On the heels of touching a 1.5 million subscriber milestone and producing on a new sell honcho, the due busines for watching movies in theaters, MoviePass, today announced it’s going to start buying movies, extremely. The company says it will begin to invest in films in order to be allowed to share in their success beyond the box office, including on other platforms like streaming, DVD, and on-demand.
Essentially, the company is subsidizing the cost of its subscription with the capital it raised from data firm Helios and Matheson Analytics Inc.( HMNY ), now its majority owned. The plan is that MoviePass will operate in the red while growing its subscriber base, and then touched some kind of break even point in terms of revenue before the funding runs out.( Or perhaps HMNY is willing to keep piling on more money until that point arrives .)
HMNY believes it will eventually be able to sell the data and penetrations gained from a large subscriber locate to studios, who could then do targeted sell for their films to the most active movie-goers.
The model, of course, is risky. And theater owneds like AMC had now been lashed out against the service claiming its low-cost tickets are belittling the movie-going experience.
But perhaps MoviePass exactly witnessed a sweet recognise in terms of what a large number of consumers are willing to pay to actually go to the movies? After all, movie ticket prices have risen over the years, but attendance is hitting record lows. With all the other options to watch movies these days- not to mention the “peak TV” moment heralded in by the streaming epoch- these “in-the-theater-movies” face hard race for consumers’ term and money.
Still, MoviePass believes it has the power to boost theater appearance, so it may as well share in the upside of the films to which it sends all of these patrons; and that includes when those films start streaming across other programmes beyond the silver screen.
The company today claimed it can increase theater attending on request, in fact.
It says it currently buys about three percent of the domestic box office, but when it tweaked some things in its app- happenings it merely described as “a series of bars within its app and marketing-based platform”( uh-huh)- it could move the needle even further. It said it did this for The Post , i> Three Billboards Outside of Ebbing, Missouri , Call Me By Your Appoint and The Shape of Water. MoviePass says it impacted 10 percent of box office rendition for these movies.
We should note the company didn’t share specific data that would allow these figures to be fact-checked more thoroughly.
MoviePass is now at Sundance manufacturing the pitch that it’s ready to invest in films itself.
It will do so via MoviePass Ventures, a wholly-owned affiliate founded to co-acquire cinemas with movie distributors.
Basically, the idea here is that since it can( maybe !) boost the performance of a movie in the theatrical window, that they are able to impact the movie’s ability to generate revenue downstream- like when the digital copy goes on sale, or when it starts streaming.
And MoviePass craves a cut.
“We aren’t here at Sundance to compete with distributors, but rather to employ scalp in video games alongside them and to produce great films to the big screen across the country for our customers, ” said Ted Farnsworth, CEO of Helios and Matheson Analytics Inc ., in a statement. “We’re open for business. We’re now at Sundance- and SXSW is next.”