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The people objecting that this is not cost effective are missing the point that most people who use this service will simply subscribe, forget, and go to the mo

The people objecting that this is not cost effective are missing the point that most people who use this service will simply subscribe, forget, and go to the movies no more frequently than they do now (after a month or so). It's why places like Planet Fitness are able to offer $10/month unlimited memberships.

tertius 9y ago
> Ah, so a great valuable product!
- mbillie1 9y ago
  If you actually use it, sure. Not unlike a gym membership, you let the aspirational purchasing of some people partially subsidize the cost for the actual user base. I'm not making any ethical stand for or against this practice, but it doesn't seem any different than gym memberships (or frankly an online Netflix membership) to me.
FfejL 9y ago
Except that the incremental cost of someone using a Gym is almost zero. Once you have enough members to cover the rent & employees, it's almost all upside. MoviePass will pay about $12 each and every time someone sees a movie -- more than the monthly fee any one member is paying. So every super movie fan watching 10 movies a month requires more than 11 other members paying the monthly fee and then not using their membership at all. Hard to see that math working out.
- mbillie1 9y ago
  > Except that the incremental cost of someone using a Gym is almost zero. Once you have enough members to cover the rent & employees, it's almost all upside. Huh? What exactly do you think a gym's principal expenses are beyond rent, employee cost and equipment maintenance/replacement? And how long do you think a gym treadmill which is run on for ~6 hours a day will last? I'm not saying MoviePass automatically makes sense, but the idea that gyms are "all upside" after the initial equipment purchase is badly misinformed.
  - jsjohnst 9y ago
    > Once you have enough members to cover the rent & employees, it's almost all upside. > but the idea that gyms are "all upside" after the initial equipment purchase is badly misinformed. I'm not sure how you read what GP said, but if you reread it you'll understand that the mistake was on you, not them being misinformed. Emphasis added to both their post and yours to highlight.
ndirish1842 9y ago
>It's why places like Planet Fitness are able to offer $10/month unlimited memberships. That model is far different though For each Planet Fitness, much of the cost is upfront. That is, they have to buy the property, renovate (or build), and then buy all the machines. Yes there are increased maintenance costs as more people join the gym, but cost per user should decrease with each additional membership. For MoviePass, for each user they have to pay for the price of each movie ticket they go to. Thus their costs increase proportionally to the number of subscribers. Unless each additional user they sign up goes to the movies less than the average MoviePass user, Cost per user doesn't decrease.
- mbillie1 9y ago
  > For each Planet Fitness, much of the cost is upfront. That is, they have to buy the property, renovate (or build), and then buy all the machines. As said before, this is not remotely accurate. Firstly, nearly all of these franchises rent their building space. Secondly, as with any B&M business, fully loaded employee costs comprise a majority of operating expenses. Thirdly, gym equipment maintenance is a non-trivial ongoing factor. Certainly the initial equipment purchase is a bubble, but the idea that PF is only fiscally viable due to equipment longevity is specious at best. You can see an estimate breakdown of PF expenses here: http://www.franchisedirect.com/fitnessfranchises/planet-fitness-franchise-12988/ufoc/ http://www.franchisedirect.com/fitnessfranchises/planet-fitn... Note fitness equipment estimates range from $35,930 to $944,800; re-equip costs are estimated at $359,900 to $944,800. (that low estimate on re-equip may be a typo, it is likely re-equip costs are estimated in the same range)
jccalhoun 9y ago
I would imagine that there is some deal in place that takes the profit from the local movie theater. Theaters already make most of their money from concessions and only get a portion of the ticket price (I think that on opening weekend theaters give most of the money to the film companies and then the rate goes down the longer a movie is out? I don't know if I am remembering that right) So I wouldn't be surprised if part of this deal is that local theaters don't get any of that $10 a month.
nolepointer 9y ago
>It's why places like Planet Fitness are able to offer $10/month unlimited memberships With a $40 annual membership fee, as well, though. But yeah, they're making money off of me. I went nearly every day until I started full-time work. Now, it's just far more convenient to use my neighborhood gym during the morning, though the equipment is lacking. But I retain the membership on the chance that I might use Planet Fitness's facility instead, because it's only $10!

tertius 9y ago

> Ah, so a great valuable product!

mbillie1 9y ago
If you actually use it, sure. Not unlike a gym membership, you let the aspirational purchasing of some people partially subsidize the cost for the actual user base. I'm not making any ethical stand for or against this practice, but it doesn't seem any different than gym memberships (or frankly an online Netflix membership) to me.

FfejL 9y ago

Except that the incremental cost of someone using a Gym is almost zero. Once you have enough members to cover the rent & employees, it's almost all upside. MoviePass will pay about $12 each and every time someone sees a movie -- more than the monthly fee any one member is paying. So every super movie fan watching 10 movies a month requires more than 11 other members paying the monthly fee and then not using their membership at all. Hard to see that math working out.

mbillie1 9y ago
> Except that the incremental cost of someone using a Gym is almost zero. Once you have enough members to cover the rent & employees, it's almost all upside. Huh? What exactly do you think a gym's principal expenses are beyond rent, employee cost and equipment maintenance/replacement? And how long do you think a gym treadmill which is run on for ~6 hours a day will last? I'm not saying MoviePass automatically makes sense, but the idea that gyms are "all upside" after the initial equipment purchase is badly misinformed.
- jsjohnst 9y ago
  > Once you have enough members to cover the rent & employees, it's almost all upside. > but the idea that gyms are "all upside" after the initial equipment purchase is badly misinformed. I'm not sure how you read what GP said, but if you reread it you'll understand that the mistake was on you, not them being misinformed. Emphasis added to both their post and yours to highlight.

ndirish1842 9y ago

>It's why places like Planet Fitness are able to offer $10/month unlimited memberships. That model is far different though For each Planet Fitness, much of the cost is upfront. That is, they have to buy the property, renovate (or build), and then buy all the machines. Yes there are increased maintenance costs as more people join the gym, but cost per user should decrease with each additional membership. For MoviePass, for each user they have to pay for the price of each movie ticket they go to. Thus their costs increase proportionally to the number of subscribers. Unless each additional user they sign up goes to the movies less than the average MoviePass user, Cost per user doesn't decrease.

mbillie1 9y ago
> For each Planet Fitness, much of the cost is upfront. That is, they have to buy the property, renovate (or build), and then buy all the machines. As said before, this is not remotely accurate. Firstly, nearly all of these franchises rent their building space. Secondly, as with any B&M business, fully loaded employee costs comprise a majority of operating expenses. Thirdly, gym equipment maintenance is a non-trivial ongoing factor. Certainly the initial equipment purchase is a bubble, but the idea that PF is only fiscally viable due to equipment longevity is specious at best. You can see an estimate breakdown of PF expenses here: http://www.franchisedirect.com/fitnessfranchises/planet-fitness-franchise-12988/ufoc/ http://www.franchisedirect.com/fitnessfranchises/planet-fitn... Note fitness equipment estimates range from $35,930 to $944,800; re-equip costs are estimated at $359,900 to $944,800. (that low estimate on re-equip may be a typo, it is likely re-equip costs are estimated in the same range)

jccalhoun 9y ago

I would imagine that there is some deal in place that takes the profit from the local movie theater. Theaters already make most of their money from concessions and only get a portion of the ticket price (I think that on opening weekend theaters give most of the money to the film companies and then the rate goes down the longer a movie is out? I don't know if I am remembering that right) So I wouldn't be surprised if part of this deal is that local theaters don't get any of that $10 a month.

nolepointer 9y ago

>It's why places like Planet Fitness are able to offer $10/month unlimited memberships With a $40 annual membership fee, as well, though. But yeah, they're making money off of me. I went nearly every day until I started full-time work. Now, it's just far more convenient to use my neighborhood gym during the morning, though the equipment is lacking. But I retain the membership on the chance that I might use Planet Fitness's facility instead, because it's only $10!