MoviePass is losing money on basically every customer. Should you care?

The movie subscription service costs $9.95 a month, and lets you watch one movie in the theater every day. The problem here is obvious: two movie tickets are enough for MoviePass to lose money, and that’s before the cost of actually running the service.

RELATED: MoviePass Was a Great Deal, Now It's Trying Really Hard Not To Be

YouTuber Evan Puschak outlined this bizarre situation in a video last week, and it’s well worth viewing:

MoviePass’ strategy, such as it is, is to grow a massive userbase with low prices, then find a way to make money later. If that seems stupid to you I’ve got some bad news: the modern web is basically built on this strategy.

Sure: most sites aren’t charging $10 a month for nearly unlimited movie tickets. But plenty of services—including Trello, Dropbox, and Evernote— offer limited free versions that lose money in the hopes of finding a profitable group of users later.

Plenty of companies are burning money; MoviePass is just doing it faster. I’m not saying you shouldn’t use such services, but it’s worth thinking about—especially if you’d like the services you use to keep running.

Justin Pot Justin Pot
Justin Pot has been writing about technology for over a decade, with work appearing in Digital Trends, The Next Web, Lifehacker, MakeUseOf, and the Zapier Blog. He also runs the Hillsboro Signal, a volunteer-driven local news outlet he founded.
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