Since 2011, MoviePass has offered a service to moviegoers that allows them to pay a monthly subscription fee in exchange for the ticket to one movie per day. The service worked like a credit card, so essentially any theater that used Discover would work with MoviePass. The subscription was based on a tiered system according to Variety, with prices ranging from $15 to 50. But now, after a majority sale to the company Helios and Matheson Analytics, MoviePass is lowering their price to $9.95 per month and it seems to be ruffling a few feathers in the industry.
According to Mashable, AMC is the first theater chain to cry foul over the price drop. The largest theater chain in the United States seems to be confused by where MoviePass is heading with their business plan and doesn’t want any part in finding out, sending out a biting statement that rejects the plan:
“While AMC is not opposed to subscription programs generally, the one envisioned by MoviePass is not one AMC can embrace,” the theater chain said. “We are actively working now to determine whether it may be feasible to opt out and not participate in this shaky and unsustainable program…
“From what we can tell, by definition and absent some other form of other compensation, MoviePass will be losing money on every subscriber seeing two movies or more in a month”
The full statement over at Mashable is far more heated, even quoting a Bloomberg article that calls MoviePass’ plan “crazy” and says it is setting up consumers for the “ultimate disappointment” in the future. The problem with AMC’s statement is that they technically can’t deny MoviePass users from coming to their theater to see movies. Variety notes that the theater chain is “consulting with its attorneys,” but as of now they are only speaking out about their disappointment. As CEO Mitch Lowe tells Variety, the statement doesn’t concern him in the way you would think:
“I’m not worried about it killing the sale,” he said. “What I’m worried about is it confusing customers and making them believe they can’t use this service at AMC theaters.”
Lowe does acknowledge that the company will be operating from a loss by “subsidizing” customers, but the end goal is to become “whole” with theater chains and revive the theater business in a way that everybody benefits:
“We know we have to prove the value we deliver and, at that point in time, where we’re delivering value to studios and theaters, we can work together with them in a constructive manner so that everybody makes more money.”