Sundance: MoviePass Announces It Will Acquire Films
MoviePass must have some serious Netflix envy.
The subscription service isn’t just content offering customers bargain-basement tickets to movies. Like the streaming service it is most often compared to, MoviePass is diving into the content business.
Using the Sundance Film Festival as a platform, MoviePass announced that it was creating a subsidiary, dubbed MoviePass Ventures, and will co-acquire films with film distributors. Details are a bit vague, but MoviePass said it plans to release films across other platforms, including streaming, DVD, and on-demand. The service is at Sundance hosting an all-day pitch to indie players that will include panels with the likes of Elijah Wood, producers Daniel Noah and Lisa Whalen, and MoviePass CEO Mitch Lowe.
Lowe took over at MoviePass in 2016 after stints at Netflix and Redbox. The company had struggled for years to popularize its monthly subscriptions, but after being purchased by data analytics firm Helios and Matheson, it picked up steam with a new, low-cost offering. MoviePass slashed prices from roughly $50 a month to $9.95. Since that time, more than 1.5 million people have signed up for the service. In 2016, before it announced the new pricing plan, it had 20,000 subscribers.
Despite its success in attracting customers, MoviePass faces a lot of skepticism about its business model. Major theater chains such as AMC have been scalding in their criticism of their service, publicly predicting its demise. And, it must be said, MoviePass is currently a money-losing proposition. The service heavily subsidizes the tickets of its customers. It pays full price to theaters (tickets in markets like New York and Los Angeles routinely top $15), and hopes that either the data it collects on its customers or the market share it commands will give it leverage with studios and exhibitors. In essence, the company hopes that it will become such a valuable part of the movie-going ecosystem that other stake holders will either offer it cheaper tickets or will buy the information it collects.
Earlier this week, MoviePass announced it was hiring Natasha Mulla as chief marketing officer and was specifically tasking her with enlisting customers in markets such as Dallas and Nashville, where tickets are cheaper as a way to offset its customers in higher-cost markets.
In a statement announcing MoviePass’ move into distribution, Lowe said MoviePass has helped bolster the box office for films and wants to get in on the profits.
“It’s only natural for us to double down and want to play alongside [distributors] — and share in the upside,” he said.
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