Subscription movie service MoviePass changed the movie industry by making it super affordable to enter a movie theater. It was is a service a bit too good to be true and many have wandered how long it will last.
The service, which is owned by parent company Helios and Matheson, charges $9.95 a month to see up to one regular 2D movie in theaters a day—including in markets like New York, where a single ticket can easily top $13-$14. MoviePass pays the theaters full price for each ticket. They later added limits for new users. There’s some other similar services out there such as Sinemia, AMC Stubs A-List and Alamo Drafthouse.
But can MoviePass survive? Inn May, it reported spending $40 million more in cash than it brought in. For June, it expected the spending gap to increase to $45 million. In July they ran out of cash.
“If the Company is unable to make required payments to its merchant and fulfillment processors, the merchant and fulfillment processors may cease processing payments for MoviePass, Inc. (“MoviePass”), which would cause a MoviePass service interruption. Such a service interruption occurred on July 26, 2018″ – Helios and Matheson reported in a securities filing on July 27.
Many movie fans were left high and dry Thursday night when the popular MoviePass app crashed. While the shutdown lasted just a few hours, the app was still not fully functional on Friday.
MoviePass parent Helios and Matheson Analytics Inc. implemented a 1-to-250 reverse stock split earlier in the week. Today investors dumped more H&M shares, pushing the stock down 61 percent, to $2.69.
MoviePass doesn’t seem like it will be around for much longer. If you have a subscription, then make sure you use it as much as possible while you can.