Future of MoviePass Remains Murky as Regal Prepares Rival Subscription Service

The future of MoviePass remained unclear after the busy holiday moviegoing weekend in the U.S., one dominated by Sony’s “Spider-Man: Far from Home.”

The once-promising movie theater subscription service wasn’t able to take full advantage of the latest Marvel film’s release just ahead of the weekend because MoviePass was taken offline effective 5 a.m. ET July 4, according to the company.

MoviePass was “temporarily interrupting its service for subscribers in order to complete its work on an improved version of the MoviePass mobile application based on an enhanced technology platform,” the company said in an announcement.

Subscribers weren’t being charged during the interruption period and will be automatically credited for the number of affected days once the service continues, MoviePass said, adding new subscribers wouldn’t be enrolled in the service while it was offline.

There’s never a good time to have to do this,” MoviePass CEO Mitch Lowe said in a statement. But he added: “To complete the improved version of our app, one that we believe will provide a much better experience for our subscribers, it has to be done.”

The company also planned to use the time offline to “recapitalize in order to facilitate a seamless transition and improved subscriber experience once the service continues,” it said.

In a message at the MoviePass website, the company said it had been “working hard to improve” its subscription service to “ensure it meets the vision that we have for it.”

However, with Regal Cinemas reportedly set to announce details of its own subscription movie theater service, AMC Entertainment continuing to find strong success with its A-List subscription service and Cinemark also continuing to report promising results for its own subscription service, it remains questionable just how much room there is in the market for an improved MoviePass service. Especially when one factors in the many subscribers that MoviePass lost over the past several months.

MoviePass updated its monthly subscription pricing yet again for 2019, with a three-tier structure in which pricing varied depending on where the subscriber was located and the types of movies that each customer wanted to see. The announcement followed several months of complaints from MoviePass subscribers, after the company started significantly limiting the movie options that members could see at their local theaters on any given day.

The announcement also followed an increased number of competing subscription plans, including most prominently AMC Stubs A-List.

But, in announcing plans for the new and improved MoviePass July 3, Lowe said: “We have listened and we understand the frustrations of our subscribers. To provide the level of service you deserve and we can be proud of, we need to improve our mobile app. We plan to make this improvement by utilizing an enhanced technology platform, which is in the final stages of completion.”

Wedbush Securities analyst Michael Pachter told the Media & Entertainment Services Alliance (MESA) July 9 that MoviePass may not recover. “I don’t really know what MoviePass is up to, but they burned so much goodwill, I don’t see them recovering,” he said. “Each of the major chains can develop a subscription,” he added, noting Cinemark offers one movie per month for $10 and AMC “all you can eat for $20–$24.”

Although AMC “has a first mover advantage and is peeling away some customers” from its two main U.S. theater chain rivals (Cinemark and Regal), it’s not an “insurmountable” lead, he said, adding: “I think there will ultimately be around 3–4 million total subscribers, and AMC might capture 40% of them with the others at 30%.”

Regal didn’t immediately respond to a request for comment about its plans for an unlimited movie subscription service. Like AMC, it’s been running a customer loyalty service for a long time that provides multiple incentives for customers to see movies at Regal theaters.