By May, its monthly losses had reached $40 million, and the company said it could require up to $1.2 billion in funding to stay in business. MoviePass sold $164 million worth of bonds to raise funds in June, but that didn't help for long. After an outage last month, we learned that the company had run out of cash, and it was forced to take out a $5 million loan to keep things running. At that point, it was obvious that its days were numbered. It also didn't help that the company started exploring things like movie distribution and production.
Despite its many flaws, MoviePass has earned itself a place in cinema history. It introduced the idea of smartphone-powered movie ticket subscriptions long before the big chains were ready for them. And having a cheap gateway to cinemas was a smart way to encourage people to leave the comfort of their living rooms, where there's an endless supply of things to watch from Netflix, Amazon and other streaming services. It's certainly a more compelling reason to go to theaters than expensive sideshows, like 4DX, which features gimmicks like moving seats, water spraying in your face and interactive smells (?!).
While the theater chains initially rejected MoviePass, they ultimately learned from it. They won't have to experiment with different price points, for one. It's no big surprise that AMC's A-List subscription, which launched in June, costs $20 a month, a sweet spot between MoviePass's original price and the unsustainably low $10 plan. And AMC also learned that it could offer things that MoviePass still can't, like access to premium IMAX, 3D and Dolby Cinema screens. Even something simple, like being able to book tickets ahead of time on your phone, is something MoviePass offers only in select theaters. (You normally have to be near a theater to buy a MoviePass ticket, and all too often that means there are slim pickings at reserved-seating theaters.)
We haven't heard much about Alamo Drafthouse's subscription plan, but the mere fact that it exists is a testament to MoviePass's legacy. And we can expect to see even more theater chains jumping on this bandwagon. After all, the money they lose with subscription tickets is easily made up for with concession stand purchases. That was always a benefit MoviePass marketed to theaters, but it was something it could never profit from on its own.
I've used MoviePass off and on for years, and I'm sad to see how far it's fallen. But at least its successors are far more polished. I've been using AMC's A-List for the past few weeks, which offers three weekly tickets (up to 12 tickets a month) for $20 a month, and it's been a much smoother experience. In particular, I love that it works with AMC's more expensive screens, like IMAX and Dolby Cinema, which can run between $18 and $23 in NYC -- buying just one ticket makes the subscription plan worth it. The obvious downside is that it's limited to AMC's theaters, unlike MoviePass, which works at 92 percent of cinemas in the US. Still, I'm fine relying on one chain in NYC, especially when it's the one with a full-size IMAX screen and multiple Dolby Cinemas.
Like many tech innovators, MoviePass was ahead of its time. You can think of it as something like the Rio Karma, a pioneering MP3 player that was ultimately overshadowed by the iPod. But it didn't help that MoviePass was managed by a company that pursued growth at all costs, which sowed the seeds for its destruction. It's a lesson for every future business: Make sure you can actually afford to be successful.