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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

#131

Post by jonny_eh »

anamexis wrote: post #128
stevewillows wrote: post #126

Earlier quoted context omitted.

This is sort of like Amazon's tactic with ebooks and such. Lose until your volume is high, then when you've cornered that particular market, negotiate a workable cost per unit. I really hope it works out -- but in all sincerity, I don't see why the theaters themselves aren't just copying this for their chains. MoviePass has already demonstrated the market.

Theaters are copying this for their chains - see Cinemark Movie Club and AMC Stubs A-List.

And to me that means Moviepass has done its job. I subscribed to the annual Moviepass plan, tried to use it last night (which failed, see article), so signed up for the Cinemark Movieclub, which lets me buy tickets online, and days in advance.

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

#132

Post by chaostheory »

MusaTheRedGuard wrote: post #51
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…

It's crazy. The data is basically worthless. I honestly don't know if they will survive for more than a few months. I was just thinking, what could they possibly do to survive as long as possible? They could introduce incentives to reduce the number of movies people saw a week? Maybe some kind of credit system, where customers built up points towards a premium membership. They could also start taking the most expensi…

> They could introduce incentives to reduce the number of movies people saw a week? They could also start taking the most expensive users of their platform

They've already done this. Just like unlimited data doesn't really mean unlimited. I guess they need to lower the thresh hold even more and affect more of their customers?

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

#133

Post by ascorbic »

stevewillows wrote: post #126
wildpeaks wrote: post #86

Earlier quoted context omitted.

The Nerdwriter has a good video (short, just 6 minutes) about it: https://www.youtube.com/watch?v=w876zZZIb10 The gist of it is, they're hoping to grow so big that movie theaters will have no choice but to negotiate with them, to share part of the revenues they bring theaters from people who normally don't come watch movies on a whim anymore.

This is sort of like Amazon's tactic with ebooks and such. Lose until your volume is high, then when you've cornered that particular market, negotiate a workable cost per unit. I really hope it works out -- but in all sincerity, I don't see why the theaters themselves aren't just copying this for their chains. MoviePass has already demonstrated the market.

They've done this in the UK for at least a decade. The two biggest chains each have an unlimited subscription service. They're both £18 though, so a lot more than moviepass

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

#134

Post by uxp100 »

scarface74 wrote: post #124
dwighttk wrote: post #123

Earlier quoted context omitted.

>it’s sustainable Is it? 3 movies/week for $20/month is about $1.67/ movie. I think it is just around until movie pass kicks the bucket (at least at that price)

AMC doesn’t show 12 different movies in a month. At most, they probably have a turnover of 5-6 movies per month. As I said earlier, the price they pay for the studio for each movie a subscriber sees is around $4-$6. They still make a lot of money on high priced concessions.

I looked at an AMC I've been to. They have 20 movies listed as available to see today. Many only have 2 showings or something, but they have 20 screens, they seem to turnover more than 5 or 6 movies in a month.

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

#135

Post by listenallyall »

scarface74 wrote: post #121
listenallyall wrote: post #92

If MoviePass fails, it's a failure of the Nash equilibrium due to stubbornness and lack of communication. MoviePass drives traffic to movies, benefiting both studios and theaters. Despite the existence of other subscription plans, if MP goes away, the majority of those tickets will never be purchased. MP could certainly have evolved into a sustainable plan, that restricted its users to seeing movies at off-times with…

AMC's subscription plan is especially attractive to high-volume users on which it will likely lose money, further, it encourages them to use their free tickets at peak times for the most popular movies in the most expensive formats. When an AMC subscriber in NYC reserves a seat for a Marvel film in IMAX on opening weekend, that's a $20+ ticket that AMC can't sell to a paying customer because the theater is sold out.…

The WSJ article says that's for standard 2D films. But A-List encourages subscribers to see 3-D, IMAX, Dolby, etc. It also says the studios aren't on board with the $8.99 figure and are seeking changes in AMC's calculations.

https://www.bizjournals.com/losangeles/news/2018/06/25/amc-s... https://www.wsj.com/articles/hollywood-studios-fear-amcs-new...

The studios are not going to sit back and accept just $5 per admission to Black Panther on 3-D IMAX on Saturday night of opening weekend, when that ticket retails for $18-25 (depending on location). Studios usually collect 80-90% of ticket revenue for big movies on opening weekend.

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

#136

Post by citrablue »

acchow wrote: post #111
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! It worked for Uber tho. And now they've raised prices in markets where they are established.

Uber also plans to cut costs significantly in the future w/ autonomous cars. May be a pipe dream, but if they believe in the successful widespread deployment of the technology, that means they just have to stay afloat until then.

MoviePass could start to make their own movies, but that would require a substantial investment and isn't really comparable

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

#137

Post by 794CD01 »

stevewillows wrote: post #126
wildpeaks wrote: post #86

Earlier quoted context omitted.

The Nerdwriter has a good video (short, just 6 minutes) about it: https://www.youtube.com/watch?v=w876zZZIb10 The gist of it is, they're hoping to grow so big that movie theaters will have no choice but to negotiate with them, to share part of the revenues they bring theaters from people who normally don't come watch movies on a whim anymore.

This is sort of like Amazon's tactic with ebooks and such. Lose until your volume is high, then when you've cornered that particular market, negotiate a workable cost per unit. I really hope it works out -- but in all sincerity, I don't see why the theaters themselves aren't just copying this for their chains. MoviePass has already demonstrated the market.

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.

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

#138

Post by sf_rob »

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!"

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

#139

Post by raisedbyninjas »

clintonb wrote: post #30
s73v3r_ wrote: post #23

Earlier quoted context omitted.

They already do strongarm some smaller theaters into getting a cut of concessions.

What leverage do they have to strongarm? If a theater is popular, that means MoviePass customers like the theater. MoviePass needs the theater more than the theater needs MoviePass. If MoviePass chooses not to pay for tickets at the theater, that’s a MoviePass problem.

Anecdotally 30-50% of Studio Movie Grill (southern chain of dine & drink theaters) patrons are Moviepass subscribers. The food and drinks are their primary profit centers to the point that they often don't even bother with ticket monkeys. If Moviepass interrupts that stream of customers, the theater starts losing out on sellout showings nearly everybody is purchasing a meal and drinks.

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

#140

Post by jacobush »

citrablue wrote: post #136
acchow wrote: post #111

Earlier quoted context omitted.

> You can't charge less than the marginal cost, it doesn't make sense! It worked for Uber tho. And now they've raised prices in markets where they are established.

Uber also plans to cut costs significantly in the future w/ autonomous cars. May be a pipe dream, but if they believe in the successful widespread deployment of the technology, that means they just have to stay afloat until then. MoviePass could start to make their own movies, but that would require a substantial investment and isn't really comparable

Wow that would be something...

what would happen if Universal Pictures stepped in with a subscription model (or whatever Moviepass does) for their movies?

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