Thursday, September 29, 2022

MoviePass is back at exactly the wrong time for Hollywood

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MoviePass is coming back, whether theater chains want it to or not. The movie ticket subscription service, which flamed out in 2019 and declared bankruptcy just two months before the pandemic, is opening up membership signups to a new version of the service set to launch on Sept. 5.

One of the founders of the service, Stacy Spikes, is behind the relaunch, but he hasn’t delivered much detail on how the new service will succeed where the old one failed. Previously, members of MoviePass were able to go to theaters to watch multiple movies per month under a flat fee, but because the company didn’t have discounted bulk ticket deals with movie theater chains, MoviePass paid full price for tickets in the interest of boosting subscriptions, which eventually reached 3 million users in 2018.

Spikes co-founded the company in 2011, but was ousted in 2018, just before the publicly traded analytics firm Helios and Matheson bought a majority share of MoviePass. The company’s constantly shifting pricing tiers, attempts to curtail user activity, and lax data security led to collapse.

MoviePass, once the Hollywood disrupter, has been disruptedThe 2022 version of MoviePass, complete with a new logo, will have three general pricing tiers of $10, $20, $30 that may differ by market. Each level will give a different amount of credits for members to use to see movies. Spikes hasn’t revealed much else, but it’s clear that, for now, he’s attempting to keep the subscription base manageably small by capping new memberships within a five-day window that ends on Aug. 29. After that, existing members will be able to invite 10 friends to the service.

MoviePass is entering an entirely new entertainment environment compared to 2011, when Spikes first launched the service. Theater chains have caught on to the subscription service trend, and now AMC’s Stubs A-List subscription service, launched in 2018 to compete with MoviePass, now claims nearly 1 million paid members. Similarly, in 2020, Alamo Drafthouse launched its Season Pass subscription service, which replicates many of the features that were present in MoviePass.

The post-pandemic movie business will be even tougher for version 2.0 of the serviceNow that pandemic lockdowns have largely subsided, movie theater closures, and the revenue hit they incurred, are mostly in the rearview mirror. But Hollywood studios’ approach has shifted towards hybrid and, in some cases, direct to streaming releases, creating new business challenges for movie theater operators.

In that respect, there may be little incentive for theater chains to work with or accommodate the new MoviePass in any way. A third-party service like MoviePass is a middleman that Hollywood, and theatergoers alike, may not have much use for.

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