MoviePass Has a Risky Plan to Stay Alive: Make Its Own Movies
Ticket service MoviePass is down on the ground, but not out, thanks to its parent company’s acquisition of a production house that will allow for the launch of a MoviePass-branded production arm.
Helios and Matheson Analytics, the parent of MoviePass, announced the partnership with Emmett Furla Oasis (EFO) Films on Wednesday for an undisclosed sum of cash and stock. EFO, which has produced films such as End of Watch, Lone Survivor, and 2 Guns, will hand over its film library and upcoming production slate to Helios and Matheson. In turn, the two companies together will launch MoviePass Films to produce and distribute its own movies.
MoviePass, which allows subscribers to buy a movie ticket each day for just $9.99 a month, has made waves in the movie industry outside of ticketing. It announced MoviePass Ventures at Sundance in January and bought the distribution rights of its first film. Helios and Matheson then acquired movie listing and information service Moviefone in April. The moves, including the most recent one, all seem designed to give MoviePass a dynamic position in the industry in its quest to turn a profit.
But MoviePass’ ability to turn a profit remains the biggest question mark lingering over the service. Despite growing its subscriber count from roughly 25,000 to more than a million in 2017, MoviePass is spending a lot of money — fast. Earlier this month, Bloomberg reported MoviePass is sinking $21.7 million in the operation every month, with just $15.5 million in the bank. Helios and Matheson CEO Ted Farnsworth later said that MoviePass has a $300 million line of credit to keep the company afloat for 17 more months at the current rate of spending.
So, while MoviePass appears to be adding leverage to its position in Hollywood with its own studio, it’s still a dangerous game to double down with more expenses when there’s a clear deadline awaiting. But MoviePass CEO Mitch Lowe remains confident. “This signals our long-term commitment to the movie business,” he told Variety. “We’re here for the long haul.”