REPORT: MoviePass Won’t Sell Tickets for ‘Christopher Robin,’ ‘The Meg’
The popular movie ticket subscription service, MoviePass, went through turmoil on Monday as the stock price of its parent company plummeted and a new report suggested that the service will not be offering tickets to upcoming major releases, Christopher Robin and the science fiction shark horror film, The Meg.
Massive ticket outages over the weekend left users who were trying to attend Mission Impossible: Fallout in a bind, which led the company to do an emergency high interest loan of $5 million to cover the company the weekend, but Monday found many users unable to find any screenings available for showings, leading observers to wonder whether they were watching MoviePass go under in real time.
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Ever since MoviePass went to their $10 a month service plan in 2017, skeptics have wondered how such a business model could survive, when the average movie ticket price in the United States is currently $9.16 and MoviePass originally offered unlimited movie tickets a month as part of their plan. In August of 2017, they changed their plan to limit users to one movie a day. In recent months, they have also introduced other limitations, with the most notable one being their version of Uber’s “surge pricing,” where they will charge a premium to users to see popular movies on their opening weekends.
Even with their surge pricing, they were still running at a loss on a robust 2018 summer movie season. For every movie that subscribers attend, MoviePass has to actively buy that ticket themselves from the movie theater in question. This led to a $45 million cash deficit in June of this year. However, the company continues to believe that the more subscribers that they add, the more able they will be to negotiate cheaper bulk rate purchases in the future.
Clearly, things were not working out the way that they expected over the weekend, as many users were unable to find available screenings for Mission Impossible: Fallout. MoviePass’ parent company, Helios & Matheson, saw its stock price plummet by over 60% on Monday, closing at under 80 cents on the Nasdaq Stock Market.
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The 80 cents figure is significant because if a stock trades at under $1 for more than a month, it can be de-listed from the Nasdaq, which would be a huge blow to the future of MoviePass, as not being listed on a major stock market greatly affects the company’s ability to raise capital.
A shocking report then followed late on Monday that MoviePass CEO Mitch Lowe held an all-hands meeting where he announced that MoviePass will not be offering tickets to Christopher Robin and The Meg, two major studio releases set to come out in the next couple of weeks. This seemed to also imply that the company plans to pivot from offering tickets to all movies and instead focus on tickets to independent films.
Many movie fans have grown to rely on MoviePass to see movies, so it will be quite a shock to these users to see the company change its practices so dramatically. However, it is still unsure if that is even the extent of the company’s future changes, as there is still a question of whether the company will continue period.
(Via Deadline)
