3 ms·

In a world of perfect competition you'd be correct. The airline business is close enough to that ideal, that little profits are made. But the reality of the Cin

by eloff 8y ago

In a world of perfect competition you'd be correct. The airline business is close enough to that ideal, that little profits are made. But the reality of the Cinema business in the US is they make healthy profits.

gamblor956 8y ago
On concessions, not on the movie tickets. Most of the price of a movie ticket goes to the studio/distributor for the first month. By the time the theater takes >50% of the price of the ticket, the audience has dropped to the low single-digits per showing. The MoviePass customers that most used the service (aka >3 movies a month) were also the ones least likely to buy concessions. Thus, theaters had no incentive to give MoviePass a share of their gross (meaning total) concessions revenue in lieu for increased ticket revenue.
- compsciphd 8y ago
  yes/no. I used to never buy concessions. spending an additional $5-$10 on top of my $15 ticket wasn't something i was willing to do. However, if my marginal cost to see the movie is $0, it turns out I was willing to spend $5 or so every so often to get something to munch on during the movie. While I haven't spent a huge amount on concessions, I've probably spent more on concessions in the 6 months I've had moviepass than in the combined 30+ years preceding it.
  - gamblor956 8y ago
    The theaters have access to lots of data on their moviegoers, especially through their rewards programs. Way more than what MoviePass has. If the data showed that MoviePass members were more likely to buy concessions to the extent that it affected the bottom line in a material way, right now we would all be feting MoviePass for its daring-do and forward thinking as it announces yet another theater partnership, instead of discussing its impending demise.
    - compsciphd 8y ago
      why? Do you not think AMC created a competing program for this vary reason.

3 ms·

In a world of perfect competition you'd be correct. The airline business is close enough to that ideal, that little profits are made. But the reality of the Cin

by eloff 8y ago

gamblor956 8y ago
On concessions, not on the movie tickets. Most of the price of a movie ticket goes to the studio/distributor for the first month. By the time the theater takes >50% of the price of the ticket, the audience has dropped to the low single-digits per showing. The MoviePass customers that most used the service (aka >3 movies a month) were also the ones least likely to buy concessions. Thus, theaters had no incentive to give MoviePass a share of their gross (meaning total) concessions revenue in lieu for increased ticket revenue.
- compsciphd 8y ago
  yes/no. I used to never buy concessions. spending an additional $5-$10 on top of my $15 ticket wasn't something i was willing to do. However, if my marginal cost to see the movie is $0, it turns out I was willing to spend $5 or so every so often to get something to munch on during the movie. While I haven't spent a huge amount on concessions, I've probably spent more on concessions in the 6 months I've had moviepass than in the combined 30+ years preceding it.
  - gamblor956 8y ago
    The theaters have access to lots of data on their moviegoers, especially through their rewards programs. Way more than what MoviePass has. If the data showed that MoviePass members were more likely to buy concessions to the extent that it affected the bottom line in a material way, right now we would all be feting MoviePass for its daring-do and forward thinking as it announces yet another theater partnership, instead of discussing its impending demise.
    - compsciphd 8y ago
      why? Do you not think AMC created a competing program for this vary reason.