Home News MoviePass vs. AMC. Who’s Being the Jerk?

MoviePass vs. AMC. Who’s Being the Jerk?

written by Dominic Gomez January 31, 2018
MoviePass vs AMC on a background of money

If you’re like me you most likely have a MoviePass subscription. Well, if you’re like me you most likely have ADD, love games, and musi…look a quarter. Anyway, my point is a lot of people have MoviePass. Since its inception, AMC has loathed MoviePass. MoviePass is currently accepted in the majority of AMC theaters. They have however pulled their support for 10 of AMC’s busiest.

How Theaters Make Money

This is fairly obvious, but there are really two ways your local theater makes its money. Ticket sales and concessions. From my understanding, the movie theater doesn’t make much on the ticket sales. The real money maker is concessions, which are grossly overpriced. This past weekend I took my son to see Jumanji, which was a great movie by the way. Among other things, I bought myself a standard size bag of M&M’s, something that is normally priced under $1 at the store. The sale price was $4.75. The majority of people that go to the movies buy more than just a single bag of candy.

What MoviePass is Doing

At $10 per month, MoviePass has to do something to make money right? No profit = closed business. The theater is still getting their money from the ticket, plus concessions. MoviePass wants a piece of both of those, and I’m not sure why AMC is pushing back so hard. Let’s look at some numbers from Ted Farnsworth, chief executive of MoviePass’ majority owner Helios & Matheson Analytics Inc.

MoviePass drove more than 1 million ticket sales to AMC theaters last month (December 2017), compared with 10,000 sales last July, the month before it cut its monthly subscription to $10 from as much as $50, said Farnsworth.

Let’s say each person bought one concession that gives the theater $4 profit. If these numbers are true, then MoviePass customers accounted for $4 Million of concession profits in one month. I think we all know people bought more than just one thing from concessions so that number is very low.

What MoviePass Wants

Naturally, MoviePass wants a cut. They would like a cut of the concessions and ticket sales. I think they should get that cut considering they are probably driving more people to actually go to the movies more. I know I’ll be seeing more movies now that I have a subscription.

MoviePass has been trying to bring AMC around for a while, Farnsworth said. The company has struck deals with close to 1,000 independent cinemas, in which it gets a roughly $3 cut on ticket sales and/or 25% of concessions sales.

Farnsworth is seeking a similar cut from AMC.

Being such a large venue, I would imagine a deal with AMC could even drop MoviePass’ cut of concession sales. That said, here is what AMC Chief Executive Adam Aron has to say about the matter.

AMC has absolutely no intention, I repeat no intention, of sharing any — I repeat, any, of our admissions revenue or our concessions revenue with MoviePass

Who’s being the jerk? Let us know in the comments.

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