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How are the movie theaters supposed to undercut somebody who is deliberately losing money on every transaction, without driving themselves out of business? Thi
by smacktoward 7y ago
How are the movie theaters supposed to undercut somebody who is deliberately losing money on every transaction, without driving themselves out of business?
This is the new VC-funded business model: you use cash as a kind of anti-gravity machine, letting you do things no competitor would do because they aren't economically rational. The bet is that, if by defying gravity you can reach a monopoly position, you'll end up making back all that cash and more. But as MoviePass demonstrated, once the cash dries up and gravity starts applying to you again, if you haven't reached that monopoly position, the fall is quick and painful.
- astronautjones 7y ago> This is the new VC-funded business model: you use cash as a kind of anti-gravity machine, letting you do things no competitor would do because they aren't economically rational. The bet is that, if by defying gravity you can reach a monopoly position, you'll end up making back all that cash and more. But as MoviePass demonstrated, once the cash dries up and gravity starts applying to you again, if you haven't reached that monopoly position, the fall is quick and painful. the next decade will be defined by the failure of these anti-gravity tricks
- gwbas1c 7y ago> How are the movie theaters supposed to undercut somebody who is deliberately losing money on every transaction, without driving themselves out of business? Patience. Someone deliberately loosing money on every transaction will go out of business very quickly. (And, apparently this is what happened to Moviepass.) Remember, Moviepass bought the tickets from the theaters, so it's not like the theaters lost money waiting for Moviepass to go out of business.