Solving The Subscription Movie Formula

The appeal of a subscription service like MoviePass is obvious. Movie tickets are expensive: The average price of a ticket for a non-matinee in 2018 was $9.11, and as a result most Americans don’t go to the movies all that often — fewer than 10 times per year. A service that offers — as MoviePass has (on and off) — unlimited movies at the theater of one’s choice for a flat $9.99 per month? What’s not to love?

For MoviePass, the answer to that question turned out to be the ways in which the service was used that caused it to be a massive money loser. Without any special partnerships in place with theater operators, MoviePass was selling subscriptions for $10 a month, but purchasing the movie tickets themselves for $9.11 a shot. Customers who started seeing lots of movies every month caused the company to bleed funds, announce and unannounce various changes to its platform and on the whole struggle on the edge of survival as a firm.

And while MoviePass has attracted a lot of press in the last year with its dramatic swings, it isn’t the only player in the movie theater subscription line struggling. Sinemia is a subscription service similar to MoviePass, but it offers two tickets for $9.99 per month and unlimited films for $15 a month. It has been struggling with customer complaints and a class-action lawsuit over the way it treats customers, according to reports. Most complaints are about either hidden fees, cancellations with no refunds or problems with the company’s app. The lawsuit against Sinemia, which was filed by Chimicles Schwartz Kriner & Donaldson-Smith, alleges that “Sinemia fleeces consumers with an undisclosed, unexpected and not-bargained-for processing fee each time a plan subscriber goes to the movies using Sinemia’s service.”

The announcement by Atom Tickets earlier this month that it was jumping into the wild world of movie theater subscription plans was head-turning, given what a fraught path it has turned out to be for others. But Atom’s take on the idea is different in that it is working hard to play well with others — specifically theater operators.

Atom’s new service will, in essence, let operators build their own, personalized movie subscription platforms using Atom Tickets’s infrastructure and technology.

Chris Brucia, head of product for Atom Tickets, told PYMNTS the move was a natural outgrowth of its long study of the market, which revealed two things: Consumers are obviously interested in subscription products, and trying to build a one-size-fits all solution to impose on theater operators isn’t going to be viable.

“Creating the ability for exhibitors to offer their own subscription plans that can co-exist with a la carte ticketing as well as the unique features of Atom like social invites and pre-ordering concessions felt like the most organic and additive way to work with theater chains that want to put an offering out there,” Brucia said.

Exhibitors, Brucia noted, set the prices, which means they are always going to be a natural starting point to build a subscription service that is sustainable over time. Moreover, he noted, Atom is betting that theater operators actually have a good incentive to want to build these kids of programs — and bring more customers in.  Particularly, Brucia said, when they see these kinds of programs can exist alongside their a la carte ticket sales.

But, he noted, building a subscription platform is not a technological feat that many of those operators went into businesses hoping to pursue. Atom Movie Access comes with that technical infrastructure — and makes it easy to offer up a branded subscription service that checks their boxes in terms of pricing.

“We’re all about getting people to the movies more often,” Brucia said, noting that is the goal that informs everything the platform offers today, like reserving seats, or pre-purchasing concessions. Subscriptions as an addition, he said, enhances that core functionality.

“However, moviegoers that opt for a subscription plan or plans get to make use of these features when booking showtimes for themselves and friends or family they’re headed to the movies with,” Brucia said.

Whether any movie theater operators will take them up on this offering remains to be seen. Burgia noted that Atom is already connected to dozens of theater partners nationwide as it provides ticketing capability for 22,000 screens.

As it stands, “We are currently in conversations with various interested partners and will share more details when we can.”