MoviePass: Fallout

Just when you think MoviePass is dead and gone, The Ringer publishes an interview with MoviePass CEO Mitch Lowe and Executive Vice President Khalid Itum, where they detail their struggle to keep MoviePass afloat. At one point Itum remarked that the weekend Mission Impossible: Fallout came out was when they realized “…that we can’t necessarily provide the service we had been providing..."

You don't say.

My argument, from the beginning, was that MoviePass was an interesting idea, but one that was poorly thought out and poorly implemented. The fact that they didn't realize this until almost one year after announcing their "Unlimited Movies for $9.95 Plan" is, sadly, unsurprising.

“Over 80 percent of subscribers were great customers,” says Lowe—“great,” in this case, meaning rule-abiding and low-frequency. “We were roughly breaking even on that group.”

Like gyms at the start of every new year, MoviePass was banking on generating revenue from people signing up for the service and then never using it. But given the cost of the monthly subscription and the average cost of a movie ticket in the United States, I’m surprised that they were breaking even on 80% of their consumer base. The teensiest amount of research would have warned them about frequent moviegoers. They account for 48% of ticket sales in the domestic market and not only would they be the most interested in a theater subscription service, they would be the ones who would benefit the most from it. Or, to borrow Lowe’s own parlance: not great customers.

I, for one, fell into that ‘not so great’ category of customer. Then again – and I’ll admit this is entirely anecdotal — I ran into many people in LA who signed up for the service, and immediately began to see movies on a weekly basis. At $9.95 a month, MoviePass was cheaper than a matinee ticket at most area theaters, and you could go (almost) as much as you wanted. As analyst Michael Pachter noted when interviewed for the article:

“Nobody was dumb enough to sign up for MoviePass and not use it.” When I ask Pachter what MoviePass’s biggest mistake was in 2018, he doesn’t hold back: “Their biggest mistake was launching.”

But not only did they not think through how their customers would use the service, they apparently didn’t think through how they should approach the exhibitors.

MoviePass fashioned itself as a disruptor, and thus, behaved disruptively. It demanded that exhibitors share profits with it on concessions; it demanded exhibitors provide discounts on tickets; boasting its marketing heft and ability to push users toward specific movies, it demanded deals from distributors.
What they failed to anticipate, for some reason, was the way the industry—both exhibitors and distributors—responded to this behavior. “The cinema business is quite a small business actually,” says David Hancock, the director of research and analysis for cinema and home entertainment at IHS Markit. “It’s a relatively restricted number of people in there, and they know each other relatively well. You often get outsiders coming in, not understanding the business, and [they] say, ‘We’re going to impose this on you guys.’ Each time this happens, the business closes ranks. [And] the way MoviePass came in, they were just asking to be isolated.”

As I wrote way back when: “[the exhibitors hesitance] doesn't mean that the exhibition industry isn't prime for some disruption, just that MoviePass needs to prove that it's the way to do it.” And evidently they did. But pissing off the distributors and exhibitors while doing it isn’t exactly the path to success. The history of MoviePass can be described as a a seemingly unending series of poor executions around a decent idea. And, as a user, that was evident from the beginning.

There is a UI design philosophy that Apple codified back in the 1980s on the Mac —one that is still used today on both macOS and iOS. You probably haven’t noticed it, but pay attention the next time you are prompted to choose ‘Yes’, ’Okay’, or ‘Confirm’. There’s a really good chance — as in 99% or higher — that those options will be on the bottom right of the dialogue screen. This means, assuming that the program adheres to the design philosophy that is suppossed to be implemented universally across the system, you shouldn’t need to read the options. You would instinctively know where it is: The bottom right.

When I first signed up form MoviePass, I kept running into an error where I would input my MoviePass card number into the system, and it would cancel out. I did this multiple times before finally realizing my error: The ‘Confirm’ button was on the left, not the standard right.

When I complained to my friends, they laughed and — fairly — pointed out that it was my fault for not reading the dialogue box. But that was beside the point. In a properly designed app, I wouldn’t need to read it.

MoviePass: Poorly thought out and poorly implemented, through and through.