It was always unclear to me why anyone who wasn't an investor or stakeholder should have cared that MoviePass spent/wasted a bunch of investors' money. If someone is selling dollar bills for 75 cents, who cares what their motive is, or if it's sustainable or whatever?
I think it wasn't so much about MoviePass per se as it was about the idea that MoviePass symbolized something broken in the modern economy -- that what it rewards isn't productive entrepreneurship that creates value by making life better for people, but rather burning tons of cash to wedge yourself into a position from which you can then extract rents from other people. The valorization of unnecessary middlemen.
From an HN comment from today that I've added to my favorites:
"It feels as though much of tech has gone from helping people accomplish their goals efficiently to a business model of extracting rents while providing no or little value."
I quote it because your comment made me think, "where have I recently heard that before?" :-)
The world has become this raging river of dumb money, and it’s a lot easier to simply find the biggest cup you can find and dip it in, than it is to actually create something of value and sell it to actual people.
How are the movie theaters supposed to undercut somebody who is deliberately losing money on every transaction, without driving themselves out of business?
This is the new VC-funded business model: you use cash as a kind of anti-gravity machine, letting you do things no competitor would do because they aren't economically rational. The bet is that, if by defying gravity you can reach a monopoly position, you'll end up making back all that cash and more. But as MoviePass demonstrated, once the cash dries up and gravity starts applying to you again, if you haven't reached that monopoly position, the fall is quick and painful.
> This is the new VC-funded business model: you use cash as a kind of anti-gravity machine, letting you do things no competitor would do because they aren't economically rational. The bet is that, if by defying gravity you can reach a monopoly position, you'll end up making back all that cash and more. But as MoviePass demonstrated, once the cash dries up and gravity starts applying to you again, if you haven't reached that monopoly position, the fall is quick and painful.
the next decade will be defined by the failure of these anti-gravity tricks
> How are the movie theaters supposed to undercut somebody who is deliberately losing money on every transaction, without driving themselves out of business?
Patience. Someone deliberately loosing money on every transaction will go out of business very quickly.
(And, apparently this is what happened to Moviepass.)
Remember, Moviepass bought the tickets from the theaters, so it's not like the theaters lost money waiting for Moviepass to go out of business.
But that's Levine's point, that there is a sense in which MoviePass didn't fail. Oh sure, it went out of business, but the fact that it flamed out spectacularly isn't hurting the careers of anybody who was involved with it. In fact it probably enhanced their careers, since being associated with a splashy, heavily-covered story turned them into a weird sort of business celebrity.
Anyone who can start a local pizzeria and make it consistently profitable is a better businessperson than any of the people associated with MoviePass are. But our culture rewards bigness, whether in success or in failure, much more lavishly than smallness, so the MoviePass alums find the doors of the VC world flung open to them, even though the only thing they're known for is failing.
The only guy who’s cited by Matt as being career-enhanced by MoviePass is the guy who started the company, not the guy who came up with the much-too-low 10 Dollar subscription later on.
Many people worry too much about things that don't hurt/help them. This pops up a lot in politics as well, with people arguing for/against things that would not change their life at all. I think it's just human nature to pick a side and adopt that side's strong opinions. People like to argue, and arguing for/against the interests of popular billion dollar multi-national companies is an exceedingly risk-free argument to engage in.
In the case of MoviePass, the only concern I'd have is if they closed shop suddenly after I've already paid for a month of service. But if they stayed open long enough, it doesn't matter. I might have lost $5 but I saved $50 over the course of my membership.
Why worry about crime when you’re not the victim? Because not constantly screwing each other over whenever possible is the fundamental basis for society. When somebody is pulling an obvious con, it’s reasonable to be concerned even when you’re not the target.
I worry about crime when it impacts the victims. I worry less about crime when there are no victims or when the victim does not feel the impact.
A person getting mugged on the street and then not being able to pay his rent is worth worrying about. A billionaire being scammed out of $100,000 is not. The users of MoviePass being scammed would be terrible. The VCs being scammed is the cost of doing business.
>I worry about crime when it impacts the victims. I worry less about crime when there are no victims or when the victim does not feel the impact.
MP has consistently lied to their customers about movie availability and made it extremely difficult/impossible to cancel subscriptions. They are also a publically traded company with no viable business model.
Unfortunately, it does concern you because public pension funds are investing in venture capital funds. If the pension funds lose money, you are going to be on the hook to make up the difference as a taxpayer.
In that case, everything impacts me and every argument I engage in should be a life or death argument.
In reality, it's not worth my time to argue if my taxes go up 25c per year or only go up 10c per year. Just writing this short comment has cost me more in dollars-per-hour than the difference in public pension fund taxes would.
Their are plenty of cities with massive unfunded pension liabilities that are causing services to be cut, less policemen hired, less firefighters, larger classroom sizes, and/or much higher property taxes.
And I'm sure there are more complex factors that go into that than MoviePass going out of business?
I'm not against arguing about things I can't control (check my comment history or just ask dang) but it's purely entertainment. If you or I want to affect change in that regard, MoviePass or even the VCs who fund it is the exact opposite of where that argument needs to start.
Interesting direction to take it, but I was thinking more like, HNers seem almost offended when someone's business model doesn't work how they think it should. If their runway isn't coming out of your bank account you really shouldn't care.
If you view VC investments as a zero sum game then you could be justified in being upset that someone is wasting money that could be financing your company instead. I haven't heard anyone make that argument, however.
I got burned because I paid for a year but they made their service intentionally unusable before I "made money" on the deal. But I new the risk going in, so that is one me.
But I a lot of people paid for a year and then got 1-2 months service before being cut off. That's basically a scam unless you claim VC immunity.
>If someone is selling dollar bills for 75 cents, who cares what their motive is, or if it's sustainable or whatever?
People who don't want to encourage fraud, e.g. con-men telling people about some great opportunity to invest in, and then living off of their dollars, while selling the rest for 75 cents to buy time and appear as "successful"?
> who cares what their motive is, or if it's sustainable or whatever?
Broadly speaking, when average Joe investors get burned, the public tends to pick up the tab. Whether through public prosecution, unemployment benefits, or the other consequences of a nuked nest egg. MoviePass didn’t get to those levels, but there is a rational reason to be wary of things that look like fraud in our system.
A bunch of movie industry types were worried that MoviePass was "devaluing" their product, but I agree consumers should just be laughing all the way to the bank (or the theatre, in this case).
That isn’t a false premise though - look at what a few tech companies trying to undercut one another did to the music industry. Not that artists were making the money before Spotify, but there was a lot more money in the system then than there is now.
There was a lot more risk and costs too, hence limited supply, hence higher prices. You can't shift the supply curve to the right and expect prices to not move.
I don't know about Spotify's free-tier economics, but personally, I spend a lot more money on music, thanks to a-la-carte subscription services, then I ever did prior to it.
If the artists negotiated taking 0.01% of the revenues from it, with the subscription services taking 30%, and the record label taking the other 69.99%, that's not exactly my problem. I don't pick which record label said artists sign with.
Before music moved online and to subscriptions, I was buying 2-3 CDs a month on average. That's $45/mo in 1990s money.
Today I subscribe to Spotify for $10/mo and buy maybe 2-3 CDs (or their equivalent in one-off songs) a year.
Maybe they make it up on volume but I'm certainly getting a better deal now than I ever did back in the day.
1) MoviePass claimed they would make up the difference by selling data. The press repeated this over and over again, as if the "selling $1 for $0.50" could be solved.
2) When companies like Uber can go public, after years of economic analysis saying they can never be profitable, and companies like MoviePass get positive press, it shows that either something is broken, or there is an opportunity chasm opening for those in the know.
