MoviePass, and its parent company Helios and Matheson, filed for Chapter 7 bankruptcy, officially killing the theater subscription service. MoviePass didn’t come onto most people’s radar until 2017, but with a $9.95 monthly price it was an offer too good for most to pass up. Millions of subscribers signed up for the service, which promised it would allow them to see a movie a day, every day, for that reasonably-low monthly price. It seemed too good to be true because it was, and as the company changed their rules to be more restrictive, subscribers fled in droves.
The initial promise to see a movie a day was limited to 2D versions only. Soon, more restrictions were placed on consumers, such as limiting which theaters would except MoviePass, and placing arbitrary limits on which dates and times were available to see newer releases. Then, MoviePass angered customers by pulling dishonest tricks, like changing users’ passwords to prevent them from requesting tickets to Avengers: Infinity War. After immense quarterly losses, MoviePass changed their rules once again to only allow subscribers to see three movies a month. The service continued to bleed subscribers, turned off by prohibitive rules and cheap tricks, when theater chains began offering subscription plans of their own, like AMC’s Stubs A-List or Cinemark’s Movie Club.
Now, MoviePass is gone forever, according to THR. Together with its parent company, Helios Matheson Analytics, MoviePass filed for Chapter 7 bankruptcy, indicating they can’t find a path to a profitable business model. The SEC filing, made on January 28, allows the courts to liquidate the holdings of MoviePass and Helios Matheson Analytics, including a film production and distribution division. “As a result of filing the Petition, a Chapter 7 trustee will be appointed by the Bankruptcy Court to administer the estate of the Company and to perform the duties set forth in Section 704 of the Code,” the SEC filing stated.
In worse news for the company, the filing also indicates that it may still owe money to customers. Per The Wrap’s analysis, MoviePass may “owe $1.2 million to roughly 12,000 customers,” a staggering amount of money for a bankrupted business to shell out. MoviePass officially stopped offering services on September 14, 2019, after a previous suspension in July which they initially claimed was to address technical issues.
While it isn’t the first theater subscription service to fail - a rival service called Sinemia shuttered its metaphorical doors in April 2019 - MoviePass should be credited for popularizing the movie theater subscription service trend. In its wake, companies like AMC, Cinemark and Regal Cinemas still offer discounted tickets and concessions via their own subscription-based plans. Unfortunately for moviegoers, many of these competitors simply can’t afford to offer the same incredible, but ultimately unsustainable, deals that MoviePass attempted to build their business around.
More: MoviePass Losses Are Higher Than Previously Known
Source: THR
