MoviePass vs AMC and the Future of Theaters

$10 a month for a movie a day? Sign me up.
September 12, 2017
8 mins read

The movie theater experience has been long romanticized as an escape from the real world, a place where you go to dive into fantasy and immerse yourself in a world free from your own worries. And who doesn’t love grabbing a huge bag of buttery popcorn and treating yourself to the theater experience? However, the price of that experience has jumped up so steeply, many college kids can’t rationalize spending $10-$15 for a movie ticket when they could just as easily spend a fraction of that price once it comes out on DVD.

Luckily, for all the broke college students out there who still love a good movie, MoviePass wants to swing in and save the day, much to the chagrin of some major theater chains.

MoviePass works similarly to a Netflix subscription, but on the big screen. If you pay $10, you get to see one movie every single day of the month, all covered by that small cost. All you have to do is download the app and you will be mailed a credit card which you will use to check in at eligible theaters. MoviePass still pays the full price of the ticket, though it only works for single admission for 2D movies, but you free yourself up to buy that large popcorn you’re always eyeing.

The subscription service started in 2011—though it hasn’t received much buzz until recently—and was created by Mitch Lowe, the co-founder of Netflix. Lowe hopes to do with the movie industry what Netflix did with television and streaming—and for some theaters that is a scary proposal. Just look at how Blockbuster fared after Netflix got popular, and you can see why. Not all theaters accept MoviePass, but nearly every large chain, as well as some smaller indie theaters, allows you to use the app when you purchase your ticket.

So how has no one heard of this amazing invention before? Well, there isn’t really an answer for that (maybe it was the pricier subscription cost before this month), but now that MoviePass is in the public eye, things are getting heated in the theater industry. MoviePass made headlines on almost all of the major news outlets recently after AMC Theaters announced that they were looking into ways to block the app from their theaters.

If MoviePass still pays full price for the tickets, why does AMC want to prevent the app from being used in their theaters? Well, AMC’s stock has been dropping as of late, and they really depend on their own loyalty programs instead of an outside party, especially since they have invested so much into them. MoviePass claims that it boosts attendance in theaters by 111%, but AMC still isn’t into it and has been continuously bashing MoviePass’s business model.

And they do have a point. It will likely be hard for MoviePass to turn a profit for a while, since they have to rely on customers in smaller cities with cheaper tickets not seeing very many movies and offsetting the price from those in the city. Lowe hopes that in the future, theaters will cut MoviePass in on their profits as well, since using the subscription service reportedly boosts concession sales as well as attendance, but based on AMC’s reaction, who knows if any theater is going to want to align with MoviePass. For the viewers, however, it seems too good of a deal to pass up.

Originally, AMC was actually a major partner in MoviePass, and the price was initially around $45 a month instead. Now, however, the price has dropped, and AMC worries that when their business plan eventually and inevitably fails, that people will no longer pay full price for movies anymore. In the wake of AMC dropping out, however, the major stakeholders in MoviePass now include Helios and Matheson, aka a publicly traded data firm.

But wait, what does “publicly traded data firm” even mean? Good question. Essentially, the company can definitively know which movies you see thanks to the data from the app, and can then use that information to better target other ads to you, which could mean a lot of things for the future of movies and the future of advertising them. If advertisers know exactly what genre you prefer and exactly how many times you saw how many movies, then they know exactly which buttons to press and trailers to curate to make you see the movies you want. Is that a little intimidating of a thought? Sure, but you really can’t beat $10 a month.

This marketing hack is another way MoviePass plans to offset their costs. Big studios might pay big bucks for the kind of data that will help them make successful movies. Is that an invasion of privacy, or will that enhance the viewing experience of every party involved? Well, it can certainly turn into speculation and debate on both fronts. On one hand, it could be seen as a totally invasion of privacy for a company to be selling your data and trends to outside parties in order to increase their own profits. On the other hand, the only harm it’s doing at this point is allowing studios to make movies that you will probably end up liking. Is there a point where data collection can go too far, or is it worth it in the long run?

All of these arguments are largely hypothetical at this point, and will likely be so until MoviePass either sinks or swims. At this point, you might have to be crazy to pass up a movie a month for only $10, especially if you’re in college and on a tight budget. In the end, maybe AMC is right and MoviePass’s unrealistic business model will never work. But hey, why not enjoy some cheap movies while it’s still out there?

Abbey Slattery, Northwestern College

Writer Profile

Abbey Slattery

Northwestern College
Writing & Rhetoric

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