MoviePass needs to, and it'll be raising prices and limiting new movies to do so.
In a Tuesday announcement, the company said it has so far reduced its costs by 60 percent and will take more measures to keep afloat. The plan to make this happen: raise the service's cost to $15 a month in the next 30 days and limit availability for new, major-release movies during their first two weeks at the box office.
The changes come nearly a year after MoviePass, which at the time let customers see one movie a day as long as it was a 2D screening. Before that, MoviePass could cost anywhere from $15 to $50 a month depending on a customer's plan or region.
MoviePass said Tuesday that its service now has over 3 million subscribers and is "generating incremental non-subscription revenue of approximately $4 to $6 per subscriber per quarter." MoviePass said this money comes from marketing efforts, thethat adds surcharges to some screenings, various promotions and .
Despite that, the company ran out of cash on Thursday, resulting in a four-day period, an and a then-unannounced blackout of the major release of . MoviePass confirmed Tuesday that the new Tom Cruise movie is the first film under the new policy of limiting major releases, which the company says can be avoided should a studio decide to "partner" with the service. That probably translates to pay for it to be available to customers.
"This is a strategic move by the company to both limit cash burn and stay loyal to its mission to empower the smaller artistic film communities," reads MoviePass' announcement about the new policy. "Major studios will continue to be able to partner with MoviePass to promote their first run films, seeding them with a valuable moviegoing audience."
MoviePass has always been a bit too good to be true. The $10-per-month subscription fee is often cheaper than the price of even one ticket to the movies, especially in major cities where a 2D screening can be as high as $17.
Seeing MoviePass adjust its plan and policies to help cut costs isn't at all surprising. Customers however were not made aware of the policy change for new releases before last weekend, leaving many to take out their frustrations on the service over the weekend without that information.
Meanwhile other companies are touting their own competitors to MoviePass, which include upcoming entry from Alamo Drafthouse. AMC in particular announced Tuesday that their $20 service that includes 3 movies a week now has 175,000 members signed up since its launch five weeks ago., and an
First published July 31 at 7:54 a.m. PT.
Update 8:32 a.m. PT: Adds more details.