Movie-subscription service MoviePass says it is revamping its business model after a tumultuous year.
MoviePass gained popularity in 2017, when it offered customers the ability to see a film a day in theaters for about $10 a month. But the business burned through cash as moviegoers flocked to take advantage of the offer, forcing its parent company, Helios & Matheson Analytics Inc., to raise prices and limit how many films a subscribers could see.
On Wednesday, MoviePass said that going forward it will work closely with a film-production unit launched by Helios, with the goal of getting the businesses to reinforce each other.
The films the unit acquires or produces will increase the number of movies subscribers can access, encouraging visits to theaters and boosting the box-office performance of those movies, MoviePass said. The Moviefone film-information service, which Helios acquired in April from Oath Inc., will support the effort.
“MoviePass subscription, MoviePass Films and Moviefone now have a winning combination that we believe will drive consumers to our films, and re-energize casual moviegoers to go more often and see great films in local theaters—films that consumers often wait to see much later through streaming services,” Mitch Lowe, chief executive of MoviePass, said in prepared remarks on Wednesday.
MoviePass believes the model will allow it to increase its revenues per each subscriber. Helios reported 3.2 million MoviePass subscribers as of last August, but didn’t disclose that count when it reported its third-quarter results in November.
Helios has yet to release its fourth-quarter and full-year 2018 performance.
MoviePass has changed its approach a few times, trying out different pricing options, while Helios bought Moviefone and began the film-production effort. The MoviePass service now offers three different pricing plans, which range in cost from about $10 a month to up to about $25 a month.
MoviePass has considered other changes recently to its pricing model too, with an executive telling Variety in January it planned to offer an unlimited-movie package. The company made no announcement about such a product Wednesday. A spokeswoman said MoviePass expects to announce new plans for the service soon.
Helios has reported losses and accumulated a deficit that stood at $377.3 million as of September 2018.
Right now, Helios trades over-the-counter as a penny stock, and Nasdaq delisted its shares in February for failing to meet the exchange’s minimum-share price requirement. Its current market capitalization is $17 million, according to FactSet.
The company formed MoviePass Films LLC with Emmett Furla Oasis Films LLC in 2018 to focus on developing new movies, such as last year’s love story “Border.” In February, MoviePass Films said it had begun work on “Axis Sally”, a movie about a woman who was known as the voice of Nazi propaganda geared toward American soldiers during World War II.
Write to Micah Maidenberg at email@example.com
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