AMC Theatres announced today its concern that an announcement by a small fringe player in the reselling of movie tickets is not in the best interest of moviegoers, movie theatres and movie studios. Accordingly, AMC is consulting with its attorneys to determine if or how AMC can prevent a subscription program offered by MoviePass from being used at AMC Theatres in the United States. AMC is the largest movie theatre operator in the United States.
MoviePass announced a change to its “subscription model” that would allow consumers to see up to 365 movies a year for a monthly fee of $9.95. MoviePass envisions paying AMC its full ticket price without discount. The AMC average ticket price for watching a movie at AMC Theatres in the most recent financial quarter was $9.33. From what we can tell, by definition and absent some other form of other compensation, MoviePass will be losing money on every subscriber seeing two movies or more in a month.
Bloomberg today called it a “crazy plan.” AMC noted that it is not yet known how to turn lead into gold. AMC believes that holding out to consumers that first run movies can be watched in theatres at great quantities for a monthly price of $9.95 isn’t doing moviegoers any favors. In AMC’s view, that price level is unsustainable and only sets up consumers for ultimate disappointment down the road if or when the product can no longer be fulfilled. AMC also believes that promising essentially unlimited first-run movie content at a price below $10 per month over time will not provide sufficient revenue to operate quality theatres nor will it produce enough income to provide film makers with sufficient incentive to make great new movies. Therefore, AMC will not be able to offer discounts to MoviePass in the future, which seems to be among their aims.
While AMC is not opposed to subscription programs generally, the one envisioned by MoviePass is not one AMC can embrace. We are actively working now to determine whether it may be feasible to opt out and not participate in this shaky and unsustainable program.
About AMC Entertainment Holdings, Inc.
AMC (NYSE: AMC) is the largest movie exhibition company in the U.S., in Europe and throughout the world with 1,009 theatres and 11,083 screens across the globe. AMC has propelled innovation in the exhibition industry by: deploying more plush power-recliner seats; delivering enhanced food and beverage choices; generating greater guest engagement through its loyalty program, web site and smart phone apps; offering premium large format experiences and playing a wide variety of content including the latest Hollywood releases and independent programming. AMC operates among the most productive theatres in the United States’ top markets, having the #1 or #2 market share positions in 22 of the 25 largest metropolitan areas of the United States, including the top three markets (NY, LA, Chicago). Through its Odeon subsidiary, AMC operates in 14 European countries and is the #1 theatre chain in Estonia, Finland, Italy, Latvia, Lithuania, Spain, Sweden and UK & Ireland. www.amctheatres.com
Ryan Noonan, 913-213-2183