Moviepass made waves with their announcement at Sundance. Right after the event, subscribers found they could no longer use the service in select venues.
In a surprise announcement at the Sundance, MoviePass Ventures declared that they plan to co-acquire some indie movies. The first on their list is The Orchard's art heist drama American Animals. The deal reportedly cost $3 million and a significant P&A commitment from MoviePass.
On the heels of this seemingly good news, scores of subscribers found themselves unable to use their MoviePass card or app at select AMC venues. MoviePass did not issue a notice of this change.
Based on reports, major theaters are no longer from the list of participating venues. The MoviePass will not work at the AMC Century Plaza, and the Disney Springs at Walt Disney World in Florida, and the AMC Loews Boston Common 19. MoviePass stopped covering the Universal City Walk and Century City 15 in Los Angeles, Empire 25 in New York, and Loews Alderwood Mall 16 Lynwood in Washington, and River East 21 in Chicago too. MoviePass users took to Twitter to voice their grievances.
Some of our guests say MoviePass may be blocking the use of their service at a handful of AMC locations. AMC has not restricted MoviePass acceptance at our theatres, nor have we heard from MoviePass about this. MoviePass customers should contact MoviePass for clarification.
— AMC Guest Services (@AMCHelps) January 25, 2018
MoviePass seems to be the root of the problem, not AMC. Theaters listed in the MoviePass app accept the card which works like a Mastercard debit card. It seems that MoviePass will stop covering ticket prices at theaters with premium prices like the Empire 25. Notably, MoviePass already excluded Landmark Theaters, ArcLight Cinemas or iPic because of their expensive ticket price points from their list of partners.
"As of today, you'll find a small handful of theaters are no longer available on our platform. Our number one goal as a company is to provide an accessible price-point for people to enjoy films the way they're meant to be seen: on the big screen. Many exhibitors have been receptive to this mission, and we're excited to keep working with theater chains that are closely aligned with our customer service values," CEO Mitch Lowe said in a statement, in response to customer complaints on Twitter.
"As we continue to strive for mutually-beneficial relationships with theaters, the list of theaters we work with is subject to change. We advise customers to always double check the MoviePass app for the most up-to-date list of participating theaters," he advised.
The Real Problem
MoviePass currently covers more than $2M in weekly ticket sales to AMC alone. The company has had a problematic relationship with the theater chain, the biggest in the US, over the past few months. AMC initially refused MoviePass, even threatening legal action, before ultimately allowing the subscribers to use the cards in their theaters.
At the time that, AMC argued that MoviePass does not have a sustainable business model and that it would negatively affect the industry. The issue, from the theaters' point of view, is that if customers get used to paying subsidized rates, prices for tickets will gradually decrease.
Since MoviePass launched its subscription service has grown significantly in popularity. For just $9.95 per month, the service allows users to purchase a single movie ticket a day. It offers a cheaper rate compared to standard movie ticket prices across the country.
MoviePass pays the full ticket price to its theater partners. Since it subsidizes the subscribers' movie-going, the company stands to lose money every time someone uses the service. It didn't take a month for MoviePass to earn half a million sign-ups, and as of Jan. 9, MoviePass subscribers exceeded 1.5 million.