring viewers to pay more for a movie then the normal $10 a month. While MoviePass didn’t admit it, subscribers suspected this was due to the fact that the business model was not sustainable. 

CEO Mitch Lowe went on the popular YouTube channel, ScreenJunkies, to inform people that there was nothing to worry about. He explained this model had been thought through and theatre chains will “play ball” and offer discounted ticket prices to MoviePass in order to save some money. The message was clear: MoviePass knows what they’re doing.

After it was made very clear that the fastest growing company in the United States didn’t know what they were doing, they began to lose subscribers. They implemented a new tiered subscription service with higher pricing and with certain movies blocked out. For example, many MoviePass subscribers, couldn’t go to see Mission: Impossible – Fallout

Around this time, one of the major theatre chains in the world, AMC, decided to launch their own service. An extension of their current Stubs program: AMC Stubs A-List. For $20 a month you could see 3 movies a week in any format. Not quite as good as MoviePass’s initial unlimited plan for $10 a month, but it worked. Now, that service has almost 900,000 subscribers, after being around for about a year. Other theatre chains, such as Cinemark and Regal have similar services for patrons.

Reports began to surface that MoviePass was still charging people for subscriptions that had been cancelled and that they had filed for bankruptcy. In July of 2019, MoviePass “temporarily” shut down, claiming that they were just looking for a way to become profitable. Apparently, that did not happen.

However, for all the problems that MoviePass caused, it did shock the system. Movie ticket prices are quite high these days and most middle class movie goers cannot afford to go more than once a month. This is why the big tentpole films do better then the independent films. If you’re going to spend $20-$40 when going to the movies, you want to guarantee you’ll have a good time. 

MoviePass proved that audiences want a more affordable way to watch movies. Even though movie theatre attendance keeps lowering, while the subscription service was active, movie theatre attendances rose, and, most movies that wouldn’t otherwise have done well, did. It’s clear now that audiences didn’t have a lack of interest in seeing medium to small level films, they just lacked the means to do so. The mistake that MoviePass made was lowering the price and then expecting theatre chains to fall in line after the fact. While theatre chains are seeing success with their own subscription services, a combined service that allows audiences to see any movie they want, at any theatre they want for a lower price, could be what the theatres need to save their industry.

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