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The business model was flawed, in that they were over-optimistic about getting theater partners to buy in and sell discounted tickets to MoviePass. $10 for unli
by listenallyall 7y ago
The business model was flawed, in that they were over-optimistic about getting theater partners to buy in and sell discounted tickets to MoviePass. $10 for unlimited films anytime? Not going to work. But $15-18/month for unlimited matinees, or Mon-Thu, or any film 3+ weeks old? Those models are absolutely viable, and would provide revenue and attendance boosts for theater chains who partnered with MP.
Worth noting that AMC, the theater chain which was most vocal and aggressive in dismissing MoviePass, has seen its stock fall by 80% since early 2017 to an all-time low. CINE, an international conglomerate which owns Regal, is at a 5-year low.
- Ancalagon 7y agoAnecdote: I paid $18 for a single movie ticket (no peripherals) at an AMC not even two months ago. To be fair, the theater was packed so they must have been doing something right, but I couldn't believe the price increase even over the last year in movie ticket prices. I guess AMC's downfall strategy is similar to that of AT&T's.
- Rebelgecko 7y agoAMC's version of moviepass seems a lot more sustainable than Moviepass
- listenallyall 7y agoDisagree - for one, see AMC's profit and revenue trends, easily summed up in the stark decline in the stock price. AMC's program is flawed in that it allows (encourages?) its members to use the theater's most valuable inventory, i.e. seeing Star Wars in 3-D or Dolby or IMAX on opening night. The people who joined likely made that decision based on the fact the the membership cost less than their typical ticket spend, thus it costs AMC in lost revenue. Plus the costs of advertising it, administering it, etc.
- scarface74 7y agoMovie theaters have never made much money from ticket sales. They make most of their money from concession sales and to a lesser extent advertising before the movie starts. Also, for rev share purposes , they count each ticket sold via the subscription no matter what at $8.99
- listenallyall 7y agoTicket revenue is the majority of total revenue, while concessions have a much higher margin. For the last quarter with published results, AMC's gross profit on exhibition exceeded that of F&B. ==> http://investor.amctheatres.com/Cache/1001258324.PDF?O=PDF&T=&Y=&D=&FID=1001258324&iid=4171292 http://investor.amctheatres.com/Cache/1001258324.PDF?O=PDF&T... MoviePass sent additional people to the theater --> additional concession sales + additional ticket sales AMC A-List customers occupy prime seats that would have likely been sold anyway --> no effect on concessions, reduced ticket revenue
- scarface74 7y agoThey also said Based on an average monthly frequency of 2.40x for our A-List members in the third quarter, their associated full-price bring-along guest attendance, their food and beverage spend and the price increases in the first quarter, we believe the A-List program was profitable in the third quarter and nine-months ended September 30, 2019 compared to our estimated results if the program had not existed. A-List membership levels continue to exceed our expectations despite our price increase and competitive offerings.
- listenallyall 7y agoLol, you've tried to defend AMC before on other threads. Read between the lines. "We believe" is about the lowest level of confidence one could attribute to a statement like this. No data, no methodology, no measurements. It's equivalent to "we hope" or "we guess" or "we really need this to be true." The company's stock has fallen by 80+%. Management is under extraordinary pressure to defend their major decisions, including the rollout of A-List and the rejection of partnering with MoviePass. OF COURSE management is going to claim their decisions were correct, but they are offering ZERO hard data or evidence to that end.