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MoviePass couldn’t afford to pay for movie tickets on Thursday

money.cnn.com

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Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#261

Post by blueboo »

reaperducer wrote: post #143
legitster wrote: post #20

If I am a traditional 'tech' company - I can afford to lose money when I am investing it in my platform or technology. It's like borrowing money to invest in your assets. For MoviePass, they are losing money and passing it off to theaters - it's like borrowing money to buy more ingredients for a failing restaurant. You can't charge less than the marginal cost, it doesn't make sense! I am trying to wrap my head around…

An emergency loan with no change to the service whatsoever? They are really having a deer in the headlights moment. Reminds me of a startup I worked with once. The goal wasn't to make a viable product. It was to make a big splash and get bought. 10 Start a product/service 20 Make a big hype and get lots of publicity 30 Get bought by some larger company that sees you as a threat/opportunity 40 Founders get big cash pa…

"A startup I worked with once"?! That's the dominant start-up model.

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#262

Post by speby »

sf_rob wrote: post #138
legitster wrote: post #20

If I am a traditional 'tech' company - I can afford to lose money when I am investing it in my platform or technology. It's like borrowing money to invest in your assets. For MoviePass, they are losing money and passing it off to theaters - it's like borrowing money to buy more ingredients for a failing restaurant. You can't charge less than the marginal cost, it doesn't make sense! I am trying to wrap my head around…

>You can't charge less than the marginal cost, it doesn't make sense! The old joke is "Sure we have marginal losses, but we'll make up for it with volume!"

Right, the old "Let's sell $1 bills for $0.99!" Make up the loss with volume! =)

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#263

Post by jsjohnst »

15155 wrote: post #236
794CD01 wrote: post #137

Earlier quoted context omitted.

I don't see how it makes sense to copy a strategy that loses money when someone else is already following that strategy and going broke due to all the money they're paying you.

The strategy only loses money because they are paying full-retail price for movie tickets. AMC's A-List (costs $19.99) does not pay $9-$13 per showing a la MoviePass. They pay the same space/personnel costs per seat they always have. Tickets have never been a theater's largest or most desirable source of revenue.

It was my understanding the ticket price basically covered the film licensing cost, the movie theater made basically zero profit of that. They make their profits off concessions. I don’t know if that’s true still or not, but used to be the case.

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#264

Post by gwbas1c »

rtkwe wrote: post #214
sf_rob wrote: post #138

Earlier quoted context omitted.

>You can't charge less than the marginal cost, it doesn't make sense! The old joke is "Sure we have marginal losses, but we'll make up for it with volume!"

I mean the plan seems to be that except the marginal losses are supposed to go down as they reach higher volumes. Attract the heavy movie goers first and lose money on them till you can attract enough light movie goers that will buy this and forget about so you can afford the people seeing more than 2 movies a month. There's other ways to drop that marginal cost like getting deals from theaters on tickets for bringin…

Exactly. Most people aren't stupid enough to sign up for things they won't use.

The subscription model where you assume your customers just forget to unsubscribe will never go anywhere.

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#265

Post by gwbas1c »

gambiting wrote: post #33

They still keep thinking that people will eventually treat it like they do gym memberships - buy them, but ultimately not use them. But there is a certain social expectation to have a gym membership and at least pretend you are doing something about your physical fitness. I have one through work and the last time I've been to that gym was over a year ago. But I can't be bothered to go to HR and actually cancel my acc…

A movie ticket doesn't cost that much... If you only go to the movies a few times a year, a subscription is an obvious gimmick.

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#266

Post by jamaicahest »

ironjunkie wrote: post #158
reaperducer wrote: post #143

Earlier quoted context omitted.

An emergency loan with no change to the service whatsoever? They are really having a deer in the headlights moment. Reminds me of a startup I worked with once. The goal wasn't to make a viable product. It was to make a big splash and get bought. 10 Start a product/service 20 Make a big hype and get lots of publicity 30 Get bought by some larger company that sees you as a threat/opportunity 40 Founders get big cash pa…

This unfortunately is probably the untold goal of 80% of startups around the Bay area that have unsustainable business models. What I find ethically borderline is that no founders will admit this, they will all pretend their goal is to make it a super successful sustainable company. As you said, the issue is that founders will usually get a moderate payout (a couple Million$), while even early employees will get almo…

>As you said, the issue is that founders will usually get a moderate payout (a couple Million$), while even early employees will get almost nothing.

How is that an issue? To quote Robert T. Kiyosaki's book "Rich Dad's Cashflow Quadrant: Rich Dad's Guide to Financial Freedom": "Your boss' job is not to make you rich. Your boss' job is to make sure you get your paycheck. It's your job to become rich if you want to."

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#267

Post by gambiting »

gwbas1c wrote: post #265
gambiting wrote: post #33

They still keep thinking that people will eventually treat it like they do gym memberships - buy them, but ultimately not use them. But there is a certain social expectation to have a gym membership and at least pretend you are doing something about your physical fitness. I have one through work and the last time I've been to that gym was over a year ago. But I can't be bothered to go to HR and actually cancel my acc…

A movie ticket doesn't cost that much... If you only go to the movies a few times a year, a subscription is an obvious gimmick.

I disagree....where I am from(UK) the cinema is so incredibly expensive that I pretty much only see movies that I know I will like(big blockbusters) because I cannot risk spending £16 on a ticket and not linking the movie. And yes, you can sometimes buy tickets for £6-7, but that's usually only on specific days and times, which doesn't always work for me. Regular cinema is incredibly expensive.

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#268

Post by jfim »

gwbas1c wrote: post #264
rtkwe wrote: post #214

Earlier quoted context omitted.

I mean the plan seems to be that except the marginal losses are supposed to go down as they reach higher volumes. Attract the heavy movie goers first and lose money on them till you can attract enough light movie goers that will buy this and forget about so you can afford the people seeing more than 2 movies a month. There's other ways to drop that marginal cost like getting deals from theaters on tickets for bringin…

Exactly. Most people aren't stupid enough to sign up for things they won't use. The subscription model where you assume your customers just forget to unsubscribe will never go anywhere.

> Most people aren't stupid enough to sign up for things they won't use.

That's the gym model, sign up people in January for a yearly gym membership, have 90% of those people not visit past the end of the month.

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#269

Post by scarface74 »

listenallyall wrote: post #222
scarface74 wrote: post #144

Earlier quoted context omitted.

I can’t find the numbers now, but Imax did make some kind of deal with AMC. https://deadline.com/2018/06/imax-approves-amc-theaters-new-... By “wouldn’t affect the overall economics”, I assume they meant that AMC promised them that the offset in revenue would be made up by the number of people seeing IMAX or they would make up the difference. Not they are paying full cost.

Of course IMAX is on board with AMC's plan. IMAX was one party that was credibly threatened by MoviePass, since MP customers were prevented from purchasing IMAX tickets. MP customers will see Mission Impossible tonight in normal 2D for free, reducing the demand for IMAX. AMC completely flips the script. Its members can see IMAX films without any premium cost, even on opening weekend. Regular screen, or 3D IMAX for th…

The best I can infer, is that simplistically the deal will be if they expected to make $X from IMAX based on Y people showing up before the subscription, as long as they make at least $X or slightly more than $X, IMAX will be happy with the decreased cost per ticket.

Re: MoviePass couldn’t afford to pay for movie tickets on Thursday

#270

Post by idontpost »

rtkwe wrote: post #260
ams6110 wrote: post #227

Earlier quoted context omitted.

That might have worked before Netflix and Amazon Prime and other online movie services. The light movie goers are all online now. Only the heavy duty die-hards are still going to theaters to see first-run films. I haven't gone to a theater movie in over three years.

The never ending stream of largest box office takes makes that seem unlikely. Seems there's still a pretty strong desire for blockbusters and kids movies.

Ticket prices keep going up too.
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