MoviePass is trying to save movie theaters, but it needs to save itself first

Movie theater attendance is the lowest it’s been since 1995. But a company called MoviePass is trying to fix that. Mitch Lowe is the CEO of MoviePass, but as the co-founder of Netflix, he’s partially to blame for movie theaters underperforming. “You know people have got to get out of this cocooning phase and into the experiential, “ says Lowe. A subscription to MoviePass lets you see a movie a day, for ten bucks a month. The math is simple: When MoviePass started in 2011, it cost up to $50 a month, depending on where you lived. At the time, the average price of a movie ticket in the U.S. was about $8, meaning you’d have to see seven movies a month to get the most out of your subscription. But the company dropped prices to $10 last August, about the average price of one ticket. For that, you got to see an unlimited number of movies each month. Not surprisingly, subscriptions jumped from 20,000 to over 3 million. Since the majority of movie-goers head to theaters just four times a year, the idea was to sign up as many of those people as possible to help subsidize those who are going many times a month, or even many times a week.

Then there's the data that the heavy movie-goers generate. “The reason we're able to offer you at extraordinarily low price is because we're going to monetize the data to sell you things to create kind of an Open Table for your night at the movies,” said Lowe “So we’ll be working with restaurants and bars and build deals, and of course we’ll make a percentage of the revenue that you would spend there.”

Despite Lowe’s confidence in the business model, the stock of MoviePass’s parent company, a big data company called Helios and Matheson (HMNY), is tanking to a current low of $00.11 a share. HMNY has unveiled a plan to raise a billion dollars from investors, and do what’s called a reverse stock split, which could temporarily boost the stock price. Shareholders will meet and write MoviePass's next scene — or its ending — on Monday.

This segment originally aired July 19, 2018 on VICE News Tonight on HBO.