Yes, you read that right and no, you are not seeing things.
MoviePass has lowkey been around since 2011, but according to new reports, Netflix cofounder Mitch Lowe is back with a new, controversial business model for his start-up—and movie lovers would be next to crazy to pass on it.
Since it first launched, MoviePass prices have ranged from $15-$50, depending on subscribers’ locations and the number of movies watched. Now, “For $9.95 a month, subscribers can see one movie a day in any US movie theater that accepts debit cards, with the exception of IMAX and 3D showings,” Business Insider reports. Talk about insane.
Still, somebody’s got to pay the full price for those overly expensive movie tickets. According to the report, MoviePass will pick up the tab, possibly at a loss. So, to fund and promote the rollout of his start-up’s low-price service, Lowe reportedly sold a majority stake to big data firm Helios and Matheson Analytics. In other words, expect to deal with a few invasive ads.
Unfortunately, a huge monetary loss and bad ads are not the only issue Lowe faces. According to CNET, MoviePass has beef with at least one movie theater chain. In a press release, CNET writes AMC Theaters confirmed “it doesn’t want to be part of MoviePass and is attempting to legally opt-out, saying it doesn’t believe the business model is sustainable for the movie industry.”
During his chat with Business Insider, Lowe had a compelling response to the chain’s skepticism: “What’s crazy about AMC’s statement is our customers go twice as often, spend 123 percent more on concessions each time — which is at least 80 percent margins for the theaters — and we pay full price,” he explained. It’s absolutely crazy to say, ‘We don’t want your money.’ We’re not asking for a discount, we’re not asking for a cut of revenue. We hope over the next couple of years we’ll show ourselves to be part of the movie entertainment ecocsystem… if we do that, then we want to sit down with the theaters, the studios, and figure out how we all can make more money.”
Read more on how CEO Lowe plans to make MoviePass work here and let us know if you’ll be signing up.