Major Movie Studios Are Investing $50 Million in This Startup
Three studios are investing in a new app that they hope will make movie theater outings more popular.
With more movies available to stream online, less people have been dishing out money to actually go to a theater. Ticket sales have subsequently fallen over the past decade. The Wall Street Journal reports that Walt Disney Co., Twentieth Century Fox, and Lions Gate Entertainment Corp. are putting $50 million into Atom Tickets to bring those sales back up.
The 20-person startup made its app available in three test markets in April 2015 and plans to launch nationwide this summer, given that it partners with more theaters by that point. It is currently working with Regal, Carmike, and Landmark Cinemas—the No. 1 and No. 4 U.S. theaters, and the No. 2 theater in Canada.
The app makes it easier for groups to organize outings by polling friends about movie preferences and availability, and offering suggestions based on their answers. They can then purchase blocks of split the cost through the app. With a theater’s consent, it also offers discounts based on how many tickets are being bought or the popularity of the movie. Atom makes its revenue from ticket surcharges, a cut of concession preorders, and advertising on the platform.
Carmike CEO David Passman said that theaters using the app have sold more tickets and refreshments than similar theaters in different cities, though Regal’s CEO David Ownby told the Journal it’s too early to determine the app’s impact on sales.
Atom could prove to be fierce competition for Comcast-owned Fandango, which has essentially controlled the market since entering it in 2000, though the website has taken steps to increase sales as well, including partnering with a video-on-demand service to offer movie downloads along with tickets.