Former Netflix executive proposes $9.95 per month subscription for daily cinema access
(ShareCast News) - A new startup helmed by Netflix co-founder Mitch Lowe has proposed an interesting method designed to get more people patronising movie theatres.
For $9.95 a month, MoviePass intends to offer subscribers a pass that would allow them access to one screening per day at any North American cinema that accepts debit cards.
MoviePass will then reimburse theatres the total price of the ticket, excluding 3D and Imax screens.
The startup raised a significant amount of cash on Tuesday by selling a majority stake to Helios and Matheson Analytics, a small data firm in New York.
Chief executive at Helios and Matheson, Ted Farnsworth said the goal was to build a sizable collection of data on viewing habits over a large customer base; the information could then be used to target advertisements and other marketing materials to subscribers.
"It's no different than Facebook or Google," Farnsworth said. "The more we understand our fans, the more we can target them."
The number one cinema operator in the United States, AMC Entertainment Holdings, lost $1.3bn in its market value earlier in August due to a disappointing performance over the summer, and according to the Motion Picture Association of America, box office revenue grew just 2%, mainly because of an increase in the average ticket price to $8.89 per standard viewing.
MoviePass aims to turn around the decline in the industry, saying that the increased ticket price, not the perceived competition from the likes of Netflix or Amazon Prime was the reason for the fall.
"People really do want to go more often," Lowe said. "They just don't like the transaction."
The company intends to hold an initial public offering by March 2018.