If the Greek myth of Icarus were written in 2018, it probably would have been about MoviePass.
Yes, the service has ballooned to about 3 million subscribers, which certainly sounds like success — especially since Helios and Matheson has suggested it will become profitable at about 5 million subscribers. But the company doesn’t appear to have enough money to pay for all of its subscribers’ movie tickets, to the point that pundits are predicting the company could shutter its doors within a week.
MoviePass, meanwhile, announced Monday that it is raising the price of its standard subscription from $9.95 to $14.95 and limiting availability to movies that open on more than 1,000 screens. (The company did not explain exactly what this limitation was, and it declined The Post’s request for comment.)
So what’s the big deal with MoviePass, anyway? And how did we get here?
The service began innocuously enough, chugging along for six years before the public took notice. It was a subscription movie service, meaning that for a monthly fee, users could see a set amount of movies in major theaters. The price and number of movies changed throughout those years.
Then, in June 2016, Lowe — touting his role as a Netflix co-founder — took over as CEO and made two monumental changes:
- Lowered the price to $9.95 per month, or $6.95 per month if you purchased a year-long subscription. (It had been $50 a month at its highest.)
- Raised the number of movies users could see to one a day.
MoviePass exploded. Despite the service being riddled with technical difficulties — one personal example: It took more than two months for my account to be activated, even though I had paid in full — users were generally ecstatic.
Theater chains felt differently, even though MoviePass fully paid for each ticket. AMC released a press release bluntly titled: “‘AMC Theatres Statement about MoviePass Announcement: ‘Not Welcome Here.’ ”
“From what we can tell, by definition and absent some other form of other compensation, MoviePass will be losing money on every subscriber seeing two movies or more in a month,” the release stated, adding, “AMC noted that it is not yet known how to turn lead into gold.”
AMC wasn’t the only one wondering how the service would make money. Many thought MoviePass was following the gym model — get users to pay a monthly fee in hopes that they wouldn’t use it. But the company said it was in the data business, collecting information on its users to potentially sell to studios.
That argument seemed flawed when it dropped access to some of the most-trafficked AMC theaters. But that didn’t really seem to matter. The service continued enticing both casual moviegoers and modern-day Binx Bollings, proving to be such a good deal that even obvious privacy concerns didn’t turn anyone away.
Those concerns only grew as Lowe spewed some pretty Orwellian rhetoric — such as when he announced the company can track users’ phones using GPS.
“We watch how you drive from home to the movies,” he once said. “We watch where you go afterward.”
Users stuck around anyway. More, in fact, flocked to it. But despite the service’s growing base — and, in addition, because of the service’s growing base — cracks in the company’s model were becoming too obvious to ignore.
By April, panic was in the air.
The many changes that MoviePass implemented — such as disallowing people from seeing the same movie twice, toying with raising prices and forcing moviegoers to photograph their ticket stubs — began irking users and caused media outlets to predict its seemingly inevitable downfall. The Verge said the service “is no longer too good to be true.”
“If you’re using the service — or thinking about signing up — you should probably get the most out of its too-good-to-be-true offer before it’s too late,” warned Lifehacker.
Meanwhile, words such as “scam” began to pop up on social media.
“It’s been 3 days and you guys still have not addressed the reason why you changed the terms & conditions. I paid $100+ in advance for a year of unlimited and now I can’t see the same movie. #scam #moviepass #baitandswitch,” one Twitter user wrote.
“Hey @MoviePass I paid for a year for a product that allowed me to see a movie once a day. I paid for this before you changed your terms. I need you to hold up your bargain until my subscription ends. Then I will decide if I want to renew with new terms. #scam #moviepass,” wrote another.
Things have only gotten worse. The service was unavailable to most users last Thursday, and the company was forced to take out a $5 million loan — essentially to keep the lights on. Helios and Matheson’s stock dropped by 40 percent on Monday.
Perhaps most damaging of all, many of its 3 million users don’t even seem fed up any more. They’re just making jokes at this point, the band playing as the Titanic sinks.
RIP to MoviePass, a great socialist scheme accidentally implemented by very confused capitalists— Zach Schonfeld (@zzzzaaaacccchhh) July 30, 2018
Many outlets have declared this the end of the service, despite its last-minute Hail Mary attempt of raising prices and limiting movies — the exact opposite of Lowe’s original move that made it so popular.
Even if it dies, though, MoviePass’s spirit might live on. Rob Harvilla argued in the Ringer that it’s “entirely possible that despite all the tech-support catastrophes and PR debacles, MoviePass has revolutionized the way we go to the movies and ensured that five years from now, we’ll still be going to the movies at all.”
He might be onto something. After all that grandstanding, AMC recently announced its own subscription program, AMC Stubs A-List, which allows users to see three movies a week for $19.95 a month — including 3-D, Imax and repeat viewings, all of which MoviePass disallowed. It might not be as good a deal, but it seems a heck of a lot more sustainable.
And, who knows, maybe MoviePass will survive this latest PR wreckage. But it seems unlikely.
It “may seem like it’s a deal too good to be true,” Lowe once said. “That’s what they said about us at Netflix. That’s what they said about us at Redbox.”
And he’s right: Those services worked. But this time, perhaps he flew too close to the sun.