Why MoviePass is A Genius Way to Get People Back into Theaters, and Why AMC Should Be Embracing It

MoviePass

In the past week, there’s been a lot of talk about MoviePass, its sale to Helios and Matheson Analytics, and their decision to lower subscribers’ monthly rate to $9.99 from the nearly $50 members were paying previously.

What you might not have read this past week were thoughts from someone who actually has been using Moviepass for over a year at the higher rate, and who has been talking up Moviepass to all of my movie-loving friends, who were always skeptical of it. Mind you, I had been paying $50 a month, realizing I only needed to see four or five a month to make it a worthwhile deal, and I had the time and inclination to go see movies in theaters using my card.

When you live in New York City, going to see a movie is a costly affair, because very few movie houses in the city are charging less than $15 per ticket. Casual moviegoing has become a thing of the past because no one wants to waste their hard-earned money to watch a bad or unentertaining movie.

I jumped onto MoviePass when I learned that the brand-new arthouse theater that opened a block away from me would accept the card. The thought of being able to see all sorts of old movies I might not have seen otherwise was very appealing. MoviePass made that happen, and the number of movies I’ve seen in the past year using the card is well into the hundreds. The amount of money I’ve saved is probably close to $1,000 or more.

Reducing the monthly price was nothing short of genius because other attempts to get new members just weren’t working. Previously, MoviePass had tried to entice new members with a 20% discount on the monthly rate and were even going to offer a Groupon to get new members on board, something they no longer need to do.

More important than anything else, MoviePass is looking to compete with Netflix by getting people out of their houses and off their devices and into theaters.  I know from my own  firsthand experience that it works.

There are some conditions involved, but once you get acclimated to them, it’s as simple as going to a movie theater, signing into MoviePass’ APP on your iPhone or Android device, then when  the clerk or ticket machine asks for payment, you just swipe your MoviePass card. That’s it.

Except for a handful of New York theaters, I was able to use MoviePass just about anywhere that plays movies from the bigger multiplexes in Times Square to the tiniest of arthouses downtown.

The most surprising thing to come out of MoviePass’ deal and the decision to lower the monthly rate is that AMC Entertainment, the country’s largest theater chain, almost immediately reacted by trying to block the use of MoviePass at their theaters. Mind you, having more people going to see movies at their theaters should be the first thing any executive at AMC should be praising and embracing. In fact, theater owners like AMC should be absolutely thrilled by a company who is ready to put their money where their mouth is in order to get more people into theaters. The fact it’s a company founded by a Netflix co-founder is nothing short of astounding.

Instead, there was a lot of doom and gloom about how this plan could never work and was destined to fail, and anyone who buys is was bound to be disappointed. Sure, if you crunch the numbers to where MoviePass might be paying out $300 to 500 for each member that only pays $10 a month, you would definitely wonder, “How can this possibly be profitable for MoviePass?”

Well, it works in a similar way as Netflix did back when it was solely a DVD rental house and even now as  it continues in its current configuration. Everyone will be paying the same $9.99 a month for MoviePass, and while some might take advantage of its benefits and actually see one movie a day every month, those people are going to be few and far between. Most people will probably still use their Moviepass to see maybe one or two movies a week and some people will use it even less.

When the price for MoviePass was $50 a month, it felt necessary to go see at least four movies a month using Moviepass to make it worthwhile. Now that it’s $10 a month, there will be people who are just happy they have it so that if they do have time to go to the movies, they can use it. The people who are only using their MoviePass once a month or maybe not at all, will be covering the expense of those who go crazy and see a movie every day. Other than fellow film critics, there are very few people I know who could stand seeing one movie every single day.

I want to go back to the Netflix DVD rental model for a second, because I was a very early member of that service as well, and what would happen was that I’d be able to rent two DVDs at a time and do that as often as I could watch the movies, mail them back in and receive two more. Some people really took advantage of this easier way to rent DVDs, quickly watching their rentals and turning them around to get more.

Me? I basically would rent DVDs and they would sit next to my television set for weeks, even months, while I paid the $8 a month for them to sit there. I figure there were some movies that would have been cheaper to buy considering how long it took for me to get around to watch them. If I didn’t watch a rental DVD for six months — and this happened — then I was paying $56 to rent a single movie. I was the perfect Netflix customer, and the same will be true for MoviePass.

There will be many people, maybe even thousands, who jump onto MoviePass with the new discounted rate and might not use their MoviePass card for months at a time while still paying the $10, just to have it in case they need it.

It works a little bit like health insurance where the healthy people with jobs that offer insurance are paying a certain amount a month just to make sure they have coverage in case they get ill or injured. They’re the ones who keep the insurance company from going out of business when one of their customers gets cancer or a similarly debilitating and costly illness.

Sure, it might be strange or even blasphemous to compare MoviePass, something few people actually need, to health insurance, but how many people pay for a monthly subscription to Netflix and never get around to watching anything for months? I would think it’s a fairly large percentage, but that’s just the way the world works these days where consumers feel they need to have something everyone else has, even if they don’t use it very much.

MoviePass will work effectively at getting people back into theaters to see movies rather than waiting for streaming or DVD, which right now is crucial when we’re coming off a summer box office that’s at its lowest in years.

 Edward Douglas | East Coast Editor