Everybody loves a good trip to that new major box office movie. However, the price may keep you at bay. With ticket prices skyrocketing, it’s no surprise that ticket sales at theaters are down.
MoviePass is a new monthly subscription service where for $9.95 a month, you can see one movie per calendar day. The appeal of the service is that if you go to the movies more than once a month, the service pays for itself.
To see a movie, the user goes to the theater, opens the MoviePass app, then selects the theater, movie, and time they wish to see. Once they have checked in, funds are instantly loaded onto a MoviePass debit card (this is sent to the user upon subscribing). Now the user simply purchases a ticket from the ticket counter as they would with a normal debit card.
The company is soaring in popularity; its number of subscribers is now in the millions. But here is the problem that critics are quick to point out- the way the service is setup, it operates at a loss.
Mitch Lowe, CEO of MoviePass, is playing the long game. He plans to make money not from subscription income, but from two other sources.
First, they plan on selling basic data on its users to companies indicating which demographics see what, when, and where. No personal data that could be used to identify a single person is sold.
Second, they believe that soon theaters and studios will share profits with them. They believe this because once theaters see that MoviePass is increasing the number of patrons, they are more likely to pay to have their theater displayed first on the screen of the app. Second, studios will pay to have their movies advertised by MoviePass as there is preliminary data that shows this increases the number of users who see the movie.
The future of MoviePass remains uncertain. By operating at a loss in hopes of future profits, they must be kept afloat by Helios and Matheson, an IT company that purchased a majority stake in the company. Verizon also owns stake in MoviePass. If the company manages to stay afloat they could have the potential to be the only service on the market with no company able to match the data they have on movie goers.
Whether MoviePass will be the next Bitcoin, or will be bankrupt within the next year remains to be seen, but for now it is a wildly popular service that is driving people back to the theaters.