When MoviePass announced a $10/month subscription that lets you go to the theater every day, I signed up immediately. I knew it wouldn’t last, though. Less than a year later, the ride is already over.
I have a pretty strong love-hate relationship with MoviePass. I’m the kind of guy who loves going to movie theaters—noise, ads, and all!—and will almost never turn down an opportunity to see something new. In other words, the idea of MoviePass is perfect for me. Even if you go to the theater less than I do, I could (and did!) still make the argument that it’s worthwhile. After less than a year of policy changes, growing pains, and poor communication, I just can’t recommend it to anyone else anymore. And I’m probably going to cancel it myself.
The MoviePass Promise Was Incredible, But It Could Never Last
Just in case you’ve managed to miss the whole MoviePass thing, here are the basics: for years, MoviePass offered a subscription where you could pay in the area of $35 per month and go to the movie theater as often as you wanted. There were a few restrictions, but for some people it was a good deal. Depending on how much movies cost in your area, you had to go to the theater 2-3 times a month just to break even.
Then they dropped their price to $9.95 per month.
This was like breaking a dam. Suddenly customers came flooding in. After about six months the company went from having just a few thousand subscribers to over two million. And why wouldn’t they? $10 in some places is less than the cost of a single movie ticket. If you go to the movies once per month, you save money. Why wouldn’t you sign up?
The problem, naturally, is that this can’t be very profitable for MoviePass. The company pays movie theaters full price for tickets, so it loses a few dollars every single time people use its service. The company was only able to do this because they were purchased by analytics company Helios and Matheson, which gave them a huge reserve of cash to burn through. MoviePass claimed that between a combination of revenue sharing deals with movie theaters and valuable customer data, it could make enough money to turn a profit in a couple years and make up for essentially giving away movie tickets.
To put it simply, this is probably a crock. But, who cares? As a customer, I sure don’t. If the company goes out of business in a year, at least I saved a few bucks at the theater while it lasted. That was my argument when I wrote about it last year and it’s why I still use it today. Maybe the company will crash and burn. And maybe a gamma ray burst will suddenly destroy all life on Earth some day! There’s no point in worrying about it now as long, since we’re benefiting in the short term. Let MoviePass worry about its own business model while I save some cash.
That was a fine way to think, until the chaos around which MoviePass built its entire life started hitting customers.
It’s Hard to Scale With Customer Growth When You’re Losing Money
I was one of the first to sign up for MoviePass after it dropped its prices. I learned later that time period was a crap shoot as to whether or not you’d actually get your card. It took a few weeks for me to get mine, because of course it did. A company that was used to dealing with a few thousand people suddenly had to field requests for a physical card from hundreds of thousands of people. It was annoying, but expected.
That delay period lasted way too long, though. My colleague Chris requested a card on September 24th and only received it a month later. Thankfully, MoviePass didn’t charge users until the card was activated, but that’s still a long time to wait. According to a statement from MoviePass’s CEO in November—three months after the price drop—cards were finally shipping on time. Despite this, in January there were still reports of people who hadn’t gotten their cards, some from users who signed up in September.
The problems only got worse if anyone tried to contact customer service. Chris tried to request a refund after his MoviePass card—again, which he’d waited a month on—wouldn’t work at the theater. At the time, MoviePass had scrubbed its customer support phone number from its website, leaving only a chat system to interact with. Three months later, they finally responded about a refund. Another friend had a similar problem after being charged a yearly rate instead of monthly (but we’ll come back to that).
MoviePass’s customer support problem got so bad that on May 5th, we received a press release from the company announcing a new partnership with customer service company TaskUs. Not to get too inside-baseball here, but companies don’t tend to make big deals about building out customer service infrastructure unless they’ve already been screwing up in that area. It’s great that MoviePass is trying to improve in that area, but it can be a little worrying when a company is openly losing money and also has a clear problem with providing good customer service.
MoviePass Can’t Decide On a Business Model and It’s Hurting New Users
When I signed up for MoviePass, it was simple. I would be charged $9.95 per month. The end. Apparently, I was one of the lucky ones again. In the time since, MoviePass has tried to run a series of “promotions,” and changes to its pricing that make it even more confusing for new users. Moreover, it’s a worse deal.
First, in February, the company offered a bundle deal with streaming site Fandor. Now, MoviePass would be only $7.95 per month! Except, you would have to pay for a whole year up front. Oh, and there’s a $19.95 processing fee. But you get free access to Fandor, a rather eclectic movie streaming service. Frustratingly, these “promotions” aren’t really optional deals at all. When you sign up on their site, the deals are the only ones available. If you want the normal month-to-month plan, it’s difficult if not impossible to find it.
We’ll save you the trouble of doing math on that deal by the way: it’s not really worth it. For starters, that $20 processing fee wipes out almost all the savings. Twelve months of the normal MoviePass price is $119.40. Twelve months at $7.95, plus the processing fee is $115.35. If you pay up front for a year, you save four bucks. Not a great deal for a company that is losing money and, very possibly, might not exist in a year.
The company tried a milder version of this stunt again a month later, dropping its price to $6.95 per month, with a $6.55 processing fee. This comes out to a much more palatable $89.95 for the year, which at least saves you almost $30. However, you’re once again betting on the company still being around later. From a business standpoint, the benefit is clear. MoviePass gets money up front that you won’t spend until later, which helps keep them solvent. But when the bill comes due later, the fact that you’re benefiting from that deal could ultimately destroy the company that you just invested in. At least if MoviePass can’t find a way to stay afloat in the long-term. Either way, it’s just not a good idea for you to pay up front for a service like this.
The current deal is less of a gamble for both MoviePass and customers, but it’s still unnecessarily confusing and frustrating. Now, you can get the normal $9.95/month price, and you won’t be charged annually. Instead, you’ll be charged quarterly. So you’ll pay $30 up front and be locked in for the next three months. Oh, and there’s an iHeartRadio All Access subscription thrown in. Sure, whatever.
On top of this, the current plan isn’t technically unlimited anymore. Instead, you can see up to four movies per month. Frankly, this is fine. You already break even if you watch even one movie a month, and this limits the losses from the die-hard movie fans (like me) that bleed the company dry by seeing a movie every day. For most people, this is an acceptable limitation. It’s just really weird they didn’t try going with this from the start. Almost everyone would’ve been fine with it and MoviePass would be in a slightly better place financially.
Now, MoviePass Is Screwing Existing Customers
Funny story. I turned in a previous version of this article that ended right about here. MoviePass is chaotic, but they’ve got a solid deal of a product and even though new customers are getting jerked around, existing ones can at least enjoy the ride while it lasts.
Then, the ride stopped.
First, I got an email saying that I will now be required to take a photo of my ticket stub every time I go to the theater to prove I’m using it correctly. This is an expansion of a test program they implemented in early March. This is annoying because, frankly, it’s a hefty amount of paperwork to add to the experience to weed out the few people abusing the system. I want to watch a movie, not fill out an expense report. However, it’s not that bad and I was prepared to get over it.
Mere seconds later, however, I also received news that MoviePass would be rolling out a new limitation to existing users: you can only see a movie once. While existing users can still see a movie every day, they can’t see the same movie multiple times. If you watch A Quiet Place today, you’re going to have to pick something else to watch tomorrow. The old $35/month MoviePass had this limitation back in the old days and it was one of the things that turned me off to it. The lack of this limitation is part of what brought me back into the fold.
It’s not lost on me that I received this notification the day that Avengers: Infinity War came out. It is not hyperbole to say that this is one of the biggest movie events in recent history. There are no doubt those (myself included) who would have jumped at the chance to see this movie multiple times in theaters for the low, low price of $9.95. Despite the company’s lofty promise, there is simply no way they could afford this.
It makes sense from a business perspective. It’s still a gut-punch to people like me who signed up for one thing and now receive another. And it’s even worse for those people who were tricked into signing up for a year of the service. If you signed up last month for a year of MoviePass expecting to be able to rewatch movies as much as you want, you’re now stuck with a service that only lets you watch each movie once, and makes you file paperwork when you’re done. This is not how good companies run things.
I Can’t Recommend MoviePass Anymore, and I’ll Probably Cancel My Subscription
I took a chance on MoviePass because I didn’t mind if my card took a month to get to me and I go to the movies enough to make dealing with crappy customer service worth it. For a while, I recommended other people try it, too. The nihilistic optimist in me said it may die soon, but who cares if it’s fun for now?
Well, it’s not fun anymore. I could get past MoviePass trying to inflate its numbers to the movie industry to sound important or bickering with AMC over supporting a few locations as a power play in their negotiations. These are annoying but, for the most part, they don’t affect customers very much. I could even forgive their CEO accidentally wildly mis-stating how they deal with customer location data.
However, MoviePass has misled new customers about what kind of deal they’re getting. They’ve lost people in a customer service shuffle they were ill-equipped for. They shifted their business model repeatedly, making it difficult for even people like me who follow the news to know what’s going on. Then, to top it all off, they changed the terms right under users’ noses to deprive them of key benefits of the service right when customers would want it most.
This was all predictable. I can’t even really be mad about it because it was so painfully obvious it was going to go this way. For my part, I got my money’s worth out of the service while I had it. I definitely averaged more than one ticket per month, so all the frustration was worth it financially.
However, I’m very close to jumping ship. Less than a year in, the inevitable has happened: the free lunch stopped being free. The deal has been altered and I’m stuck praying it won’t be altered any further. Maybe some day MoviePass will become profitable and it won’t be a shaky, constantly shifting deal. Unfortunately, after MoviePass got a sudden influx of both cash and goodwill last year, it’s spent the last eight months burning through both.
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