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MoviePass Bows Annual Subscription Priced 30% Below Monthly Rate

20 Nov, 2017 By: Erik Gruenwedel

Seeking to reach 1 million subscribers, MoviePass is offering a limited annual subscription plan for $83.40 — 30% below the normal $9.95 monthly rate. The yearlong plan also charges a $6.55 processing fee, bringing the total cost to $89.95.

The New York-based service headed by Mitch Lowe in October announced it had surpassed 600,000 subscribers — up from 20,000 subs in August when it revamped the monthly fee to $9.95 from $29.95.

“We are entering the prime movie-going season, so now is the perfect time to take advantage of [MoviePass],” Lowe said in a statement.

While the winter holidays can be a boon for holiday-themed titles, the theatrical business continues to suffer from a cyclical change: Younger millennial consumers don’t go to the movies.

Indeed, with industry reports suggesting the average American buys four theatrical tickets annually, MoviePass seeks to up Cineplex foot traffic by enabling subscribers one visit per day.

Michael Pachter, media analyst with Wedbush Securities in Los Angeles, contends MoviePass could surpass break-even if its subscribers on average see only one movie per month. If members on average see more than one movie per month, losses will be substantially higher.

"With an annual membership we think some of its subscribers are more likely to treat the membership like a gym membership, letting some months slip without use," Pachter wrote in a Nov. 20 note.

While avid users could dampen box office receipts, MoviePass is banking on the fact moviegoers also buy concessions — the bulk of theater operator profits.

Ted Farnsworth, CEO of Helios and Matheson Analytics, corporate parent of MoviePass, said the service is outpacing other movie theater subscription service.

“We look forward to helping MoviePass continue to broaden its reach and modernize the movie theater industry,” he said.

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