Is Movie Pass Going to Change Its Price Again
Source: MoviePass
UPDATE–May 6, 2018–The day after we reported MoviePass'southward latest alter, limiting subscribers to four movies per month instead of ane per day, Diversity reported that MoviePass has inverse its mind yet once again, bringing dorsum the picture-a-24-hour interval program. MoviePass CEO Mitch Lowe commented on the alter in an interview.
'Nosotros never planned to abandon the flagship production that everybody loves,' Lowe said. "Any time we've washed a promotional package, we've taken the monthly plan off our site.'
This is contrary to what Lowe said the previous calendar week in an interview with the Hollywood Reporter in which he said he didn't know if the company would return to the movie-a-mean solar day plan. As nosotros commented in our Insider Take last calendar week, MoviePass doesn't seem to have a good grip on where it is headed. They change their plan regularly, whether it is pricing or the plan itself. Who knows what changes are coming next. Nosotros're not even sure if MoviePass can answer that question.
With just over 2 million subscribers, MoviePass has inverse its subscription offer…again. New subscribers tin can sign up for $nine.95 a month, merely they volition only be able to come across a picture a week, or four 2D movies a month, instead of the motion picture-a-day plan previously offered. This news comes two weeks after announcing a special subscription promotion with iHeartRadio, limiting new subscribers to four movies per month. It is not clear how this change impacts current subscribers.
Irresolute its offer seems to exist more than of a rule than an exception with the visitor. In fact, MoviePass regularly changes its pricing, with its about recent pricing change in December when the company lowered the price to $six.95 a calendar month. Prior to that a MoviePass subscription was priced at $ix.95, and before that, the company switched from a tiered pricing model.
Nether that model, there were iii tiers: Tier 1 markets ($15 for 2 movies, $22 for 3 movies and $xl for unlimited movies), Tier 2 markets ( $xviii for 2 movies; $27 for 3 movies; and $45 for unlimited movies), and Tier 3 markets ($21 for 2 movies; $31 for 3 movies; and $50 for unlimited movies).
In past columns, we've questioned the company's business organisation model. While subscribers are paying between $half dozen.95 and $ix.95 a month, MoviePass is paying movie theaters full price for each ticket. If a subscriber goes to see more than one movie in a month'southward time, MoviePass loses money. In the past, MoviePass has explained that information technology makes coin on the data it gleans from moviegoer habits.
In the company'southward latest ten-K filing with the SEC, dated April 17, 2018, parent company Helios and Matheson Analytics Inc. said its goal is to encourage increased attendance at motion-picture show theaters, targeting movie goers who see a movie less than one time a month which they believe represents 82 percent of the total pic going market. The visitor likewise said that its buying power is most vi.1 percent of the U.S. box function market place, with i in 17 tickets beingness purchased via MoviePass.
'Through its continued efforts at targeting and improving the consumer experience, MoviePass aims to maintain its stiff subscriber growth and to leverage such growth with its key constituents to amend operational efficiencies, create cross-platform synergies and create multiple growing revenue streams,' said MoviePass in the ten-One thousand filing.
The visitor plans to use additional strategies to support its growth, including:
- Family and friends offers
- VIP lines
- Promotions
- Incentives for specific films
- Revenue agreements with film distributors
- All-encompassing social media marketing campaigns
- Premium championship placement within the MoviePass app
A particularly concerning note in the 10-K indicators the 'substantial incertitude' expressed by independent auditors that the company is sustainable as it is currently operating.
'Our independent auditors have expressed substantial doubt nearly our ability to continue every bit a going business, which may hinder our ability to obtain futurity financing.
The written report of our independent auditors on our consolidated financial statements for the year ended December 31, 2017 included an explanatory paragraph indicating that there is substantial doubt about our ability to continue as a going business organisation. Our auditors' doubts are based on our incurring significant internet losses and our working capital position. Our ability to continue as a going concern will exist determined by our ability to obtain additional funding in the short term to enable us to keep the development and integration of our MoviePass business.'
Insider Take:
With new revenue streams in the works, MoviePass is no longer relying on but subscription income for its livelihood. This could assistance MoviePass become to a place of sustainability, simply the company has been so volatile, changing its pricing and/or business model every few months, that it is hard to envision long-term sustainability. The visitor's independent auditors even expressed 'substantial dubiety' that the company can keep going at this rate.
The company has grown its subscriber base quickly, but unless those subscribers are ownership subscriptions and non going to the movies, MoviePass volition lose money. How that model can work is a mystery. Information technology is also possible that MoviePass'southward ever-changing offers will put subscribers off. Instead of continuing to improve the offering, MoviePass subscriptions are like a moving target.
Source: https://www.subscriptioninsider.com/monetization/auto-renew-subscription/moviepass-changes-its-subscription-offeragain
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