You might remember the original MoviePass, the popular movie ticket subscription service that shuttered dramatically in 2019 amidst multiple scandals.
But are you ready for the sequel?
Insider reported Thursday that the company’s co-founder, Stacy Spikes, regained ownership of MoviePass this week, paying an undisclosed sum to buy it out of bankruptcy. To recap how it got there: The service originally launched under Spikes a decade ago, offering customers the chance to check out multiple movies in theaters every month for a set price. The company’s first foray into this model offered unlimited movies each month for $50, CNET says, but it soon switched to a sliding scale of cost tailored to location (between $24.99 and $39.99 per month). Then, in 2017, Helios and Matheson Analytics purchased a majority stake in the company and shifted its business model to a lower, flat fee of $10 a month to access one movie per day. In some markets, such as New York City, that was cheaper than the cost of paying for one regular movie ticket.
By 2018, Spikes had been fired, and subscriptions had surged from tens of thousands to 3 million, according to Insider.
But the model proved unsustainable, and the company publicly struggled to stay financially afloat. According to The Verge, hopes of partnering with theaters to get a cut of their funds fell flat, leaving MoviePass losing money on “virtually every customer.” An investigation from the Federal Trade Commission (FTC) later found that the company attempted to prevent customers from going to the movies to try to stem this loss, with the federal agency referring to MoviePass’ model as a “double feature of deception.” The “roadblock” tactics in question included invalidating the passwords of thousands of the most active subscribers, falsely alleging there had been “suspicious activity or potential fraud.”
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MoviePass settled with the FTC this summer, a year after declaring bankruptcy and two years after shutting down its subscription service. Its storied downfall has since become the stuff of entertainment itself, with Deadline announcing earlier this year that Mark Wahlberg’s production company is working on a docu-series about it.
Spikes maintains that the fundamental idea behind the business was sound, though, saying in a statement to Insider: “We are thrilled to have it back and are exploring the possibility of relaunching soon. Our pursuit to reclaim the brand was encouraged by the continued interest from the moviegoing community. We believe, if done properly, theatrical subscription can play an instrumental role in lifting moviegoing attendance to new heights.”
The movie landscape MoviePass is looking to return to is quite different than that of 2011, of course, with in-person movie viewing still yet to recover from pre-pandemic times. There’s also the incredible rise of streaming services to consider. And, as Engadget notes, multiple movie theaters like Regal Cinemas, AMC and Alamo Drafthouse have since launched their own subscription services, potentially complicating MoviePass’ access to those chains.
Still, for those who are interested in checking out MoviePass’ next act, you can sign up to receive email updates from the company’s new website.
Source : Popular Science