
MoviePass will shut down for good on Sept. 14 - jameslk
https://www.cnbc.com/2019/09/13/moviepass-will-shut-down-for-good-on-sept-14.html
======
filmgirlcw
Last year, I bought a MoviePass t-shirt from the company’s merch site in
anticipation of just this event. I’m going to wear it tomorrow.

But more seriously, as someone who has followed MoviePass since 2011 (I was
even on a panel at the Tribeca Film Festival with the OG founder/CEO,
something I forgot about until I found a photo of myself on Getty doing a
Google search), I’m sad that a startup that probably wasn’t ever going to work
flamed our this way, backed by a penny stock company that has all the
hallmarks of being involved in something really unsavory (I’m not saying
Helios & Matheson are con artists or involved in some sort of money laundering
scheme; I’m just saying I understand why people might ask that question).

The truth is, the MoviePass model would never work without partnership with
the theater chains (and possibly studios — tho that’s gets a little tricker
b/c of the Paramount Decree), and even then, that would only be temporary.
Even without Ted and Mitch intentionally trolling the theater chains, AMC and
Regal would ultimately figure out that If they were serious about a
subscription plan, it would make more sense to build it in house/keep it
limited to its own brands, rather than paying a middle man for customers that
might not have chain loyalty.

Stacy Spikes, The MoviePass founder and CEO (who was replaced as CEO before
the $10 plan launched and was then unceremoniously fired) is a great guy. I
was glad to read even all of this insanity has helped him raise money for his
next thing.

As for the other clowns, well, I’m thankful for the year plus of
entertainment.

~~~
parsimo2010
I think buying swag from startups to sell after they fail would be a better
business model than the moviepass model.

This was a classic case of, “we lose money on every sale, so we’re dropping
prices to make up for it in volume.” EVERYONE knew this was a bad idea, but
enough B.S. thrown into a slide deck convinced enough investors that this was
a smart gamble and not a clearly dumb one. Maybe the insiders knew something
that everyone else didn’t, or maybe they were pitching a quick exit, or
possibly just lying to their investors. Maybe in a parallel universe they
pulled it off.

But I’m still thinking how cool it would be to have a collection on
vintage/retro T-shirts from failed startups. You could even have a
subscription plan if it got big enough, or you could buy “options” from
startups to buy their remaining swag for a discount if they ever went under.

~~~
dreamcompiler
> I think buying swag from startups to sell after they fail would be a better
> business model than the moviepass model.

I wish somebody would start fuckedcompany.com v2.0. I used to hit that site
every day. Good times.

~~~
_jal
I still occasionally wear my fuckedcompany.com T-shirt. It is in the "laundry
shirt" stage, headed towards the "you must like that shirt a lot" stage.

Facial reactions to it tell me who was there at the time.

~~~
Scoundreller
And the SFW "luckedcompany.com" with the same backend but different theme.

------
ProfessorLayton
I would like to thank all the investors that greatly contributed to my
entertainment. It was a fun, and very unsustainable ride, but no regrets.

I'm actually considering the subscription service provided by the big players,
so they did change the industry somewhat.

~~~
sgarman
As someone who didn't have a movie pass I was too entertained watching this
whole thing play out. Venture subsidized products are always a wild ride. I
miss all my VC subsidized food deliveries.

~~~
kbenson
And who knows how much longer VC subsidized taxi services will last.

Now you've got me wondering, just how much wealth has been redistributed back
to the general public from failed VC backed schemes over the last decade?

~~~
Porthos9K
Not even close to enough.

~~~
OrgNet
I wonder if they knew that it would never work and were just feeling
"philanthropic"

~~~
abakker
I wonder if you could post hoc write it off as a donation to the public, and
deduct it from your taxes...

(I mean, I don't seriously wonder this, just hyperbolically)

~~~
jameslevy
You definitely can't write off a bad investment as a donation, but you can
write it off as a capital loss.

------
chipperyman573
"Helios and Matheson Analytics, MoviePass’ parent company, said it has formed
a strategic review committee to explore a possible sale of all or some of its
assets."

I'd bet money that anyone that downloaded the MoviePass app will shortly have
just about _aaaaaaaall_ of their data sold

~~~
ceejayoz
That was the original plan, even.

[https://www.marketwatch.com/story/moviepass-plans-to-make-
mo...](https://www.marketwatch.com/story/moviepass-plans-to-make-money-by-
selling-your-data-to-uber-eateries-and-hollywood-studios-2017-10-13)

> “It’s about the data,” said Ted Farnsworth, chief executive of Helios &
> Matheson Analytics Inc., which owns a majority stake in MoviePass.

~~~
nolok
I mean the company is named analytics inc., it’s not like they’re hiding it

~~~
krustyburger
Most users do not research the names of parent companies.

~~~
jhall1468
They also rarely read TOS, freely give out many pieces of identifying
information without reading privacy policies, and, as you said, do virtually
no research on a company or their ownership.

At some point consumers have to get _some_ of the blame here, right?

~~~
ceejayoz
Most TOSes and privacy policies require a post-graduate level of education and
several hours to properly understand - and that's for just one of the many
services we interact with daily. I don't think it's reasonable to put that on
the consumer.

~~~
SkyBelow
So do we throw out all basic contract law because of this?

I'm not being facetious here. I actually think that contract law has
significant problem in that it assumes a level of informed consent the average
person cannot give when dealing with corporations that have specialized legal
teams. It is one thing for two neighbors to enter into a contract since it is
a meeting of near equal minds. But the average individual and the entire legal
team of some large corporation? I would find a child entering into a contract
with an adult to be more likely to have informed consent.

~~~
baddox
“Basic” is a relative term. Any contract that was entered into by a party who
did not understand the contract and could not reasonably be expected to be
able to understand the contract should not be enforceable.

------
NoblePublius
Former MoviePass consultant here. Pretty sure the whole thing was a con. After
being hired, I quickly pointed out major flaws in the product that allowed for
users to share accounts or use their cards to buy popcorn or let theaters
arbitrarily charge MoviePass customers higher prices. Mitch was never
technical enough to comprehend the minutiae and Ted never acted with urgency
when confronted with cold hard evidence that his users were effectively
stealing millions of dollars from the company. They sold dollars for 75 cents.
Kind of like WeWork.

~~~
brainpool
What was the con exactly? Selling dollars for cents is not a con, it is
stupid. Different thing.

~~~
NoblePublius
Pumping and dumping their stock. Mitch and Ted both cashed out millions
directly as well. It’s all in the public filings, amazingly. Citron did the
best expose.

------
m12k
I hope this once and for all puts the nail in the coffin of the hand-wavy
"we'll collect info that is super valuable to someone else and sell it to
them" business model. Sure, if you can collect enough of it cheaply enough and
sell it cheaply enough to someone that can monetize it directly (e.g. selling
demographics info to ad networks for targeting) you might make it. But if
you're collecting this info at any sort of significant cost, then you have to
be able to monetize it yourself. Otherwise the 'purchaser' will just gladly
tell you in meetings how much they'll pay for the data, when in reality it's
just a super low risk way for them to see if this data holds any value for
them - if it does, they'll figure out their own way of collecting it and cut
you out of the equation. And more likely, it'll turn out not to be valuable
(or it'll turn out their organization isn't capable of acting on it) and
they'll just back out again.

~~~
sgt101
Yup. The model that works is to collect the data and offer services based on
your proprietary access to the data. Crucially you already need a business /
operant market for that to work. A good example is Sky in the UK where they
collect audience data and offer a targetted advertising (you tell us what kpi
you want to move, we choose the slots) model vs a standard (you choose the
slots that you want to buy) to monetize.

Upsides :

\- retain control of data

\- clear vs GDPR

\- proprietary knowledge developed

\- hard to replicate

Downsides

\- harder to set up

\- bigger up front risk for you

------
skizm
Not sure how ticket pricing works, or what sort of deals theaters could work
with the publishers, but if they had only sold tickets through moviepass after
the listed showtime, I feel like they could have made it work.

Moviegoers would really only be able to take advantage of less popular movies
and/or showtimes because buying the ticket so late risks a sellout or bad
seats (might not be able to sit near friends). The income would mostly be
gravy / found money for publishers because it would mostly be people who
wouldn't have gone otherwise. Moviepass might have been able to work out some
sort of rev-share based on number of tickets sold so they could guarantee some
income from each member's monthly payment. Hell this might even get you over
the hump into AOL / Planet Fitness territory where you're almost entirely
sustained by revenue from people who forgot they're paying for their
subscriptions (I assume this was always the ultimate goal for Moviepass).

~~~
covercash
People would quickly learn how to abuse that system by just waiting to
purchase tickets.

I think the theater+restaurant combos would actually be ideal for the
Moviepass model since they can offset the cost of the ticket with food/alcohol
sales. They could even limit it to 3 movies/wk like AMC and probably do well.
The theater+restaurant near me offers a $5 ticket Tuesday promotion and most
showings throughout the day are full. If they charged me $25/mo I’d definitely
pop in 1-2 times a week to watch a movie while I eat a meal.

------
rvz
Well, MoviePass also had a laughable security breach from what I recall from
the past month [0]. A password-less and unencrypted database exposed on the
net with user credentials in the millions all containing personal identifiable
information (PII), which sounds like a recipe for disaster and a fraudsters
dream. Well done if you dodged that slow moving car crash.

> MoviePass notified subscribers that it plans to close down the service
> because its “efforts to recapitalize MoviePass have not been successful to
> date.”

Good riddance.

[0] [https://techcrunch.com/2019/08/20/moviepass-thousands-
data-e...](https://techcrunch.com/2019/08/20/moviepass-thousands-data-exposed-
leak/)

------
paulpauper
It's pretty amazing how much attention the Movie Pass story has gotten. This
is a tiny micro cap company and stock that has garnered national media
coverage because its crappy business plan, which was doomed from the start,
predictably failed. And a lot of people used the service. In an era of web 2.0
companies that just burn endless cash but somehow keep chugging along (such as
Uber and dozens others), I think we all want to see a good failure story and
this one delivers. Maybe if they had integrated cloud storage or cloud video
or temporary workplaces or ride services into their business model somehow, it
would be worth billions now.

~~~
newshorts
They just needed autonomous movie viewing...

------
paul7986
There's another similar service for concerts and events.

Pay $40 a month to attend 3 concerts, sporting events or events in general. I
used it here in the DC/Baltimore area for concerts..live it. Though do wonder
how me paying $13 for a concert ticket vs. $50 to $60 they'll stay in
business?

It's called InWeGo...available in select US cities.

~~~
jandrese
That does seem a bit too good. For less than the cost of one ticket a month
you get three tickets? Is there some limitation like you can only get tickets
the day of (filling what would otherwise be empty seats) or something?

~~~
koboll
You can't reserve tickets until _5 days_ before an event, so I think it's
similar to other last-minute deal services -- filling unsold capacity.

~~~
rainyMammoth
yeah this is their business model I would guess. It's actually pretty smart
and might work.

------
luismmolina
Here in Mexico we have something similar. You pay $9.5USD a month and you have
unlimited access. This was before MoviePass and it is still working.

~~~
fludlight
In the USA the cost of a single adult movie ticket is ~$15. Charging less than
that per month for unlimited movies was puzzling.

~~~
thekyle
Depends on where in the U.S. where I am currently adult tickets are $11.

------
codyogden
Only MoviePass _would_ announce they are closing in less than 24 hours. Dodged
that massive bullet train wreck.

~~~
lozaning
Isn't their shutting down proof positive that what they were giving customers
was too good of a deal?

Where you considering working their or something? Otherwise how is not
purchasing something that's undervalued a train wreck?

------
thomasjudge
Lose money on every sale, make it up in volume…

~~~
bhj
They actually lost _more_ each time an existing customer used their product,
which is a bit of a red flag

~~~
benburleson
<thatsthejoke.bmp>

~~~
boffinism
Nope, the old sales joke is based on the idea that they lose the same amount
each time.

------
dawhizkid
The most interesting thing about this whole thing is how irrational the
_public_ market can be, especially at a time when there’s so much scrutiny on
private valuations. I don’t remember the highest marketcap the company reached
but it was skyrocketing at some point despite never really having pivoted on
its business model.

------
k3nosis
The GrooveShark of the movie industry. Thanks for changing the way we watch
movies.

------
cityzen
MOVIEPASS4EVER

Probably my favorite startup yet. If you're going to burn through millions of
VC money, may as well let everyone come along for the ride!

~~~
PorterDuff
It's hard to beat the Pixelon launch party.

Someone should really make a movie on that one.

~~~
cityzen
Oh do tell!?

Actually I found this on Wikipedia:

The history of the company has been used as an academic case study in the
study of corporate governance and ethics[14] and also as the subject in 2019
National Geographic's docudrama miniseries Valley of the Boom.

------
gravypod
When a company like this goes under where does all the code, configs, etc go?
It'd be cool to see how they threw it all together.

~~~
thepangolino
It gets sold of course. Unfortunately you need to be involved in the right
circles to have a shot at grabbing any of the IP. If you are lucky enough to
be in those you could grab it for as low as USD 1000.

~~~
gravypod
I wish I was in those circles. It would be really fun and informative to buy
up a bunch of the carouses of dead startups and do a code/architecture review.
What ideas did this team have that was interesting? What's confusing in the
code base? Would I repeat any of these things in the future.

------
dreamcompiler
Q: How do you know when an Internet bubble is about to burst?

A: When profits start to matter.

~~~
intopieces
Startups are not designed to be profitable on their own anymore. The dream is
not to be the next Google or Facebook. It’s to get acquired by Google or
Facebook.

~~~
skinnymuch
Recent tech IPOs have been amongst others: Pinterest, Crowdstrike, Zoom,
Fiverr, Upwork (as comparison to Fiverr), Uber, Lyft, Medallia, PagerDuty,
Tufin, Life360, Cloudflare.

A lot of these companies could be bought by a huge tech company, but they
can’t all be aiming for that, can they? Upwork and Fiverr likely never will.
Zoom is [a bit] profitable.

For other hyped startups like Airbnb and Palantir, they aren’t angling to get
bought out by an FB or Google either.

------
MagnumPIG
Funny sketch on this topic from CollegeHumor, about a year old:
[https://youtu.be/YBO_7UezpbY](https://youtu.be/YBO_7UezpbY)

~~~
hddherman
This one also describes the situation well:
[https://youtu.be/Ql3PGqUdcwg](https://youtu.be/Ql3PGqUdcwg)

------
brainpool
I’m most amazed that they started at all. The whole idea is just bonkers. Why
would cinemas give away free tickets to a third party so that they can make
recurring revenues that would siphon their own? No, and they didn’t. Even if
they would be as stupid as to go along with it, the first mover advantage for
MoviePass was so low as they could easily be outcompeted. I would love to see
the pitch for this pipe dream in the cloud.

~~~
intopieces
I thought the whole idea was to pivot to an analytics company? Not sure how
that would even work.

~~~
rightbyte
I can't see how so indirect consumer data as which theatre movies they watch
would be worth much.

------
liquidgecka
A few years ago I was accidentally emailed movie pass subscriber numbers Alo g
with a ton of financial information. (I have a very short Gmail address that
is a common fisrt and last name).. I didn't delve into the details too far but
the high level summary primed me to expect this day much sooner than it
actually ended up being.

------
coldtea
Should we see this as a business failing? Or as the founders, CEO etc making
lots of millions off of investors?

------
chooseaname
It gets bad on Friday the 13th. But it gets worse on Saturday the 14th!

Edit:
[https://www.imdb.com/title/tt0083033/](https://www.imdb.com/title/tt0083033/)

~~~
cityzen
Hahaha, I remember watching that movie when it came out.

------
pearjuice
What typically happens to all the intellectual property when a company like
this shuts down? Do the investors become shared right holders or something due
to lack of return?

~~~
Monroe13
IP assets are often sold at auction or in private transactions. Private equity
firms and patent licensing companies play in this space.

For example Fortress (now owned by SoftBank) cut a deal for Theranos’ IP:
[https://www.marketwatch.com/story/theranos-closes-deal-
with-...](https://www.marketwatch.com/story/theranos-closes-deal-with-
fortress-to-shut-down-embattled-firm-2018-09-13)

------
llamataboot
For every 100 people with great startup ideas and no access to capital,
there's at least 1 with an idea that will never work that gets funded I
suppose.

------
stjohnswarts
I really took advantage of this haha. A candle that burns twice as bright.

I stopped using it as soon as they started adding tons of gimmics and IFTTT
qualifiers

------
smashah
How you Americans mess up what's been working in the UK for years is beyond
me. (this post was brought to you by the Cineworld Unlimted Gang)

~~~
skinnymuch
That’s only at Cineworld theatres. MoviePass was at one point, most theatres
in the country.

AMC, the largest theatre chain in the world, has a successful subscription
service also limited to its chain.

------
basementcat
Someone should make a MoviePass movie.

------
lamdauf
I guess MoviePass is trying a free PR here, sorry OP, speaking of the devil is
some kind of PR.

------
xivzgrev
when the gravy train is running, hop on and ride as long as you can. Sometimes
like this it crashes and burns, sometimes like Uber/lyft it slowly Peters out
(and it’s still a gravy train, just not nearly as much so as before)

------
Kye
The tyranny of unit economics.

------
OrgNet
they lasted a lot longer then I anticipated

------
enahs-sf
Does this mean $HMNY will go back up???

------
austinl
I'd strongly recommend this longer read by Jason Guerrasio about the rise and
fall MoviePass: [https://outline.com/ZPqaXs](https://outline.com/ZPqaXs) —
really captures the whole story end to end.

Original link with ad-block paywall: [https://www.businessinsider.com/inside-
story-moviepass-rise-...](https://www.businessinsider.com/inside-story-
moviepass-rise-fall-2019-8)

------
aka2411
really sad news.

------
ijiiijji1
MP is like Uber and Lyft: a magical unicorn business model that consumers
thought they could get something for nothing, e.g., it was never sustainable.

