Netflix Co-Founder’s Next Disruptive Service Offers Daily Movie Tickets For $10 Per Month

Netflix Co-Founder’s Next Disruptive Service Offers Daily Movie Tickets For $10 Per Month
Delivery & Logistics

MoviePass allows subscribers to see movies in theaters for a low monthly fee, following in Netflix's footsteps

Matt Vitone
  • 17 august 2017

Netflix has more people watching movies and TV at home than ever before, but one of the company’s founders wants to get people off the couch and out the door to watch films the old-fashioned way: at the theater. Rich Lowe, Netflix co-founder and former president of Redbox, certainly knows a thing or two about upending the entertainment industry, and is looking to do it again with his latest venture, MoviePass.

Much like Netflix, MoviePass is a subscription service that lets customers watch a movie a day at a theater of their choice for just $9.95 per month. There are no blackout dates, and no contract is necessary. The only exceptions are 3D films, which are not included in the price of the package. The service is currently available in over 91% of U.S. theaters, including major players like AMC and Regal as well as smaller, independent locations.

MoviePass, which was founded in 2011, previously offered a tiered subscription model with plans ranging from $14.95 to as much as $50, but announced this week it would be overhauling its business model to introduce a cheaper price point. This will lose the company money, but executives say they plan to collect mass amounts of customer data which could eventually be used to target advertisements to subscribers and cut deals with movie theaters.

“This is about getting funded in order to launch our new price point,” the company’s CEO Mitch Lowe told Variety. “After years of studying and analysis we found that people want to go to the movies more often, but the pricing keeps going up, and that prevents them from going more. We’re making it more affordable for people.”

Unlike other disruptive subscription services (including Netflix), MoviePass could, in theory, actually help traditional players in the film industry, driving patrons to theaters to see the latest releases (good for film studios) while they use the money saved on tickets to buy concessions (the real money-maker for theaters). And just as Netflix has given general audiences greater access to foreign and independent productions, MoviePass could be a way for customers to try smaller, less-promoted movies risk-free without having to dole out for the price of admission.

In reality though, cinemas have done little to promote the service, favoring instead to build their own loyalty programs. Following MoviePass’ move to drop their price to $9.95, AMC threatened the company with a lawsuit on Wednesday, calling the subscription model “unsustainable” and claiming that it would reduce the quality and service theaters provided due to lost revenue.

The film industry, however, could certainly use the boost in attendance. The domestic box office is suffering from a slower-than-expected summer, with revenue year-to-date sagging 11% behind 2016. By the beginning of this month, the dearth of ticket sales had caused the top four U.S. cinema operators to lose $1.3 billion in market value.

MoviePass claims it boosts film attendance by 111%, and now with a more competitive pricing model, it’s in a position to grow those numbers even further. “We serve Millennials who have grown up with Netflix and other subscription models,” said Lowe. “They like that model.”

MoviePass


Lead Image: Jake Hills | Unsplash

Netflix has more people watching movies and TV at home than ever before, but one of the company’s founders wants to get people off the couch and out the door to watch films the old-fashioned way: at the theater. Rich Lowe, Netflix co-founder and former president of Redbox, certainly knows a thing or two about upending the entertainment industry, and is looking to do it again with his latest venture, MoviePass.

+Automotive
+Entertainment
+film industry
+home
+Millennials
+Movie Theaters
+movies
+Netflix
+Personalized Loyalty
+retail
+subscription service
+technology
+work

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