retail news in context, analysis with attitude

by Kevin Coupe

Salon reports on a new startup, MoviePass, created by Mitch Lowe, a co-founder of Netflix, which he says is designed to address the trend toward plummeting ticket sales at the nation’s movie theaters.

Noting that 2016 was the “worst year for Hollywood” in history, and that 2017 may end up being even worse, Lowe wants to create a system that allows people to spend $9.95 for a monthly pass that will allow them to see one movie in theaters every day of the month. According to the story, the fee would cover “the costs for all movies a subscriber attends, excluding 3D and IMAX screenings, as long as the theater accepts debit cards.”

The premise for the business model is that people don’t go to movie theaters because of ticket prices, as opposed to the availability of streaming options. Investors believe that the development of a robust subscriber list will allow them to market those names to advertisers in a highly targeted fashion, because they will have information about demographics, entertainment preferences, and frequency.

MoviePass currently has 20,000 subscribers, but an investment from a pair of data and analytics firms is expected to ramp up marketing efforts.

The Los Angeles Times, however, writes that “AMC Theatres on Tuesday criticized the service in a sharply worded news release with bold type proclaiming, ‘Not welcome here.’ AMC called MoviePass a ‘small fringe player’ whose plan was ‘not in the best interest of moviegoers, movie theaters and movie studios.’ AMC also said it will try to block the service from its theaters.”

This is an interestingly disruptive business idea, though my inclination is to disagree with the basic premise. I don’t think movie theaters are all that expensive - in most cases, one can get a couple of hours of entertainment for less than $15. That’s not so bad. (The Twizzler prices are way out of whack, but that’s not the issue here.)

To me, the problem is the content - if movies aren’t that good, people don’t go to the theater. Even ten bucks a month is too much if there’s nothing to see.

I say all this as someone who probably sees 40-50 movies a year … it is what I do, and an art form I love. But I recognize that I’m in a minority that is getting smaller all the time.

Still, the MoviePass is an Eye-Opening idea … if only because it reflects the a disruptive mindset that can affect everyone and anyone.
KC's View: