The Death of Moviepass
FILE – In this Jan. 30, 2018, file photo, Cassie Langdon holds her MoviePass card outside AMC Indianapolis 17 theatre in Indianapolis. MoviePass, the discount service for movie tickets, is raising prices by 50 percent and barring viewings of most major releases during the first two weeks. (AP Photo/Darron Cummings, File)
April 9, 2019
Moviepass, a subscription based movie ticket service has been losing thousands of customers and millions of dollars as recent as summer of last year.
Moviepass began in 2011 as a luxury for the wealthy. Mitch Lowe, the co-founder of Netflix started the company. He saw it as a competitor to his previous company since Netflix was mainly about watching movies at home.
Moviepass brought the convenience of going to unlimited movies for only $35 a month. With the average movie ticket being $12, Moviepass seemed like a great deal, but that was only scratching the surface.
At $35 a month, Moviepass could not make ends meet. The company was losing thousands of dollars every month. Not to mention the rising success of Netflix growing every year. In 2016, Mitch Lowe was announced as the new CEO of Moviepass. He brought with him new ideas which led to both the rise and fall of Moviepass.
Starting in summer of 2017, Moviepass changed its monthly price from $35 to just $9.99 in order to compete with Netflix. This caused an instantaneous uprising of Moviepass. Unlimited movies for no more than $10 a month.
Another university news source called the NYU Local states that Lowe believed people weren’t going to the movies because of other options like Netflix and Amazon. In reality, it was the rising price of tickets and refreshments at the theaters that drive customers away to other options like streaming services.
A business losing out on millions of dollars every month could never make that money back. Moviepass having a monthly fee of $9.99 when the average ticket price for one movie is more than that. Moviepass just couldn’t keep up with the amount of money it was losing regardless of how many subscribers they had received. Moviepass filed for bankruptcy in August 2018 but ruled out the bankruptcy by October 2018 claiming that they have raised over $65 million in funding without saying from where. Moviepass then changed their plan from having unlimited movies a month to only three movies. This was a huge blow to the company in their attempts to try and save money as thousands of customers cancelled their subscriptions.
What started as a potential competitor to Netflix ended up being one of the worst business practices of the year.