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Is MoviePass Blowing Up Their Own Business Model?

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MoviePass is making some changes to their current service, but does it mean that they're abandoning their previous business model?

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It looks like MoviePass has finally figured out how to make money.  Well, maybe.  After trying out several payment models in 2016, MoviePass finally figured it out when they lowered the price of their unlimited plan to just $9.95 a month. It felt like it was too good to be true.  Why?  for less than the price of a single movie ticket in New York City, subscribers could see up to 30 movies a month.  That’s ridiculous, right?  Completely, and that’s why I’ve been scratching my head this whole time, trying to figure out how they’re doing it.  But now, MoviePass seems to be making a big change.  Does this indicate that their original model is not sustainable?  Or is this just a way to put more money in their pockets?

MoviePass recently announced that it was teaming up with iHeartRadio in order to give new subscribers the chance to sign up for three months of MoviePass.  This would also include a three month trial of iHeartRadio All Access.  The price?  Only $29.95.  But where this gets interesting is two-fold.

  1. With this particular deal, you’re only allowed to see four movies per month.
  2. If you go to MoviePass right now, you will notice that the iHeart Radio offer is the only way to sign up for the service right now.

MoviePass

What does this mean?  Well, it might just mean that they’re limiting how many movies you can see in a month.  The $29.95 is a three-month trial, so you’re technically still getting it for $9.95 (or so) a month.  But after those three months are up, you’re likely going to have to pay the full price.  What’s not clear is if that will be $29.95, or if you’ll be able to get the service for $9.95.

Getting access to iHeartRadio is pretty good, regardless of how you look at it, but when you compare it to having the ability to see one movie per day, every day of the year, it’s not as good of a deal.

The good news?  This offer doesn’t seem to have any effect on current subscribers.  If you signed up under the old service, and before last Friday, your plan should still work the same way that it always has.  There is a concern, though, that this four movie limit will eventually apply to all subscribers once this iHeartRadio offer ends.  But let’s be honest, even if it does, this is still a really good deal.  Being able to see 30 movies a month, for the price of one is incredibly obscene.  I mean, I’m not one to balk at free stuff, but this isn’t a sustainable business model.  And maybe that’s why it’s changing its tune?

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There is the possibility that MoviePass goes back to the way that it was before.  But MoviePass has the ability to change its terms and conditions at any time.  While there is no evidence of limiting, it makes you wonder if this is more of a sustainable business model for them, and that’s why they’re making the change?

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