MoviePass Returns with a New Business Model and its Original CEO

Photo by Daniel Loria

MoviePass, the cinema subscription service that helped establish the concept in the United States, is making a comeback in 2022. The company was acquired from bankruptcy by its co-founder and former CEO Stacy Spikes, who first launched MoviePass in 2011. Spikes’ first stint at the helm of the company came to an end months after MoviePass was acquired by tech firm Helios & Matheson in 2016. Under Helios & Matheson, MoviePass slashed the price of its universal cinema subscription plan—which allowed users to view films in nearly any cinema in the United States—to $9.99 per month. The aggressive pricing strategy found traction with audiences, reaching 3 million subscribers at its peak in June 2018. The low monthly price proved to be untenable, however, leading to the company’s demise in the fall of 2019

Taking the stage at New York City’s Walter Reade Theater, the home of Film at Lincoln Center, Spikes announced a summer 2022 relaunch for the third-party subscription service. This third iteration of MoviePass will be markedly different from those that preceded it. “A lot of people lost money. A lot of people lost trust. There were a lot of people who were hurt and disappointed. I was one of those people who were hurt and disappointed too,” says Spikes when describing the sudden rise and precipitous fall of MoviePass. This time around, rather than exclusively seeking Venture Capital funding, Spikes is making it possible for MoviePass to own a part of the newly reformed entity, calling it “a company that is built by its fan base.”

The new MoviePass will seek to create an end to end cinematic marketplace, collecting users’ moviegoing data across a range of participating circuits. Currently, any insights gleaned from a consumer’s moviegoing habits is limited to each respective circuit’s loyalty program. A general database of an individual’s moviegoing behavior will, according to MoviePass, provide a more accurate perspective of viewer trends and will help better define marketing segments and promote off-peak showtimes and promotions. Spikes claims that MoviePass was responsible for 4% of the domestic box office revenue during its peak in 2018—a figure that helped independent and art-house titles achieve higher-than-expected returns in the domestic market.

When MoviePass relaunches this summer, it will employ a virtual currency that will drive a credit-based system where users can select a showtime from a list of participating theaters. Each showtime, title, and location will cost users a set number of credits. Those credits will roll over from month to month and will include new perks for members, such as the ability to bring a companion to their MoviePass screening. Users will also be able to transfer unused credits to other members. The new MoviePass will also integrate Spikes’ PreShow venture, designed to provide users credits for viewing video ads from brand partners. The service will have different pricing tiers, but Spikes did not provide further details on the program’s monthly cost or price range during the presentation.

As MoviePass prepares for its summer relaunch, several key questions remain about the brand’s appeal with moviegoers and exhibitors alike. Despite being prevalent in many overseas markets since the start of the new millennium, none of the major circuits in the United States offered subscription plans when MoviePass first launched in 2011 or when it was acquired in 2016. Today, each of the country’s top three circuits offer their own in-house plans: AMC’s A-List, Regal’s Unlimited, and Cinemark’s Movie Club. The fourth, Marcus Theatres, is currently piloting its own subscription plan in two states. That means every exhibitor in the United States with over a thousand screens has its own competing subscription service, a factor that could limit where MoviePass is accepted in its relaunch. Several of those exhibitor plans integrate Premium Large Format screenings, either as a standard feature or at an upcharge, a reflection of the growing popularity of premium formats among audiences. It is unclear how (or if) MoviePass would integrate PLF showtimes under its new structure. 

Rival third-party subscription plans have tried, and failed, to take off since the demise of MoviePass. Sinemia was a contemporary competitor to MoviePass in the late 2010s, until it ran into its own financial troubles and went out of business before the end of the decade—leaving scores of disgruntled subscribers in its wake. Cinema tech provider Influx attempted to launch its own universal third-party subscription platform, Infinity, going on to secure letters of intent from 3,500 screens in the U.S. ahead of a scheduled 2020 launch. Influx claims to have garnered “keen interest” from 27 cinema chains and 3 studios before the Covid-19 pandemic delayed Infinity’s launch. Influx announced it was abandoning the Infinity project in June 2021, citing a lack of confidence in the business model “working fast enough to benefit cinema operators and consumers” under the post-Covid paradigm of theatrical exhibition. Influx instead turned its attention to providing individual cinema circuits with their own in-house subscription programs.

These factors all present a radically different business climate in the re-introduction of a universal third-party cinema subscription service in the United States. Complicating matters further are the myriad of structural changes the pandemic has introduced: shorter exclusivity windows, day-and-date releases, an inconsistent release schedule, and a decrease in the number of studio titles made available to theaters.

If the new MoviePass can find traction with enough exhibitor partners—possibly through a combination of art-houses and independent cinemas that could provide the scale for a national network of theaters—its impact may revitalize an ailing sector of the movie business. According to the company’s data, the last iteration of MoviePass was most successful as a discovery tool by enticing ticket purchases for titles moviegoers may have otherwise not seen in theaters. With the right partners giving MoviePass a proper national presence, its relaunch could potentially expedite the sector’s recovery by promoting off-peak attendance and boosting specialty and mid-range titles at the box office.

Ultimately, the fate of MoviePass in its relaunch no longer rests on the viability of a cinema subscription among U.S. consumers—it has already proven it can succeed—but in how it can compete against in-house programs instituted by cinemas themselves. Are audiences willing to subscribe to two (or more) cinema plans? Can MoviePass compete with the tiered pricing structure set by major circuits’ own services? And just how many theaters, showtimes, and formats will be accessible to consumers?

Photo by Daniel Loria

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