Yesterday, MoviePass, a company that sells subscriptions that let customers see one movie per day in most theaters across the country, gained a lot of publicity by announcing that it was lowering the price of subscriptions to $10 per month. Someone wasn’t really a fan of this move, though: the country’s largest cinema chain, AMC.
“Not welcome”
Late on Wednesday, AMC made its view of MoviePass quite clear, announcing that MoviePass subscriptions are “not welcome,” and threatening legal action against the company. The MoviePass business plan, AMC argues, “is not in the best interest of moviegoers, movie theatres and movie studios.”
Having consumers get used to watching multiple first-run movies every month for 10 bucks “isn’t doing moviegoers any favors,” the chain argues, since consumers will only be set up for disappointment when the plan loses money and goes out of business.
AMC says that it is looking into its legal options to prevent MoviePass from being used at its theaters — and MoviePass CEO Mitch Lowe said that he’s concerned about this.
“What I’m worried about is it confusing customers and making them believe they can’t use this service at AMC theaters,” Lowe told Variety in an interview.
For now, they can… assuming that they’re able to access the MoviePass website to get a subscription. It’s been difficult to do so since yesterday’s announcement, since the site is slow to load and not always accepting new registrations.
Disputes between AMC and MoviePass are nothing new, though. The chain initially refused to take part in the original beta back in 2011, causing MoviePass to delay its launch. AMC later kicked around the idea of its own subscription program, partnering with MoviePass to test packages that started at $35 per month.
How is this thing supposed to work again?
With MoviePass, subscribers check in to the theater and showing using a mobile app, which preloads a debit card with the exact ticket price. Yes, this means that the company loses money if customers attend just one movie per month in most of the country, let alone the one per day that the pass entitles them to.
Some theaters don’t accept the passes, like art-house chain Landmark, but MoviePass claims that it can be used at 91% of theaters across the country for all movies except those shown on IMAX screens and/or in 3-D.
MoviePass is only locking in that $9.95 rate for the first year, and could raise it again after that. The company hopes to make money by boosting cinema attendance and concession sales, hoping that theaters kick some of those increased profits back to the subscription service. It could also subsidize the cost of tickets that customers actually buy by selling user data, showing highly targeted ads to its users, or simply by hoping that people forget to use their subscriptions for months at a time.
by Laura Northrup via Consumerist
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