MoviePass Revival: Why the Co-Founder Bought Back the Brand

MoviePass Reborn: Co-founder Stacy Spikes Acquires Beleaguered Brand

Breaking news emerged yesterday regarding the MoviePass brand; Stacy Spikes, a co-founder of the service, has completed the purchase of the company for an undisclosed amount. This acquisition follows what many consider a particularly notable failure within the technology sector.

The original service experienced difficulties stemming from fluctuating subscription costs, negative reactions from major cinema chains, and significant problems with its mobile application.

Spikes' Previous Departure and Future Plans

In an interview with TechCrunch, Spikes revealed he was terminated from MoviePass in 2018 after expressing reservations about the pricing of its $10 per month subscription plan. He attributes this to a series of decisions made under the leadership of Helios and Matheson, which ultimately contributed to the company’s downfall.

Earlier this year, Spikes launched PreShow Interactive, described as a platform allowing gamers to earn in-game currency by viewing advertisements. He suggests that PreShow could be integrated into a revitalized MoviePass, potentially launching sometime next year.

Challenges and Uncertainties Ahead

The future of MoviePass remains uncertain. The immediate priority is securing access to the service’s existing code and other essential assets. Spikes also intends to gauge consumer interest to determine if a return for MoviePass is viable.

Given the ongoing struggles of the film industry to attract audiences following the global pandemic, the timing could be opportune for a revised movie ticket subscription model.

Industry Parallels: Lessons from the Music Sector

TC: Your background in the music industry may have provided foresight into the transformations the movie industry is currently undergoing. It served as an early indicator of significant disruption within the broader entertainment landscape.

SS: The rise of subscription services like Napster, Pandora, Spotify, and Rhapsody demonstrated a clear trend. You are correct; the music industry was the first to experience this shift.

Netflix benefited from the groundwork laid by these music subscription platforms as they transitioned from DVDs to digital distribution. This marked the initial phase of digital dominance and fundamentally altered the industry.

The Original Vision for MoviePass

When you initially conceived MoviePass, did you perceive a need to challenge the traditional theater model, similar to how these services disrupted the music industry?

As one of the few executives from a minority background, I established the Urban World Film Festival to provide a platform for filmmakers of color. This festival launched the careers of Ava DuVernay, Malcolm Lee, Tim Story, and Lee Daniels.

Our initial concept was to create a circuit for independent films that struggled to gain traction in mainstream theaters. We envisioned a subscriber base and a system allowing members to access theaters seamlessly.

The idea evolved to encompass all independent movies, and the concept continued to develop from there.

Divergence from Helios and Matheson’s Model

How did your vision for MoviePass differ from the approach ultimately implemented by Helios and Matheson?

During my tenure as CEO, we conducted price testing ranging from $15 to $90, constantly analyzing the optimal balance between profitability and affordability. We understood the financial limitations of excessively low pricing.

The key difference was our awareness of these financial constraints. When Helios and Matheson took over and dismissed me, asserting that I disagreed with their vision, the company’s trajectory changed. I was removed from the board within months.

The Core Reason for MoviePass’s Failure

What were the primary factors contributing to MoviePass’s failure?

Ultimately, the chosen price point was unsustainable. This is a straightforward truth, requiring no further complication.

Technical Issues and Intentional Disruptions

Beyond the pricing, there were technical issues, including frequent shutdowns, that caused significant frustration for users.

These were not technical malfunctions; they were deliberate actions. When I was CEO, the MoviePass app functioned flawlessly, providing a user-friendly experience. Members could easily access any theater, with a footprint larger than Fandango and Movie Tickets combined.

We dedicated years to perfecting this simplicity and ease of use. The issues that arose afterward were intentional, such as the decision to remove AMC Theaters or the app’s intermittent functionality.

[Editor’s note: As previously reported, the FTC accused MoviePass of deliberately restricting consumer access to the service and failing to adequately protect their personal information. MoviePass reached a settlement with the FTC last month.]

Re-engaging Theater Chains

Do you anticipate attempting to collaborate with major theater chains again?

My objective is to support the revitalization of Hollywood and moviegoing. I believe there is potential for subscription plans tailored to specific exhibitors, as well as options for subscribers who prefer broader access to multiple theaters, potentially at a higher price point.

We are committed to driving movie attendance and believe that subscription models can significantly benefit the industry.

The Value of the MoviePass Brand

Do you believe the MoviePass name still holds enough positive recognition to justify its continued use? Is it a strategic move to relaunch under this banner?

The question is whether consumers associate the MoviePass name with the company or with the five years of the brand that followed. My observation is that those who signed up before 2017 recognize the distinction.

They understood our original vision and appreciated our underdog status as we strived to create something unique.

Why Revive the MoviePass Brand?

Why choose to revive the existing brand rather than starting anew?

Looking at examples like Apple after Steve Jobs and Dell after Michael Dell, founders often return to companies they built, fighting to reclaim their vision. I began working on MoviePass in 2005, dedicating 16 years to its development.

There is a strong personal connection to something you’ve poured your heart and soul into. While a name change is possible, we plan to gather feedback and explore all options.

Potential Relaunch Timeline

Reports suggest a potential relaunch timeframe of the third or fourth fiscal quarter of 2022. Is this accurate?

Numerous factors must align. We are exploring all possibilities, considering industry support, consumer interest, and studio involvement. If there is a widespread belief that movie subscription is a flawed concept, we may reconsider.

However, if stakeholders are open to a solution that benefits the industry as a whole, we will pursue it.

Integrating PreShow Interactive

The PreShow website initially indicated a launch in summer 2021. What is the current status?

We are exploring the possibility of integrating PreShow into MoviePass. The goal is to find a home for PreShow and potentially leverage its features to reduce costs within the MoviePass framework.

This could involve a freemium model, a supplementary option, or a user-selectable choice.

The Future of PreShow

Will PreShow exist in its original form?

It’s possible that its features could subsidize the cost of movie tickets.

That is a possibility. Alternatively, it could reduce a subscriber’s monthly fee rather than directly subsidizing ticket prices.