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I mean, like I said, it's not that exploitation won't occur, it's that the exploitation will be too sporadic to make a meaningful difference in overall cash flo
by solatic 9y ago
I mean, like I said, it's not that exploitation won't occur, it's that the exploitation will be too sporadic to make a meaningful difference in overall cash flow.
That MoviePass isn't profitable right now isn't so much because exploitation is more widespread than the MoviePass founders expected, and more because it's still new enough that most subscribers are going through their initial binges before they'll settle into their normative consumption habits.
The average American adult goes to some five movies per year [0]. Increasing that to your new rate of consumption of roughly once per week - more than fifty movies per year - would be an order of magnitude. Even if attendance increased only to the break-even point, it would basically double attendance.
So either MoviePass has no or little affect on aggregate movie attendance, in which case they make money hand-over-fist for extracting twice the money from aggregate subscribers for the same amount of aggregate product, or MoviePass has a strong positive affect on attendance, in which case there are other avenues for profits, as other people have mentioned - data mining, concessions, etc.
[0] https://www.marketingcharts.com/industries/media-and-entertainment-39161 https://www.marketingcharts.com/industries/media-and-enterta...
- adjkant 9y agoI think it's the second, and I doubt the alternative ways to profit is my thing. I think they are banking on one of those paying off. I doubt many people get movie pass and lose money on it frankly. Somewhere around 1-5%. If you are going to only 5 movies a year, and price isn't the issue, you have no reason to buy MoviePass. The majority of the customers are likely those who they will lose money on. I think on average they are losing quite a lot per user, and the data can't be all that useful. If it takes a year to get useful data, and they lose an average of $100 a year per person (a bit under two movies a month per person on average), is each person's data worth that? As far as concessions, big theatres hate MoviePass right now and I don't see them getting a cut of that confessions profits anytime soon. I'm riding the wave of free movies but doubt they last. I think it's far more likely it pressures the industry to change its model but they aren't going to be getting rich off of it without a strong pivot from the current business model.