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Embattled subscription service MoviePass said Tuesday it is raising its standard membership to $14.95 per month, a big jump up from its current $9.95 price.
“We will be raising our standard monthly price in the near future to continue providing an attractive service to our community while accelerating our path to profitability,” the service said in a statement.
MoviePass addressed subscribers after they were unable to use their subscription cards Monday to purchase movie tickets, an outage that sent stock in parent Helios and Matheson into a freefall (there were also outages over the weekend). The movie service also confirmed that it will limit access by subscribers to first-run movies opening on more than 1,000 screens “in the first few weeks,” such as Mission: Impossible — Fallout.
The day ended with MoviePass chief Mitch Lowe sending an email to patrons further instructing that access to showtimes for all movies may vary from day to day.
Lowe’s dispatch began with an apology for the recent snafus, and ended with a pledge to be more transparent about any changes to the service. Yet his note made no mention of the price hike, which is expected to take effect soon.
“First and foremost, I want to personally apologize to each of you for the inconsistencies and unreliability of our service over the past few days. Additionally, I regret our lack of proactive communication with you during this time; we are working hard to improve the communications to our community moving forward,” Lowe wrote.
He also continued to claim that MoviePass has “revolutionized the movie industry” and is responsible for a “significant portion” of the uptick at the domestic box office so far this year.
Early in the morning, shares in Helios & Matheson jumped on the NASDAQ Exchange to $1.81, from a 72 cent opening price, on news of the price hike for MoviePass, before quickly sliding back to just under 50 cents by the end of trading.
While insisting Mission: Impossible — Fallout would be made “available in the future” to subscribers, MoviePass gave no indication when. The controversial service said it will better inform subscribers on which first-run movies will be out of bounds on their first few weekends at the multiplex so they can “make plans to see a different movie.”
Upcoming releases such as Disney’s Christopher Robin (set to open Friday) and Warner Bros.’ shark movie The Meg (Aug. 10) are also expected to be off-limits to subscribers on opening weekends. MoviePass also said it couldn’t guarantee that there won’t be future outages after earlier disruptions in its service.
“As we continue to evolve the service, certain movies may not always be available in every theater on our platform. We are working to fine-tune this system and will have more to share in the coming weeks,” the service said.
Addressing mounting complaints from subscribers, MoviePass said it is “ironing out the details and algorithms of peak pricing, and as we’ve shared, consumers may experience peak pricing during typical non-peak hours.”
The latest outage follows MoviePass introducing peak pricing, whereby it charges an estimated $2 to $6 extra if users wish to see the most popular movie titles at the most crowded showings. “This is not how the feature is intended to function moving forward, and we appreciate our members’ patience as we’re still in testing mode,” the service said of its peak pricing model.
Read Lowe’s full letter, below.
Dear MoviePass Members,
First and foremost, I want to personally apologize to each of you for the inconsistencies and unreliability of our service over the past few days. Additionally, I regret our lack of proactive communication with you during this time; we are working hard to improve the communications to our community moving forward.
Over the last several days, we’ve begun making changes to our service that will help us continue to offer our members a high-value, low-cost, in-theater movie experience.
We believe that the company we have built — the fastest growing subscription company in history with more than 3 million members — has revolutionized the movie industry in the U.S. The first half of 2018 saw the total box office grow by almost 10 percent compared to last year, and we know MoviePass is responsible for a significant portion of that unprecedented growth.
In order to continue growing our service and maintaining a high level of financial discipline, we need to make some modifications:
We must reduce availability for big new-release titles, such as Mission: Impossible – Fallout and other popular new releases, at least for a while as we adjust the business model. We are working on making this more clear in the app so you know which titles are available.
Showtimes that are offered through our service will vary from day to day, and every showtime may not be available. We encourage you to check the MoviePass app for showtimes before you leave for the theater.
While our customer service team has made great strides of late, we still have a long way to go to provide the most responsive customer service experience for you. In the meantime, access to immediate support may become limited. However, we are working to prioritize the requests of members who are at the theater and introduce more self-help tools, as well as focus our resources on fixing glitches and bugs in the app.
Finally, we want to be as transparent as we can with these changes and any future changes. We are committed to giving you the best experience. We count on your support and loyalty while we implement these necessary steps for the company you’ve grown to love.
Thank you for your understanding and patience, and we’ll be in touch with more updates as we have them.
Mitch Lowe, CEO of MoviePass
July 31, 6:45 p.m. Updated with Lowe’s email.
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