January 28, 2019
MoviePass is relaunching its service with a marketing campaign that includes a billboard in Times Square and print ads. With the tagline “let’s go to the movies,” MoviePass’s second incarnation has to rise above the failure of its unlimited $9.99/month movie plan that drew millions of subscribers but then continually changed its terms to keep the company afloat. The new model includes both basic and “red carpet” plans whose price varies based on geography, with more expensive plans for cities where movie ticket prices are higher.
Variety reports that MoviePass believes this new plan is a “break-even model that will allow it to improve its service and continue to operate.” The pricing of the red carpet plan and other plans depend on location. For example, in the middle of the country, the ‘select’ plan, for three movies per month, starts at $9.95, with the red carpet plan at $19.95.
In major cities, where movie tickets are more expensive, that same plan ranges from $14.95 for ‘select’ to a $24.95 “red carpet” plan. The “red carpet” plans let subscribers see movies in IMAX, 3D and other premium formats.
MoviePass executive vice president Khalid Itum said the company will also “reintroduce some sort of unlimited program that would enable users to see as many movies as they wanted each month,” but he did not reveal pricing information. After shedding subscribers during its chaotic repricing period, according to NetBase, MoviePass has now begun gaining them, with customers’ positive feelings about the company rising from 44 percent to 59 percent last week.
“I feel like we’re turning a corner,” said Itum, who has been assuaging movie theater owners by meeting with them and presenting the new plans “he hopes will be more widely embraced.”
The company is offering an olive branch to theater owners by abandoning the idea of a revenue sharing model for concessions, which are a major source of profits for them, and instead “only charge a small service fee for items it sells.” MoviePass is also “abandoning a previous plan to ask theaters to give MoviePass a discount on the tickets that it sell,” and instead is offering exhibitors a so-called red label solution that “would enable them to launch their own subscription programs using MoviePass’s platform and technology.”
“Our new business strategy is stabilize, optimize, and grow,” Itum said.
Still, MoviePass’ parent company Helios and Matheson Analytics “has lost hundreds of millions of dollars over the past year and its stock is about to be delisted for failing to meet Nasdaq’s $1-a-share price requirement.”