Movie subscription service MoviePass today confirmed that it will soon introduce surge pricing into its business model, charging customers from $2 and up for films that the company deems popular. The news comes from MoviePass CEO Mitch Lowe, who confirmed to Business Insider that surge pricing will affect monthly subscribers while annual subscribers will be exempt from what he describes as "high-demand" pricing.
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The change will appear for affected subscribers within the "coming weeks," according to Lowe. Surge pricing is a dynamic, time-based strategy that apps like Uber use when a large amount of customers are requesting rides in the app but there aren't enough drivers to taxi them around.
Now this will extend to MoviePass, so on opening weekends or at particularly busy late-night showings of popular movies, monthly subscribers should expect to pay a bit more above their locked-in $9.95/month subscription price. Because this is not a fee that the movie theater is charging, users can expect MoviePass to take the surge pricing fee from the credit cards associated with their account -- although Lowe or any MoviePass spokesperson has yet to confirm this.
"At certain times for certain films — on opening weekend — there could be an additional charge for films," Lowe told Business Insider.
Lowe said this decision was a way to have its theaters partners see more traffic for big blockbusters in the mid-week and less-crowded weekends following the movie's opening weekend. It was also to "make sure that we can continue to offer a valuable service and support the whole enterprise," Lowe added.
Otherwise, there are two other additions coming to MoviePass this summer: a bring-a-friend feature and IMAX/3D screenings. In the MoviePass iOS and Android app, subscribers will be able to add on a ticket for a non-MoviePass friend, the cost of which will be "somewhere near the retail price of the ticket."
For IMAX and 3D movies, users will be given the option to pay an added fee for the premium screenings, ranging from $2-$6 according to Lowe. As of now, one of MoviePass' detriments is that it only allows subscribers to watch regular 2D movies. At launch subscribers will have to choose one of these features or the other for a single film, but eventually they will be able to combine premium and bring-a-friend options for the same movie.
The MoviePass news comes after AMC just yesterday revealed its own movie subscription service, which will let customers watch three movies per week for $19.95 a month -- including IMAX and RealD 3D showings. Lowe responded to this new rival service today as well:
"It's been tough when you have the president of AMC essentially for eight or nine months telling everybody that our subscription was not sustainable, and then he comes out with a program that essentially could cost him $60 or $80 a month to pay the studios their minimums and collecting $19.95," Lowe said, referring to AMC CEO Adam Aron. "So it is a little bit kind of funny that it's pretty clear what he wanted to do — clear the way for his own subscription program and not have competition."
All of the new MoviePass features -- including surge pricing -- will appear in the MoviePass app by the end of August.
Top Rated Comments
My list of reasons to NOT go to a theater to see movies is already pretty long. Expensive tickets, annoying patrons playing/talking on phones while kicking your seat, $10 popcorn, huge lines for popular movies, etc.
Their solution: Make it more expensive.
Me: Nope. Blu-Ray and 4K, thanks. I can wait 2 months and buy the disc for less than the total cost of the "theater experience."
This just made the amc service a lot more appealing
The changes are definitely annoying, but none of them are deal breakers for me yet. My wife and I decided we just won’t watch movies opening weekend now to avoid that extra cost. Plus, we already didn’t watch most movies opening weekend anyways, so it’s almost a non-issue.
I guess the option to watch 3D/IMAX for an added fee is good news for some. I’d possibly watch a few movies a year in 3D if the premium isn’t too much. But 2D’s been fine for us, so that isn’t an issue either.
What we’d like is a family pass feature, so we could just use one card for two tickets, and get charged a single amount for it, instead of separate charges like it is now. Either way, it’s still working out, and it’s understandable that they keep changing the program to try to find a more sustainable business model.