The embattled MoviePass is taking out all the stops to survive.
MoviePass CEO toldThe Wall Street Journal in an interview published on Monday that the company will begin limiting its customers to seeing only three movies a month. In the interview, CEO Mitch Lowe said that the move, which will take effect on Aug. 15, will cut more than 60% from MoviePass’ burn rate and ease some of its pain points as it works to turn its operation around.
MoviePass has more than 3 million subscribers. The service allows you to pay a monthly subscription fee to attend movies at local theaters. At $9.95 per month, MoviePass is significantly cheaper than a single movie ticket. And even after one movie, it’ll pay for itself each month.
Still, MoviePass has been dealing with countless problems of late. The company has been experiencing a cash crunch due to heavy costs associated with running its business. The service briefly shut down before it was able to borrow money. Now, it’s trying to figure out how to make such a cheap monthly subscription service work in a world where ticket prices are rising and MoviePass doesn’t get a cut from theater concessions to offset some of its costs.
In his interview with the Journal, Lowe said that 85% of MoviePass customers go to movies three or fewer times per month. Those who want to see more than three movies a month will need to pay for each ticket. MoviePass will, however, offer a discount of between $2 and $5 on each ticket customers purchase inside its app, according to the Journal.