MoviePass Had 2 Million Subscribers, but How Many People Use It?

Douglas A. McIntyre

There has been a great deal of debate about whether MoviePass, the subscription plan that allows people to get movie tickets at a discount, is a success. Its subscriber count moved past 2 million, but it is not clear how many of those subscribers use the service or whether they will use it long term.

The press release read:

Less than one month after announcing its milestone of 1.5 million subscribers, MoviePass™, the nation’s premier movie theater subscription service and a majority-owned subsidiary of Helios and Matheson Analytics Inc. (Nasdaq: HMNY) announced today that MoviePass™ has exceeded 2 Million Subscribers.

“We’re giving people a reason to go back to the movie theaters and they’re going in droves. With awards season here, we hope we can make Hollywood and exhibitors very happy by filling seats with eager audiences.”

The weak point of the comments is that they do not have context, which means that “droves” means little.

Wall Street does not, for the most part, believe in the future of the parent. Helios and Matheson Analytics Inc. (NASDAQ: HMNY) shares trade at $8.34, down from a 52-week high of $38.86. The shares have been besieged by short sellers, many of whom think the company should not be in the movie business at all. It is an IT consulting firm, and MoviePass has nothing to do with its core business.

MoviePass also has been in fights with theater chains about the service. In particular, MoviePass removed several AMC Entertainment Holdings Inc. (NYSE: AMC) theaters from the service. MoviePass cannot flourish unless it has good relationships with most theater owners.

The largest question about MoviePass is how many of the people who sign up for the $9.95 a month service take advantage of it. Two million is a large number, unless many of the people are disappointed with the service and do not continue to use the plan. One of the most prominent features on the MoviePass homepage is a search box for theaters that use the service. MoviePass says it is accepted at 4,000 theaters.

Helios and Matheson Analytics has yet to offer any data that show how MoviePass does financially. The fact that it has 2 million subscribers does not mean much.