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RIP, Time to Begin the Short Wave Goodbye
Last night, Movie Pass and its parent company Helios and Matheson literally ran out of money.
They were bailed out, and if stories running around Reddit are true, the loan had some pretty steep payment requirements (* someone said it was like 20% interest, due in two weeks, 100% APR?).
Anyway, Movie Pass has been hemorrhaging money for months and this business model — while amazing at getting people to adopt the service — has been terrible at generating profits.
I wonder what would have happened if they had just decided, about four months ago, to raise the price for everyone who didn’t have an annual contract?
It has seemed obvious to me for a long time that Movie Pass had proven three things beyond a shadow of a doubt:
- Theater Chains has their price point wrong
- $9.99 was a great price point for getting people to adopt Movie Pass
- Movie pass set their price-point at a bad place to be profitable
In other words, Movie Pass found a great price-point to move people back to the movies but a shitty price point for generating themselves money.
I suspect that somewhere between $9.99 a month and $10 a movie a price-point probably exists that would…
