MoviePass Shutting Down, Parent Company ‘Unable To Predict If Or When…Service Will Continue’
It’s over. Helios and Matheson Analytics (HMNY), the parent company of MoviePass announced today that they’re pulling the plug on the famed monthly movie ticket subscription service which offered unlimited tickets for $9.99/a month.
HMNY today said that it formed a strategic review committee comprised of independent directors, to identify, review and explore all strategic and financial alternatives for the Company, including a sale of the Company in its entirety, a sale of substantially all of the Company’s assets including MoviePass, Moviefone and MoviePass Films. Today, MoviePass notified its subscribers that “it would be interrupting the MoviePass service” effective Sept. 14 to because its efforts to recapitalize MoviePass have not been successful to date.
“The Company is unable to predict if or when the MoviePass™ service will continue. The Company is continuing its efforts to seek financing to fund its operations. There can be no assurance that any such financing will be obtained or available on terms acceptable to the Committee,” read a press release.
Where to begin to regale the tales of MoviePass? Though created in 2011 by Stacy Spikes and Hamet Watt, the unlimited ticket movie service looked to have a renaissance when tech company Helios and Matheson Analytics took a huge stake in the service in August 2017, and together with CEO Mitch Lowe (who had been serving since June 2016) offered a Netflix all-you-can-eat pricing monthly model for movietickets. How could they ever make money was what many in distribution and exhibition asked. Neither studios nor exhibitors wanted to give up any share of their box office to this third party. The belief by Lowe and HMNY boss Ted Farnsworth was that a rapid growth of subscribers, ala a Health club business model, would guarantees fortunes. Essentially the percent of those going to the movies each month would be a minority and that the majority of subs would never go. That didn’t happen and in July 2018, during the opening weekend of Mission: Impossible – Fallout, MoviePass officially blacked out. At one point MoviePass bragged it had close to 3M subs. HMNY’s stock sank, and there were a couple of crazy stock splits, but the share price kept melting down to pennies to worthless. Following the Mission: Impossible debacle, MoviePass said it would not cover big studio tentpole pics that were opening anymore, just indies and holdovers. MoviePass subscribers dropped to 225K as of last April.
As MoviePass peaked and blew up, AMC and Regal started their own monthly subscription movie ticket programs. AMC’s put a cap on the amount of tickets for $20/month. Essentially, both exhibitors made sure they were building a program by which they weren’t burning the house down to keep warm; MoviePass being a big example of that.
Last October, then-New York Attorney General Barbara Underwood opened a probe into Helios and Matheson’s business dealings, alleging the company misled investors regarding its financials.
In late December 2017, MoviePass celebrated passing 1M subs in four months. Netflix reached that milestone in 39 months. To celebrate Lowe and Farnsworth took a photo outside AMC’s Empire 25 in New York, laughing at the No. 1 chain in the world. AMC tried to sue the service and shut them down. Now, AMC has the last laugh.
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