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Helios and Matheson

CNN Media: MoviePass continues its rapid rise as it surpasses two million subscribers

MoviePass is not slowing down.

The $10 a month unlimited movie service just crossed two million subscribers less than one month after passing 1.5 million users, the company announced on Thursday. 

"We're giving people a reason to go back to the movie theaters and they're going in droves," CEO Mitch Lowe said in statement. "With awards season here, we hope we can make Hollywood and exhibitors very happy by filling seats with eager audiences." 

Thursday's announcement did not include any information on how many subscribers are actually using the service to watch movies. CNN has reached out to MoviePass for further details. 

Ted Farnsworth, the chairman and CEO of MoviePass' majority owner and analytics firm Helios and Matheson, said that the service is bringing people back to theaters by "lowering their cost," which the company believes is "transformational for the industry." 

The data the company collects from these two million movie-goers "will become an important asset to our partners and the future of the movie industry," Farnsworth said. 

MoviePass has been the talk of Hollywood and movie-goers since it lowered its subscription fee to $9.95 a month in August, setting off its tremendous growth rate. 

Lowe told CNN last month that the company is buying one in every 35 tickets sold in the country. He also said that the company is playing catch up to its own growth by investing in areas like its unstable MoviePass app and its unreliable customer service. 

Related: MoviePass CEO: $10 unlimited movie service is playing catch up to its own growth

Despite its successful rise, the service has found itself in a contentious relationship with mega movie chains like AMC while also answering questions about just how viable its business plan is. MoviePass sells its user data to third parties to make money. 

"Our service is really low because we are going to use our understanding of you as a customer to be able to give you relevant suggestions that you might find valuable in your life," Lowe told CNN last month. "We might say there's a great restaurant across the street from the movie. If you go over there and show them your card, you're going to get a free appetizer."

Wired: HOW DOES MOVIEPASS MAKE MONEY? WE'RE STARTING TO FIND OUT

MoviePass has pulled support from some AMC theaters, just one of many signs it's finally serious about making money.  PATRICK T. FALLON/BLOOMBERG/GETTY IMAGES

MoviePass has pulled support from some AMC theaters, just one of many signs it's finally serious about making money.

PATRICK T. FALLON/BLOOMBERG/GETTY IMAGES

WHEN MOVIEPASS LAUNCHED last summer, it introduced a seemingly impossible offer: See a movie every single day in theaters, paying only a monthly fee that, in most markets, amounts to less than a single ticket. It worked. Earlier this month, MoviePass hit 1.5 million subscribers, growing much faster than anyone expected, including MoviePass.

But amassing customers was never going to be the hard part. MoviePass now has to show that it can actually, you know, make money. A little less than six months in, it looks as though it just might have an answer—although a fresh spat with AMC shows that not everyone will like it.

Giving It Away

To be absolutely clear: The more subscribers MoviePass signs up, the more money it loses. It pays theaters full price for each ticket, whether a member visits once or 31 times a month. It has to provide for customer service to support those 1.5 million people, many of whom have lobbed valid complaints—MoviePass issues debit cards to each of its members, and initially couldn't keep up with demand—as the service struggled with its rapid expansion. And that’s on top of the usual, unglamorous costs of running any business. (Backends don’t maintain themselves.) If it seems like MoviePass is too good to be true, that’s because right now, it is.

Which is also why its explosive growth hasn’t been an unvarnished good, at least in the short term. “It’s harder in some respects and easier in others,” says MoviePass CEO Mitch Lowe, who cites the company’s customer service falterings as a primary drawback. There’s also the matter of all the cash the company must have run through by now; Helios and Matheson, an analytics company which has a majority stake in MoviePass, continues to put millions toward keeping the company afloat through the outflow. Analyst Brian Kintsligner of Maxim Group recently wrotethat the company had "an estimated seven months of cash" to cover losses incurred by heavy-usage members.

The question, then, might not be whether MoviePass has a long-term plan for success—it's if the company can stick around long enough to see it through.

Read more here

The Verge: MoviePass pulls support from popular AMC theaters

MoviePass and the AMC Theatres chain have never exactly enjoyed a rosy relationship, and the latest step in their conflict came today, as MoviePass pulled support from some of the chain’s most high-profile locations. Deadline reports that the service is no longer supporting ticket purchases at theaters like the AMC Empire 25 in New York, Universal City Walk near Los Angeles, and the AMC Loews Boston Common.

“As of today, you’ll find a small handful of theaters are no longer available on our platform,” MoviePass CEO Mitch Lowe said in a statement. “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.” The statement goes on to clarify that the list of participating theaters is subject to change, and MoviePass customers should consult the mobile app for updates to that list.

AMC and MoviePass have been publicly at odds since the subscription service drastically cut its monthly subscription price in August 2017. (The company previously relied on a tiered model that scaled monthly pricing from $15 to $50 based on region, much like movie ticket prices can vary from one locale to another.) AMC responded by threatening to drop out of MoviePass’ deal, and potentially even file a lawsuit. The chain’s logic has been straightforward, however: mass adoption of a subscription service like MoviePass could effectively change the perceived value of movies, resulting in a situation where theatrical exhibitors wouldn’t be able to charge enough to keep their own businesses afloat. 

“AMC also believes that promising essentially unlimited first-run movie content at a price below $10 per month over time will not provide sufficient revenue to operate quality theaters, nor will it produce enough income to provide filmmakers with sufficient incentive to make great new movies,” the company said in August.

What’s interesting about today’s development is that MoviePass reportedly didn’t notify AMC or its own customers ahead of time. In fact, AMC’s own support account on Twitter wrote earlier today that MoviePass still has not contacted the chain about the development. Given the public rancor between the two companies, it seems likely that MoviePass made the change quietly as a bit of hardball negotiation, hoping customers would become angry with the theater chain and blame it for the problem. On social media, that appears to be exactly what’s happened. But in reality, the tactic could easily backfire on MoviePass, as customers realize they can’t trust the company to consistently provide access to their favorite theaters. Presenting MoviePass access as arbitrary and subject to political maneuvering is hardly a consumer-friendly tactic.

It’s been clear for some time that MoviePass isn’t simply trying to find ways to bring more people into existing movie theaters. The subscription-price reduction came after MoviePass sold a majority stake to the data firm Helios and Matheson Analytics, Inc., and the change has allowed the company to jump from around 20,000 subscribers to 1.5 million subscribers as of January 2018. MoviePass’ ability to track what movies its customers are watching, and where they’re buying tickets, is valuable data for marketers, advertisers, and distributors. And Lowe has said that selling that data is a major way that MoviePass is going to make money. Not having access to AMC — the largest theater chain in both the United States and the entire world — could make achieving that goal more difficult, since it would be clear MoviePass’ data would be incomplete. There are good reasons AMC was the first chain MoviePass signed a deal with, and that importance is likely why MoviePass is being so aggressive around AMC now.

MoviePass is already trying to add revenue streams past its data-driven approach. The company has been heavily promoting movies like I, Tonya and Forever My Girl to its users, clearly as part of a paid promotional package. And before 2018’s Sundance Film Festival, the company announced it had spun up a division that will actually acquire movies, then use a traditional distribution company to get them into theaters. During Sundance, it partnered with distributor The Orchard to purchase North American distribution rights for Bart Layton’s American Animals for $3 million, giving the company the opportunity to create a closed loop with a captive audience: it can own part of a movie that it then promotes to its own customers, driving up the ticket sales that its own subscription service helps generate.

And like most entertainment companies, MoviePass is already looking beyond theatrical exhibition. In November, CEO Mitch Lowe said on CNBC that the company would eventually launch its own streaming service as well. But as MoviePass tries to hardball AMC into going along with its demands, and as it lures in millions of customers by offering increasingly lower ticket prices, it’s important to remember that when something seems too good to be true, it often is. 

MoviePass isn’t trying to help movie theaters; it’s trying to use them to capture data it can sell. It isn’t trying to help people see more movies out of some altruistic bent; it’s hoping to spike attendance in the short term so it can expand the pool of people whose data it’s collecting. And when it doesn’t get the answers it likes from a chain like AMC, it’s willing to cut those theaters out completely, regardless of the harm that does to its customers or reputation. While a $9.95 subscription deal may sound great, it’s really only a good deal if it works consistently, at the theaters where customers want to use it. And as MoviePass’ CEO said, those theaters are subject to change.

Variety: Sundance - MoviePass, The Orchard Buy 'American Animals'

CREDIT: COURTESY SUNDANCE

CREDIT: COURTESY SUNDANCE

MoviePass Ventures and The Orchard are partnering to buy North American distribution rights to “American Animals,” an art heist drama that premiered at this year’s Sundance Film Festival. The deal was for $3 million and involved a significant P&A commitment, according to a knowledgeable source.

It’s a unique pact, combining the resources of a subscription ticketing service that’s been likened to the Netflix of the exhibition space with the indie studio behind “Cartel Land” and “Hunt for the Wilderpeople.” At the start of the festival, MoviePass announced that it was looking to buy films and was hoping to partner with a more traditional distribution company. It had talked to studios about partnering on a deal to purchase “Blindspotting,” but that film ultimately sold to Lionsgate. MoviePass’ subscriber rolls currently exceed 1.5 million people, so theoretically it has access to data on consumer habits that could help the companies pitch the film to consumers.

American Animals” hit the mountainside festival with a lot of buzz for its colorful plot, kinetic direction by Bart Layton, and the performances of stars-on-the-rise like Evan Peters and Barry Keoghan. The film unfolds in 2004 and follows childhood friends Spencer (Keoghan) and Warren (Peters) as they rebel against their suburban upbringing in a posh corner of Kentucky. The two plot to steal priceless Audubon prints and rare books from Transylvania University’s special collections library. Their exploits rank as one of the most audacious art thefts in recent history. But reality proves to be very different than fantasy, and while they had visions of pulling off a grand caper, Spencer and Warren are eventually forced to grapple with the moral consequences of their criminality.

Reviews for the film were strong. Variety’s Guy Lodge called the picture “wildly entertaining,” and wrote that it works as “a riveting college-boy crime caper that tiggers along on pure movie-movie adrenaline, before U-turning into a sobering reflection on young male privilege and entitlement.”

“American Animals” was co-financed and developed by Film4, which previously backed Layton’s first feature debut “The Imposter,” and “I, Tonya” maker AI Film. It is a Raw production, and was produced by Katherine Butler, Derrin Schlesinger, Dimitri Doganis, and Mary Jane Skalski.

The deal was negotiated by Danielle DiGiacomo, VP of acquisitions for The Orchard. Khalid Itum, VP of business development, Zac Bright, director of business development at MoviePass, represented the subscription service. Vince Holden at AI Film and UTA Independent Film Group represented the filmmakers.

Sierra/Affinity will handle international sales on “American Animals.” Those rights are still available.

The Washington Post: The MoviePass deal: For less than $120 a year, you can see 365 movies. Here’s the catch.

MoviePass is a film nerd’s dream. The subscription service allows users to see one movie a day at a theater for a single monthly cost. The service isn’t new, but it’s become popular among a lot more than movie buffs in the past few months.

During its first six years as a company, MoviePass relied on the idea that most of its 20,000 subscribers wouldn’t use the service. It’s the way many gyms make money: Convince users to sign a contract, then hope they’ll never actually show up to use a treadmill.

But when Mitch Lowe, a Netflix co-founder, took over MoviePass as CEO in June 2016, he opted to flip this revenue model on its head.

First, he teamed up with data firm Helios and Matheson Analytics Inc., which bought a controlling interest in the company. Then, in August, he announced a radical overhaul to the company’s pricing model, dropping the cost from around $50 to $9.95 per month.

Instead of hoping subscribers skip out on the movies, Lowe wants MoviePass customers to visit the theater as often as possible. Because the more movies its subscribers see, the more data the company rakes in. And that’s where the real dough is.

“The big money for us was always understanding the consumers habits and the data, because no one’s ever done that,” Ted Farnsworth, CEO of Helios and Matheson, told The Washington Post.

After the pricing change, the service exploded in popularity, adding 150,000 subscribers in two days, Lowe told The Post. Since then, its user base has grown to 1.5 million subscribers. It added 500,000 of those in last month alone. (For comparison’s sake, it took Netflix about four years to reach 1 million subscribers.)

MoviePass is trying to drive customers to movie theaters at a critical time. Movie attendance in 2017 dropped by more than 6 percent from the previous year, according to Box Office Mojo, which noted about 82 million more tickets were sold in 2016 than 2017.

The average movie in America costs $8.97, according to the National Association of Theatre Owners. In cities such as New York and Washington, tickets can run $15 to $20. MoviePass customers would only need to see one or two movies a month to get their money’s worth. According to the Motion Picture Association of America, 11 percent of American and Canadian moviegoers already do just that.

Since MoviePass pays the full price for each ticket, it quickly loses money on many customers.

“They definitely need to generate revenue from ancillary revenue sources,” Eric Wold, an analyst with B. Riley FBR, a financial services company, told The Post. He added that the company will probably raise its prices over time, much like Netflix did, but even then it will still require other income sources.

The company has spoken of seeking of concession revenue from the theaters to which it sends moviegoers, according to Fortune. During the weekend, the company announced that it will be investing in movies.

But Wold — echoing Farnsworth — said data is the key to the company’s potential success.

While most theater chains track its own customers’ habits, Wold said MoviePass is the first service that can track moviegoers across nearly all theaters in America. Those insights could be valuable to the restaurants, bars and even retail outlets situated around movie theaters, according to Wold.

“That data could help local restaurants, or local clothing stores, market to the moviegoers,” he said, pointing out that many theaters are in malls or strip malls. The other businesses occupying that space would probably pay to know when certain demographics will be visiting en masse.

The service also has a direct line to avid moviegoers, which could benefit the studios themselves.

Wold said while average moviegoers are willing to shell out upward of $15 for blockbusters such as “Star Wars,” they might often wait for smaller fare like “Lady Bird” to hit streaming services. Having MoviePass encourages users to see the smaller films that they wouldn’t normally shell the money out for.

“They’ve already shown results from the non-blockbuster films getting an increase in traffic from MoviePass subscribers,” he said. For example, the service accounted for 1.7 percent of ticket purchases on the opening weekend for the comic book blockbuster “Justice League.” But it accounted for 10 percent of ticket sales of the independent film “Three Billboards Outside Ebbing, Missouri,” according to a news release.

Studios have noticed.

“In the short term, we’re already using the data to promote titles on behalf of the studios. Studios are paying us around two dollars per ticket we buy in exchange for us marketing their film,” Lowe said.

But while studios might be pleased, not all the movie theater companies are.

Cinemark, which owns more than 500 theaters nationwide, launched its own truncated version of MoviePass, called Movie Club, in December. For $8.99, moviegoers can see one movie each month at a Cinemark theater and receive a 20 percent discount on concessions, according to a news release. Like MoviePass, Cinemark’s version doesn’t apply to 3-D movies.

AMC Theatres, which has more than 650 locations in the United States that serve around 200 million moviegoers every year, loudly voiced its opposition to MoviePass in August. The company said the service “is not in the best interest of moviegoers, movie theaters and movie studios” in a harsh statement that said it was consulting with attorneys to determine “if or how” it could prevent MoviePass from being used in its theaters.

“From what we can tell, by definition and absent some other form of other compensation, MoviePass will be losing money on every subscriber seeing two movies or more in a month,” the release stated, cheekily adding, “AMC noted that it is not yet known how to turn lead into gold.”

AMC said it fears that MoviePass offers a price point that’s too good to be true and will eventually go belly-up, disappointing moviegoers who grew used to the cheaper pricing.

If MoviePass fails, “subscribers will have to return to paying between $10 to $15 for a single ticket. After three months with the service, I don’t think I could do that,” Nick Statt wrote in the Verge, adding, “once you’ve gotten something for what feels like free, it’s difficult to go back to paying for it.”

The explosive interest in MoviePass signal that moviegoers are seeking a change, and there’s no indication that it will slow any time soon — unless it proves to be an unsustainable model. AMC declined a request from The Post for comment, but recent remarks from the chain’s CEO Adam Aron hint that the company might be warming to the idea — but still has no plans to share its own revenue.

“We appreciate their business,” Aron said in a November conference call with analysts, according to the Hollywood Reporter. He added, “AMC has absolutely no intention — I repeat, no intention — of sharing any — I repeat, any — of our admissions revenue or our concessions revenue.”

L.A. BIZ: MoviePass to invest in movies before it sells cheap tickets to them

MoviePass arrived at the Sundance Film Festival this week not just as seller of cheap movie tickets but as a buyer of the movies themselves.

The New York-based movie theater subscription service has launched MoviePass Ventures, a wholly owned subsidiary that will co-acquire films with distributors.

Although details are scarce, and no distributor partnerships or film acquisitions have been announced, the move provides more insight into how the company plans to make money.

MoviePass relaunched in August with an all-you-can-watch movie subscription plan for just $10 per month. Subscribers can go to one movie per day, every day, with no blackout dates (excluding Imax and 3-D showings) for one flat monthly rate that’s about a buck more than the cost of one average movie ticket — and a lot less for many moviegoers.

Earlier this month, the company announced it had surpassed 1.5 million subscribers.

Screen Shot 2018-01-20 at 1.03.49 PM.png

Meanwhile, MoviePass, which is majority owned by Helios and Matheson Analytics Inc. (NASDAQ: HMNY), reimburses movie theaters for the full price of those tickets and is operating at a loss as it attempts to convince the industry that its service increases moviegoing.

The company said that it accounts for about 3 percent of domestic ticket sales, but that figure goes up to more than 10 percent of a particular title’s domestic box office when MoviePass promotes the movie to its subscribers. The company said it has boosted its share of domestic box office to 10 percent for such films as “The Post,” “Three Billboards Outside of Ebbing, Missouri,” “Call Me by Your Name” and “The Shape of Water.”

And such increases in the theatrical window pay dividends downstream on platforms such as DVD/Blu-ray, digital, streaming, pay TV, network television, airlines and hotels, and foreign sales.

MoviePass will apply these marketing strategies to the films it co-acquires.

“Given the successes we have demonstrated for our distributor partners in ensuring strong box office in the theatrical window, it’s only natural for us to double down and want to play alongside them — and share in the upside,” said CEO Mitch Lowe in a statement.

“We aren’t here at Sundance to compete with distributors, but rather to put skin in the game alongside them and to bring great films to the big screen across the country for our subscribers,” added Helios and Matheson Analytics CEO Ted Farnsworth.

Reuters: BRIEF-Helios And Matheson Analytics Says Co And Moviepass Entered Into Amendment No. 1 To Voting Agreement

* HELIOS AND MATHESON ANALYTICS - ON JAN 16, CO AND MOVIEPASS INC ENTERED INTO AMENDMENT NO. 1 TO VOTING AGREEMENT-SEC FILING 

* HELIOS AND MATHESON ANALYTICS - PURSUANT TO THE AMENDMENT, CEO OF COMPANY TO BE ENTITLED TO DESIGNATE THREE PERSONS TO SERVE ON MOVIEPASS BOARD 

* HELIOS AND MATHESON ANALYTICS - ‍THEODORE FARNSWORTH, COS CEO DESIGNATED HIMSELF & CARL SCHRAMM AS DIRECTORS OF MOVIEPAS 

* HELIOS AND MATHESON ANALYTICS - ‍MITCHELL LOWE, CEO OF MOVIEPASS, DESIGNATED HIMSELF & CHRIS KELLY AS DIRECTORS OF MOVIEPAS Source text - bit.ly/2DsShY5 Further company coverage:

Forbes: Subscription Service MoviePass Is Going To Revive Moviegoing -- Or Go Broke Trying

MoviePass is a service that lets subscribers go to the movies as many times as they want for $9.95 a month. The seven-year-old company touts itself as the solution to high ticket prices for consumers and stagnant ticket sales for theater chains. But MoviePass has had a rocky road to its current 1.5 million subscribers. The company took a while to find a price that worked for consumers. When it rolled out the $9.95 service this past August, the company was unprepared for the surge in demand. Meanwhile theater chains remain wary of any incursion on their turf and most still make MoviePass pay full retail price for tickets it distributes to subscribers—meaning it loses money on almost every transaction. In an expensive place like New York City the cost of a movie ticket can be $16. MoviePass is making a bet that by losing money to acquire customers now it will drive so much more traffic to theaters that eventually the chains will have to cut the subscription service in on the increased action--presuming, of course, that MoviePass doesn’t run out of money first.

MoviePass CEO Mitch Lowe led the company to 1.5 million subscribers.

MoviePass CEO Mitch Lowe led the company to 1.5 million subscribers.

The company was cofounded by Stacy Spikes and Hamet Watt. Since June 2016, however, it has been led by CEO Mitch Lowe, 65, former founding executive at Netflix and COO and President of Redbox. In 2017 Lowe engineered the sale of a majority stake to analytics firm Helios and Matheson Analytics for $27 million. In this interview which has been edited and condensed, Lowe talks about how he plans to make the company profitable and why marketing a subscription movie service is a little like selling health insurance.

Natalie Robehmed: How did you get involved with MoviePass?

Mitch Lowe: I left Redbox in November of 2011. In 2012 a friend introduced me and Mark Randolph, one of the cofounders at Netflix, to the founders of MoviePass. We saw that they were going after this niche audience of heavy moviegoers and they were pricing it as such: $30, $40, $50 a month. We started advising them to look at the people who aren't going as much. They didn't see eye to eye with us, so Mark and I walked away at the beginning of 2013. In January 2016 I was at the Sundance Film Festival at a party at Chris Kelly's house. Chris, who had been Facebook’s first chief privacy officer, had become the major shareholder in MoviePass. Over the next couple of months we kept talking and then finally I invested in June of that year and came in as CEO.

Robehmed: How much had the company raised at the time?

Lowe: Just under $14 million over four or five years.

Robehmed: How many subscribers were there?

Lowe: There were about 23,000. The average price was $35. They had different price points by market: New York was $44.95, Kansas City was $29.95 and then there was a mid market at $34.95. I think 70% of the subscribers were in those higher cost markets.

Robehmed: What did you do when you took over?

Lowe: I wanted to understand a couple of things. One was, were those people who only go to four or five movies a year interested in going more? We found out there are 200 million people that tend to go four to five times a year. Then we researched "What's the correlation between what you charge the customer and how often they go?" At $45, our average customer went to 3.8 movies. At $35 they went to 2.8. At $25 they went to 1.8. And at $14.95 they went to 1.1. There's some seasonality in that, it goes up a little bit in December and down a little bit in February.

For our target audience, which is people under 35, one of the biggest impediments is "I don't know if this movie's worth it." Having a subscription where, if you see a movie and don't like it, you can just walk out, that's really worth money. At $14.95 it was still a big deal, but at $9.95 there wasn't a single person who we interviewed who didn't say, "I'd be crazy not to try this." Every price above that, we lost people.

Robehmed: But at $9.95, you’re losing money even if they only go to one movie a month. Was it hard to find investors willing to bankroll that?

Lowe: I couldn't get anybody to believe. When you do a subscription, especially an all-you-can-eat, the first subscribers you get, about 11% of the total, are going to be in high cost markets and they're going be people who see a lot of movies. It's like health insurance: The first sign ups are the people that are going go to the hospital. You have to weather the storm to get to the profitable subscribers. You've got to get enough breakeven customers to off-set the expensive ones. I think I met 150 different VCs and family funds. Then I ran into Ted Farnsworth who owns this company called Helios and Matheson in May or June 2017. He was the first person to really believe in the $9.95 price point and was willing to come to the table with the money that it would require. Funding a company like this is not a small task. We are going to need $100 million to get up to profitability.

Robehmed: Why did you wait until Helios and Matheson came along to move on the $9.95 price?

Lowe: We didn't have the funds to support it. I wanted to go into this more conservative, so I was ready to do $14.95 to $19.95. And he said, "No. You’ve got to do what the data tells you." I knew then that I had someone who was a big believer and a supporter, and had the ability to help me get the funding for it. We signed the deal on August 15 and that morning launched the service.

Robehmed: How did that go?

Lowe: The first two days we signed up 150,000 subscribers. We were totally unprepared. If you look at the stock purchase agreement between us and Helios and Matheson you'll see there is a bonus clause that if we hit 150,000 in 18 months or 15 months, we'd get $2 million. And we hit it in two days. We were only prepared for about 100,000 subscribers in a month. Our credit cards that we send people have an eight-week turnaround time and we only had one authorized shipper who could ship 50,000 a week. So it took us eight weeks to be able to get a whole new supply.

Robehmed: How many people got mad and canceled?

Lowe: I think 4.2% of people canceled in the first month and that dropped down to 2.2% or so in the second month, and then 1% or something in the third. Our growth has just continued. We're bringing in thousands and thousands every day. And our customers are going to twice as many movies as they went to before. Sixty to seventy percent of our subscribers say, "I wouldn't have gone to the movies if it hadn't been for MoviePass." They tend to like the movie at a higher rate. Sixty to seventy percent say they recommend it. On big titles like Justice League, we bought 1.8% of the national box office, but titles like Lady Bird, we're 10% of the national box office.

Robehmed: Are MoviePass subscribers more interested in independent films?

Lowe: They still see their Star Wars and their big films. But they use MoviePass to go to the smaller films that they previously said, "I'll wait 'til it comes out on Netflix." My real mission here is to create a better way to distribute small films that can't find an audience. When we build this to 10 million subscribers, it will be the perfect way to build opening weekend box office. Our customers have no incremental cost of going. When we recommend a film to them, we're getting anywhere from 7% to 17% of our subscribers going to that film that weekend. Our natural partners are the independent theaters and the independent film makers. If our dream comes true, we'll be having MoviePass exclusives.

Robehmed: What was your revenue for 2017?

Lowe: I can't give you an exact number because now we're part of a small public company, but it's tens of millions.

Robehmed: It’s way more than 2016?

Lowe: We did just under $9 million last year.

Robehmed: How about revenue sharing with the studios or theater owners?

Lowe: As we get bigger and bigger that starts to become material for the studios. So we're demonstrating to four studios and then a bunch of little ones how we can help them be another tool to drive awareness and ticket sales. We actually have one deal already signed. Soon you'll also see an advertising deal. And then there are discounts from the theaters. For example, there's a chain that we have a deal with, where our average cost of a ticket is $7.50. You'll see a growing number of exhibitors signing deals with us. Of course, not the big three. Not for a while anyway.

Robehmed: AMC's been very vocal in its opposition to MoviePass.

Lowe: Not so much anymore. They definitely threatened us. But now they're like, "We're happy to take their money."

Robehmed: Why were they so hostile?

Lowe: This is my third time going through this where the incumbent player freaks out. My whole passion is figuring out business models that get people to consume a lot. In every scenario, the incumbent player should have done that themselves. Then when you do it, their first reaction is, "We've got to protect our current business.” The AMCs of the world have lost touch with their customers.

Yahoo Finance: Moviepass tops 1.5M subscribers

Moviepass - the subscription movie service - announced today that it has hit 1.5 million subscribers. Joining us now with more on Moviepass CEO, Mitch Lowe, and the CEO of its parent company, Helios and Matheson, Ted Farnsworth.

Finanzen.Net: MoviePass™ Surpasses 1.5 Million Subscribers

Less than 30 days after announcing its milestone of 1 million subscribers, MoviePass™, the nation’s premier movie theater subscription service and a majority-owned subsidiary of Helios and Matheson Analytics Inc. (Nasdaq:HMNY), announced today that MoviePass™ added another 500,000 new paying subscribers since December 12, 2017. MoviePass™ subscribers can see a movie every day of the month for a low monthly subscription fee of $9.95.

Mitch Lowe & Ted Farnsworth (Photo: Business Wire)

Mitch Lowe & Ted Farnsworth (Photo: Business Wire)

"MoviePass™ is attracting people back to the movie theaters by lowering their cost, which we believe is transformational for the industry,” said Ted Farnsworth, Chairman and Chief Executive Officer of HMNY. "We believe the data MoviePass™ collects from these million and a half movie-goers will become an important asset to our partners and the future of the movie industry,” Mr. Farnsworth continued.

 

Deadline: MoviePass Jumps Past 1.5M Subscribers In The Post-Holiday Period At The B.O.

 

Less than 30 days after hitting 1 million subscribers, Helios and Matheson Analytics’ MoviePass has now swelled to 1.5M monthly customers.

 

“MoviePass is attracting people back to the movie theaters by lowering their cost, which we believe is transformational for the industry,” said Ted Farnsworth, Chairman and Chief Executive Officer of HMNY in a statement. “We believe the data MoviePass collects from these million and a half movie-goers will become an important asset to our partners and the future of the movie industry,” Mr. Farnsworth continued about the service which provides subscribers with unlimited movie tickets for $9.95/a month.

“Based on the dramatic increase in the number of MoviePass subscribers over such a short period of time, we believe MoviePass will continue to grow its subscriber base significantly,” added Mitch Lowe, Chief Executive Officer of MoviePass. “We’re giving people a reason to go back to the movie theaters and they’re going in droves. With awards season here, we hope we can make Hollywood and exhibitors very happy by filling seats with eager audiences.”

In a $1 billion holiday movie period where moviegoers are seeing anywhere from two to four titles in a two week period, Lowe informed Deadline in November that “We’re funded properly to pay for” the holiday box office period; that the run on the B.O. would not drain the company.

MoviePass has been met with plenty of skepticism by those in the industry, chiefly how the model of charging a monthly price that’s lower than most metropolitan average movie ticket prices can stay afloat (while the consumer pays only $9.95/a month, MoviePass pays full price for each ticket to the exhibitor). Largely big exhibitors like AMC are ticked off that an outside player is determining the new cost of a movie ticket in consumers’ heads. Studios are largely agnostic to MoviePass: The service isn’t taking any money out of their hands, and if they can drive more business to the cinema, then more power to them.

Reuters: Helios and Matheson drops on stock sale plan to raise MoviePass stake

 
 

(Reuters) - Helios and Matheson Analytics Inc (HMNY.O) said on Tuesday it would sell shares to raise funds to increase its stake in online ticketing service MoviePass, sending Helios’ shares plunging 22 percent aftermarket.

The company’s shares soared as much as 31 percent in regular trading after retailer Costco Wholesale Corp (COST.O) agreed to offer a subscription plan that would cover a year of membership for both MoviePass and streaming service Fandor for a flat fee of $89.99.

Helios did not disclose the size, date or terms of the offering.

The company’s shares have sky-rocketed since Aug. 15, when it agreed to buy a majority stake in MoviePass for $27 million.

MoviePass, a Netflix-style movie subscription business, allows unlimited access to more than 90 percent of U.S. theaters for a monthly subscription fee of $9.95.

The switch to a single $9.95 model in August helped the company’s subscriber numbers surge to over 400,000 from less than 20,000 within a month.

To Tuesday’s close of $10.08, Helios had more than tripled  in value this year.

Helios is a highly shorted stock, with about 42 percent of its total float held by short sellers as of Nov. 30, according to Thomson Reuters data.

Seeking Alpha: MoviePass owner announces share offering

 
 
  • Helios and Matheson Analytics (NASDAQ:HMNY) announces a new public offering of shares and warrants that will be issued separately.
     
  • Details on the size of the offering weren't disclosed.
     
  • The company says that it intends to use the proceeds from the offering to increase its ownership stake in MoviePass and support business operations of the movie ticket subscription platform.

InvestorPlace: Helios and Matheson Analytics Inc. Stock Soars on Costco MoviePass Deal

Costco is selling a MoviePass and Fandor subscription for $89.99

Helios and Matheson Analytics Inc (NASDAQ:HMNY) stock was on the rise today following news of a deal with Costco Wholesale Corporation (NASDAQ:COST).

The deal between Costco and Helios and Matheson Analytics Inc has to do with MoviePass. MoviePass is a majority-owned subsidiary of HMNY. The deal allows Costco members to purchase a one-year subscription to the service for $89.99.

The deal also includes a one-year subscription to movie-streaming service Fandor as well. The offering will only be available to Costco customers for a limited time. Those interested will be able to purchase the subscriptions via the retailer’s website from Dec. 12, 2017 to Dec. 18, 2017.

Costco customers that order the MoviePass and Fandor subscriptions will receive digital codes they can redeem for the services. These codes will need to be entered on MoviePass’ and Fandor’s websites to start the subscription service.

For those doing the math, the offer from Helios and Matheson Analytics Inc, Costco and Fandor saves quite a bit of cash. A subscription to MoviePass costs $9.95 per month. This comes to roughly $120 per year. The deal is worth it just for that, but the addition of the Fandor subscription makes it even better for COST customers.

“We’ve long been fans of Fandor’s library of movies and we’re excited to partner with them and Costco to bring new members this incredible limited-time offer,” Mitch Lowe, CEO of MoviePass, said in a statement. “MoviePass is ultimately about celebrating our love of movies, whether you stream them at home or experience them on the big screen.”

HMNY stock was up 15% as of noon Tuesday and is up 178% year-to-date.

Time: MoviePass Just Got Even Cheaper, Thanks to Costco

Movie buffs are in for a treat in 2018, thanks to a new deal that offers year-long subscriptions to both MoviePass and Fandor for half price.

Costco is currently offering an evoucher that bundles a full year of access to MoviePass and Fandor for just $89.99.

MoviePass, which gives free movie tickets, usually costs $120 a year alone. Twelve months of Fandor, a movie streaming service, is $60.

MoviePass offers access to one free full–price movie ticket every day at some 4,000 movie theaters across the country. The MoviePass subscription doesn’t work for 3-D theaters, but there are no blackout dates, meaning fans can catch a movie anytime they like.

Fandor offers subscribers 5,000 movies to stream in the comfort of their own homes. Titles range from Hollywood classics to documentaries, foreign films and the latest film festival favorites.

Customers don’t need a Costco subscription to sign up for the deal.

TechCrunch: MoviePass drops pricing to under $7 per month, if you opt for the annual plan

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MoviePass, the subscription service that lets consumers pay a monthly fee to see unlimited movies in theaters across the U.S., is slashing its prices yet again. The company announced today it’s now offering its service for $6.95 per month, down from the current price of $9.95 per month, when customers commit to a one-year subscription plan. That works out to a flat fee of $89.95 annually.

The deal is a limited-time promotion, as opposed to a permanent pricing change, but MoviePass didn’t say how long the offer is valid. However, it is open to both new and existing subscribers – the latter who would receive a 25 percent savings on their current subscription if switching over to the annual plan.

This is not the first time that MoviePass has dropped its pricing.

When the company introduced its $9.95 per month, one-movie-per-day plan this August, down from $15 for 2 movies per month (or more in select markets like L.A. and NYC, and going as high as $50), it saw so many new sign-ups it had trouble meeting demand. Within a couple of days, 150,000 new users joined, and by September, the company said that its number of subscriptions had grown to 400,000.

As of October, MoviePass had grown to over 600,000 subscribers.

It also said its subscriber churn had dropped from 4.2 percent in the first month, to 2.4 percent in month two.

The service is today majority owned by data firm Helios and Matheson Analytics Inc. (HMNY), after selling a $27 million stake in August. The firm then increased the purchase price in October to $28.5 million, raising its stake to 53.71 percent from 53 percent. In November, HMNY announced plans to raise $100 million to increase its investment even further.

This influx of capital has allowed MoviePass to continue to subsidize the cost of this subscription to the benefit of pass holders, though obviously not profitability at this point. It’s operating in the red while it focuses on growing subscribers.

MoviePass hopes to eventually convince theater owners it’s growing their customer base, so it can be cut in on profits, according to CEO Mitch Lowe, in a report from Variety in August. It also believes it may be able to sell the data collected on its subscribers in the future.

In the meantime, MoviePass is a ridiculously cheap deal for movie-goers. It now works at 91 percent of theaters across the U.S., though not all are happy with the service.

AMC specifically threatened the startup with legal action in August, and announced that MoviePass was “not welcome here.” It said it would try to find a way to opt out, as it believes lowering the cost of ticket prices would devalue the theater-going experience overall.

Others, like Regal and Cinemark, are taking a wait-and-see approach, Lowe earlier said. 

“HMNY continues to be the biggest supporter of MoviePass, as it outpaces any other movie theater subscription service and continues to disrupt the movie theater industry,” said Ted Farnsworth, Chairman and CEO of HMNY, in a statement about today’s new, lower pricing. “We look forward to helping MoviePass continue to broaden its reach and modernize the movie theater industry,” he added.

The annual subscription is available now through MoviePass.com

New York Post: MoviePass dangles big discount heading into holidays

MoviePass is cutting the price of a movie to less than the cost of a popcorn and a drink.

For a limited time, the all-you-can-watch movie ticketwill now cost you just $6.95 a month — 30 percent below its usual $9.95 price.

But there’s a small catch — you have to pay for an entire year upfront. The special-offer $89.95 price includes a $6.55 processing fee.

Back in August, MoviePass was an expensive, niche service, charging users up to $50 a month to see as many movies as they wanted in theaters.

But then the company upset some theaters owners by slashing the price from $50 to $9.95. Americans loved the lower price and the number of MoviePass subscribers ballooned to over 600,000.

Ted Farnsworth, chief executive of Helios & Matheson Analytics, which took a controlling stake in MoviePass before the price cut, told The Post that the company decided to offer the limited-time lower price because it is determined to get its subscriber numbers past the 1 million mark.

It is already making its mark on the theater industry, according to Farnsworth.

MoviePass was responsible for 4 percent of all tickets sold for the recently released “Murder on the Orient Express,” which pulled in over $36 million in its opening weekend, according to Farnsworth.

Photo: Shutterstock

Photo: Shutterstock