The beleaguered MoviePass has changed the terms of its subscription plan yet again in a desperate bid for the company’s survival. You may think that previous sentence was hyperbole but I assure you it is not; MoviePass is seriously struggling these days. The stock price of its parent company, Helios & Matheson Analytics Inc., had dropped to below 7 cents per share last weekend and that was after the company resorted to a 250-to-1 reverse stock split last month. For the sake of context, the stock price was $39 per share just ten months ago.
The new MoviePass subscription plan will once again come with a monthly fee of $9.95 and for that you will get to see up to three movies at the cinema every month. The management over at MoviePass claims this will not impact most of their subscribers; only about 15% of MoviePass customers use the service to see four or movies on any given month. If you use up your three monthly tickets you can still use MoviePass to get up to a $5 discount on additional tickets. The new plan also allows users to see “many” new release movies.
The changes announced by MoviePass today are much friendlier than what the company proposed just last week – that plan was $14.95 per month, still utilized peak pricing that could require you to make additional payments to see movies during busy times and blocked access to new releases during their first two weeks at movie theaters.
Longtime subscribers to MoviePass can argue that the newly announced plan is less favorable than the one offered last year – $9.95 per month and you would be right. However, events over the last year show that business model was not sustainable.
“I should have accelerated the process of reducing the burn faster in hindsight,” said company CEO Mitch Lowe in an interview with The Wall Street Journal. “Now I realize no matter how patient investors say they will be, they never are.”
With these changes in mind I feel much more comfortable about recommending a MoviePass subscription to film lovers provided the company can demonstrate it will be around for the long term.