If you were hoping to use your MoviePass to catch some of summer’s biggest blockbusters this weekend, you may be out of luck. Following a troubling new report from Business Insider, the flailing subscription service announced Tuesday that it would be upping its monthly subscription fee over the next 30 days and limiting tickets for major releases for their first two-week theater run.
On Monday, MoviePass’s CEO, Mitch Lowe, reportedly called an all-hands meeting after the app faced technical difficulties over the weekend. Lowe apparently announced that the subscription service wouldn’t be offering tickets for Christopher Robin, the upcoming Winnie the Pooh feature, or The Meg. But even if you weren’t super eager to see Jason Statham and Rainn Wilson chase down a big-ass shark, MoviePass subscribers will now have limited or no access to major blockbusters—any film opening on 1,000 screens or more—in the first two weeks after they open.
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It’s just the latest change the company has had to make to its business model, which originally charged users around $10 a month or $89.95 for the year to see one free movie per day at most theaters in a deal that costs the company a lot of cash. Now, it’s planning to hike up that monthly fee to $15 for the foreseeable future.
Although MoviePass’s parent company told VICE losing money was all part of the plan in the short term, it’s already proven to be unsustainable. According to Business Insider, the app completely shut down last Thursday after the company temporarily ran out of money and had to borrow $5 million to keep it up and running. Then over the weekend, some users found that they just weren’t able to use their MoviePass to buy tickets to Mission: Impossible—Fallout, one of the biggest releases of the summer.
The company has already announced a new “surge pricing” plan that would require monthly subscribers to pay a little extra for more popular titles at peak times, but it’s not clear how the hike in the monthly subscription fee or the inability to see major blockbusters on opening weekend will affect that plan. According to Tuesday’s announcement, the company is planning “continued rollout and refinement” of its peak pricing plan.
“We believe that the measures we began rolling out last week will immediately reduce cash burn by 60 percent and will continue to generate lower funding needs in the future,” Ted Farnsworth, Chairman and CEO of Helios, said in a statement.
Still, even if the company, which already loses an estimated $20 million to $40 million every month, stands to save some money from the new measures, the constant tweaks to its business model only go to show that sometimes when a deal seems too good to be true, it probably is.
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