Business

MoviePass Changes Subscription Plan, Increases Prices

MoviePass

After telling subscribers in June that it would roll out “peak pricing,” MoviePass has announced surcharges based on demand. The fees will be based on a movie’s showtime and title and such showings would be highlighted with a lightning bolt icon, Variety reported.

“Peak Pricing goes into effect when there’s high demand for a movie or showtime,” MoviePass told subscribers. “You may be asked to pay a small additional fee depending on the level of demand. You can avoid the surcharge by selecting a different showtime or movie. Over the coming weeks we’ll also be introducing Peak Pass, which will allow you to waive one peak fee per month.”

The company launched the pricing “in select markets with the intention of keeping our subscription service attractive while offsetting the high costs associated with heavy demand of certain films or showtimes,” according to another statement by the company.

MoviePass announced that it had exceeded 3 million paying subscribers and expects to hit 5 million subscribers by the end of the year, it was reported in June. According to reports, the subscription service, which allows customers to watch a movie a day for less than $10 a month, had said it represents more than 5 percent of U.S. box office receipts, with its peak weeks around 8 percent of box office.

But its parent company, Helios & Matheson, saw its stock hit an all-time low last month, losing nearly nearly half of its remaining value after the company disclosed in a regulatory filing that it has been losing an average of $21.7 million in cash on a monthly basis between September and April. In April, the company announced it was looking into selling as much as $150 million in stock.

Yet Ted Farnsworth, head of Helios & Matheson, had said the subscription service has enough cash to survive and thrive, saying it has around $300 million in an equity line of credit. “There’s been a feeding frenzy of negativity, but it’s not going to slow us down,” said Farnsworth in an interview. “I’m not worried at all. You’re going to see. We’re doing more acquisitions of movies and companies.”

 

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