Last fall, MoviePass rattled the movie theater industry by offering a seemingly impossible deal: go to a movie a day, every day, for just $10 per month. But what started as an insurrection has quickly become the norm. Even as MoviePass' financial position seems increasingly precarious, the subscription model it kickstarted in the US will live on. Especially now that even AMC is in on the act.
As the largest theater chain in the US, AMC positioned itself early as MoviePass' harshest critic, deriding its cut-rate model as catastrophically unsustainable. But on Wednesday, AMC announced that it would offer a subscription plan of its own: AMC Stubs A-List, an extension of its existing membership rewards play that costs more than MoviePass and fellow subscription upstart Sinemia, but adds appealing benefits. More importantly, AMC's embrace of the subscription model shows that it's here to stay.
At $20 per month, the AMC plan, which which goes into effect June 26, costs twice as much as the MoviePass unlimited subscription, and four times Sinemia's lowest rate, which gets you one movie per month. But AMC still makes a convincing case. While you can't see as many movies as you want, you do get up to three a week, including higher-priced options like 3-D and IMAX. MoviePass currently offers 2-D viewings only. You can also see the same movie as many times as you like, even all on the same day, as long as there’s a two hour buffer between each. You can even reserve specific seats, a feature Sinemia allows for, but through a somewhat convoluted procedure.
"If you’re in the lobby of an AMC and you learn about AMC Stubs A-List you can sign up on your mobile phone, and two minutes later be going to your first movie," says AMC chief marketing executive Stephen Colanero. "You don’t have to wait for a card to be mailed to you. There’s no elaborate process."
Perhaps even more crucial to the AMC pitch: You likely won’t have to deal with the various customer service woes that have plagued MoviePass since the beginning, and have in some ways only escalated as the company tries to clamp down on fraud and stem its financial losses. MoviePass works by issuing you a debit card; in its efforts to ensure that customers use it only for the intended purpose, it has gone as far as demanding that subscribers upload pictures of their ticket stubs, and canceling the accounts of people who use the app from multiple devices. It has also selectively removed movie showings from its schedules, without informing members, to experiment with supply and demand.
Because AMC will, naturally, directly oversee its subscription plan, it requires no such workarounds. There's no physical card; you just link a form of payment to your AMC Stubs account, and reserve tickets either through the AMC website or through its app. Membership also encompasses benefits from the Stubs program's lower tiers, which largely resolve around modest discounts on concessions. And you can, of course, continue to buy tickets the suddenly old-fashioned way.
All told, you’d only have to see two or three movies per month out of your allotted 12 to wind up ahead, with fewer restrictions—aside from the obvious but important caveat that it only works at AMC—than MoviePass. In fact, it’s such a good deal that, in a touch of irony, Sinemia has accused AMC of engaging in the same sort of reckless behavior that AMC decried in MoviePass.
"We are happy to see new entrants in the market who understand that movie ticket subscriptions are the future of moviegoing, and AMC is a great example of this. However, we have concerns over their strategy," says Sinemia CEO Rifat Oguz. "When we look at the details of the AMC plan we fear that this will devalue the movie experience and simply is not sustainable."
At the very least, it appears not to be a loss leader; AMC has told analysts that it expects the subscription plan to add incremental benefit to its bottom line. But either way, its very existence guarantees what had previously been in doubt: Subscription plans aren’t going anywhere, even if MoviePass does.
MoviePass continues to insist that its business prospects remain strong, and that it will continue as a going concern. "We are absolutely thrilled that AMC has finally stepped up to embrace a model that we’ve known all along will be the future of our industry. The MoviePass Effect has made its mark and the model is here to stay," the company said in a statement. "Our key differentiator is that we pave a path of success for independent and small theater chains, where we will continue to focus our efforts."
The positivity belies an increasingly precarious financial position. In addition to burning through money at a rapid pace, MoviePass parent company Helios and Matheson Tuesday outlined several financial restructuring proposals in a bid to prevent being delisted from the NASDAQ.
"MoviePass really is struggling here," says Leo Kulp, an analyst with RBC Capital Markets who follows AMC.
But MoviePass also has over three million subscribers. Sinemia has not released its own numbers, but it continues to grow every quarter. With AMC on board, the model it pioneered stateside has officially gone from a kooky experiment to simply how things work now.
"I do think that subscription programs are here to stay," says Kulp. "The MoviePass price point is probably not sustainable, but consumers have spoken."
In some ways, that simply catches the US up with Europe, where movie theater subscriptions—including one from AMC—first came into fashion several years ago. And it similarly catches the movie theater industry up with, well, the myriad other corners of the world that have abandoned or supplemented a la carte with a monthly charge buffet.
"With so many other similar models in so many other different categories, the confidence was pretty much already there that it should be able to work at the right price point,” says AMC's Colanero. The theater chain also already has nearly 15 million members in its existing Stubs plans, giving it a healthy existing pool of potential paid customers.
The point is not that everyone should sign up for AMC’s subscription. MoviePass will continue to offer an incredible budget option for as long as it’s viable, and Sinemia offers many of the A-List perks, but at lower prices for less frequent moviegoers. The point is that the practice no longer exists solely on the fringe. The future of going to the movies got here faster than anyone expected.
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