Was it a business, or a stock swindle, from the start? I recall seeing commentary that said "swindle" early on and i never saw anything to make me doubt it. I wonder who won, and how big?
The business model was flawed, in that they were over-optimistic about getting theater partners to buy in and sell discounted tickets to MoviePass. $10 for unlimited films anytime? Not going to work. But $15-18/month for unlimited matinees, or Mon-Thu, or any film 3+ weeks old? Those models are absolutely viable, and would provide revenue and attendance boosts for theater chains who partnered with MP.
Worth noting that AMC, the theater chain which was most vocal and aggressive in dismissing MoviePass, has seen its stock fall by 80% since early 2017 to an all-time low. CINE, an international conglomerate which owns Regal, is at a 5-year low.
Anecdote: I paid $18 for a single movie ticket (no peripherals) at an AMC not even two months ago. To be fair, the theater was packed so they must have been doing something right, but I couldn't believe the price increase even over the last year in movie ticket prices. I guess AMC's downfall strategy is similar to that of AT&T's.
Disagree - for one, see AMC's profit and revenue trends, easily summed up in the stark decline in the stock price. AMC's program is flawed in that it allows (encourages?) its members to use the theater's most valuable inventory, i.e. seeing Star Wars in 3-D or Dolby or IMAX on opening night. The people who joined likely made that decision based on the fact the the membership cost less than their typical ticket spend, thus it costs AMC in lost revenue. Plus the costs of advertising it, administering it, etc.
Movie theaters have never made much money from ticket sales. They make most of their money from concession sales and to a lesser extent advertising before the movie starts.
Also, for rev share purposes , they count each ticket sold via the subscription no matter what at $8.99
Ticket revenue is the majority of total revenue, while concessions have a much higher margin. For the last quarter with published results, AMC's gross profit on exhibition exceeded that of F&B. ==> http://investor.amctheatres.com/Cache/1001258324.PDF?O=PDF&T...
MoviePass sent additional people to the theater --> additional concession sales + additional ticket sales
AMC A-List customers occupy prime seats that would have likely been sold anyway --> no effect on concessions, reduced ticket revenue
Based on an average monthly frequency of 2.40x for our A-List members in the third quarter, their associated full-price bring-along guest attendance, their food and beverage spend and the price increases in the first quarter, we believe the A-List program was profitable in the third quarter and nine-months ended September 30, 2019 compared to our estimated results if the program had not existed. A-List membership levels continue to exceed our expectations despite our price increase and competitive offerings.
Lol, you've tried to defend AMC before on other threads. Read between the lines. "We believe" is about the lowest level of confidence one could attribute to a statement like this. No data, no methodology, no measurements. It's equivalent to "we hope" or "we guess" or "we really need this to be true."
The company's stock has fallen by 80+%. Management is under extraordinary pressure to defend their major decisions, including the rollout of A-List and the rejection of partnering with MoviePass. OF COURSE management is going to claim their decisions were correct, but they are offering ZERO hard data or evidence to that end.
"We believe" is AMC's hedge against actually lying. Maybe they do actually believe it. Irrelevant. Any 3rd party shouldn't believe it, certainly without any evidence.
2.4 visits isn't evidence. I believe the number, but it is meaningless on its own. How many of those tickets are for sold out shows? What pct are utilizing free upgrades (IMAX, Dolby, etc)? How much did these individuals spend prior to membership? What's the average concession spend vs non-members? What are the admin and advertising costs?
At 2.5 movies a month at $24/month, the ticket price is $9.60. A quick Google search shows that the average price of an IMAX ticket is $19.60
During the first two or three weeks, the distributor gets 70% of the ticket price. Worse case, if they see 2.5 IMAX movies on average, AMC would have lost $7.50 in gross profit from a stubs + user.
Since kids can’t get a subscription and a lot of the blockbusters are geared toward families, the kids would not only pay full price, they are also more likely to want concessions.
As far as the concession spend, its simple well known marketing psychology that when you get something for “free” you’re more likely to spend more when you get there. It’s an affect that has been seen with gift cards, Groupon deals, etc.
But when it comes to admin cost, ticket purchasing online and redemption via the handheld devices at the movie was pre-existing infrastructure they had before the Stubs+. How much harder do you think it really is to add logic to account for a stubs+ member is allowed three movies a week?
Also, they know the behavior of customers before and after they subscribed to Stubs A+.
They already had a stubs program where people ordered tickets online and they could track their behavior and changes in behavior after they subscribe. They also know how much they spend on concessions because most stubs members (not just stubs+ members) show their stubs QR code at the concession stand to get points toward discounts.
I signed up for 2 months in late 2018 and later tried to cancel, which was only handled by emailing their support team (no phone number, no cancel button on the website, no way to remove my billing details). I emailed them as instructed, but never got anything more than autoreplies from their ticketing system, and kept re-contacting them over the next 2 weeks, even from a separate email incase it was a problem on my end. They finally replied (once) after 2 weeks, and cancelled my account, but had already re-charged me in the meantime.
Thus, I contacted them again to remove the second charge, and never heard from them again. I had to resort to initiating a chargeback.
I knew they were a dead duck after that experience.
Sirius/XM has disgusting tactics, maybe not THAT bad, but I think it's part of their business model and it's been working for them for years. Although I question their longevity at some point.
I was always an avid movie-goer but the fact that movie tickets were $12-$14 was absurd. Any time I saw more than 1 movie per month I felt guilty for blowing so much cash at the theater. When MoviePass came along I saw around 30 movies in the course of a year. It was incredible. It gave me the oportunity to watch some new releases that I otherwise would not have considered watching at all. Some of those movies unexpectedly blew me away.
I appreciate what MoviePass did. They elevated the expactations of the average movie-goer when it came to ticket prices. They also created more opportunity for low-budget, foreign, and independent films to reach a wider audience. Of course $10/month for unlimited movies in the theater is not a sustainable business model. But now other theaters have similar subscription services (AMC's plan is ~$25/month plus concession discounts) which is still reasonable for a frequent movie-goer. MoviePass had a positive impact on the industry and hopefully the movie going experience will continue to improve as they continue to compete with streaming services.
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[ 0.19 ms ] story [ 59.3 ms ] threadWorth noting that AMC, the theater chain which was most vocal and aggressive in dismissing MoviePass, has seen its stock fall by 80% since early 2017 to an all-time low. CINE, an international conglomerate which owns Regal, is at a 5-year low.
Also, for rev share purposes , they count each ticket sold via the subscription no matter what at $8.99
MoviePass sent additional people to the theater --> additional concession sales + additional ticket sales
AMC A-List customers occupy prime seats that would have likely been sold anyway --> no effect on concessions, reduced ticket revenue
Based on an average monthly frequency of 2.40x for our A-List members in the third quarter, their associated full-price bring-along guest attendance, their food and beverage spend and the price increases in the first quarter, we believe the A-List program was profitable in the third quarter and nine-months ended September 30, 2019 compared to our estimated results if the program had not existed. A-List membership levels continue to exceed our expectations despite our price increase and competitive offerings.
The company's stock has fallen by 80+%. Management is under extraordinary pressure to defend their major decisions, including the rollout of A-List and the rejection of partnering with MoviePass. OF COURSE management is going to claim their decisions were correct, but they are offering ZERO hard data or evidence to that end.
But it’s amazing that you believe some numbers from AMC but not others from your same citations
Well, obviously Movie Pass didn’t have a great business model...
2.4 visits isn't evidence. I believe the number, but it is meaningless on its own. How many of those tickets are for sold out shows? What pct are utilizing free upgrades (IMAX, Dolby, etc)? How much did these individuals spend prior to membership? What's the average concession spend vs non-members? What are the admin and advertising costs?
During the first two or three weeks, the distributor gets 70% of the ticket price. Worse case, if they see 2.5 IMAX movies on average, AMC would have lost $7.50 in gross profit from a stubs + user.
Since kids can’t get a subscription and a lot of the blockbusters are geared toward families, the kids would not only pay full price, they are also more likely to want concessions.
As far as the concession spend, its simple well known marketing psychology that when you get something for “free” you’re more likely to spend more when you get there. It’s an affect that has been seen with gift cards, Groupon deals, etc.
But when it comes to admin cost, ticket purchasing online and redemption via the handheld devices at the movie was pre-existing infrastructure they had before the Stubs+. How much harder do you think it really is to add logic to account for a stubs+ member is allowed three movies a week?
Most of the advertising is done in the theatre.
They already had a stubs program where people ordered tickets online and they could track their behavior and changes in behavior after they subscribe. They also know how much they spend on concessions because most stubs members (not just stubs+ members) show their stubs QR code at the concession stand to get points toward discounts.
Thus, I contacted them again to remove the second charge, and never heard from them again. I had to resort to initiating a chargeback.
I knew they were a dead duck after that experience.
I appreciate what MoviePass did. They elevated the expactations of the average movie-goer when it came to ticket prices. They also created more opportunity for low-budget, foreign, and independent films to reach a wider audience. Of course $10/month for unlimited movies in the theater is not a sustainable business model. But now other theaters have similar subscription services (AMC's plan is ~$25/month plus concession discounts) which is still reasonable for a frequent movie-goer. MoviePass had a positive impact on the industry and hopefully the movie going experience will continue to improve as they continue to compete with streaming services.