Thursday night’s outage for MoviePass stemmed from money troubles.
That is a fact, proven by a regulatory filing (h/t CBS News). And yet, CEO Mitch Lowe’s lengthy apology letter reframes the Thursday incident that prevented subscribers from using the service in the most vague way possible.
“We sincerely apologize for the inconvenience caused from the temporary outage in the app over the past day,” the publicly posted letter, shared Friday, reads. “We have handled the issues on the back-end, and our app is now up-and-running with stability at 100%.”
For anyone that might not know, MoviePass is a subscription service that allows customers to see movies in theaters for one monthly fee. The cheaper $7.95/month option limits your moviegoing to three per month while the “premium” $9.95/month subscription allows you to see as many movies as you want, but only one per day.
The “issues on the backend” Lowe mentioned in his letter amounted to a missed payment to a merchant that handles securing tickets for MoviePass subscribers. When the merchant stopped processing payments — resulting in subscribers not being able to purchase tickets — MoviePass parent company Helios and Matheson secured a $5 million loan to fix the situation.
This is all public knowledge. What happened to MoviePass was reported widely. But rather than address the situation head-on, Lowe’s apology letter opens with an equivocation. That flapping sound you hear is a red flag undulating gently in the wind.
“Our app is now up-and-running with stability at 100%.”
The apologetic tone disappears after the letter’s first paragraph. The rest focuses instead on hyping MoviePass’s disruptive presence in the industry, and justifying the new, and unpopular, Peak Pricing feature.
It’s similar to something like Uber’s “surge” pricing. If you want to catch a popular movie on opening weekend, you’re going to have to pay a surcharge. Lowe notes that other upsell options are coming to the service soon as well, including premium viewing experiences (IMAX, RealD, 3D, etc.) and “Bring-a-Guest.”
He also offers an explanation for why some movies just aren’t available through MoviePass, with an ungainly comparison to subscription streaming services.
“This is no different than other in-home streaming options that often don’t carry the latest shows or movies that may be available on other services. For example, you can’t ever find Game of Thrones on Netflix, nor is Season 4 of Schitt’s Creek available there yet.”
There are two problems with that. First, MoviePass isn’t “another” in-home streaming option. It’s a first-of-its-kind movie theater ticket subscription service. This isn’t a 1:1 comparison.
Second, the subtext behind Lowe’s words here is hard to miss: Competition complicates things. Game of Thrones isn’t on Netflix because HBO has HBO Go/Now. For any of its troubles, the core idea behind MoviePass — pay one price for all the in-theater movies — is popular. Competitors are coming, and they have more experience in the space.
This apology letter isn’t any more egregious than one you’d see from another company that committed a highly public misstep. Deflect the bad, focus on the good. But this is also a moment where more transparency might have fostered some sorely needed goodwill, especially in the context of there having been other outages.
Instead, MoviePass customers got hype and optimism. The company’s willingness to sidestep difficult truths ought to worry subscribers more than anything else.
Here’s the letter.
First, we sincerely apologize for the inconvenience caused from the temporary outage in the app over the past day. We have handled the issues on the back-end, and our app is now up-and-running with stability at 100%. We thank you for your patience and your ongoing support.
This month, we introduced demand-based pricing to MoviePass. The first of those features, Peak Pricing, has rolled out nationally. Bring-a-Guest and Premium Features (ie., upgrades IMAX 2D & 3D, RealD, and more) will begin rolling out soon. We will continue to refine Peak Pricing and adjust the algorithm to take into account a lot of the feedback we’ve received in the past couple of weeks, and we thank you for your patience as we continue to evolve MoviePass into the best low-cost option in entertainment. Together, we are reviving moviegoing – and everything that goes along with it.
As we’ve shared with you before, rather than raise the price of the subscription, we’ve decided to enable all of you to have the choice between high value (ability to see up to one movie a day) at a low cost ($9.95) versus the flexibility to see whichever movie you want, wherever and whenever you want to see it. In other words, you can choose to see a movie in high demand on Opening Weekend for a small additional surcharge, or wait to see a popular movie a bit later in its theatrical run at no additional cost.
As we continue to evolve the service, certain movies may not always be available in every theater on our platform. This is no different than other in-home streaming options that often don’t carry the latest shows or movies that may be available on other services. For example, you can’t ever find Game of Thrones on Netflix, nor is Season 4 of Schitt’s Creek available there yet. Here at MoviePass, we have strived to make every movie in theaters available to you as part of your subscription, and Peak Pricing has allowed – and will continue to allow – us to do so.
Some of the feedback we’ve received from you about Peak Pricing is that more of you are using e-ticketing in our app. When you go to a MoviePass e-ticketing theater, you are helping theaters who are actively working with us to ensure that MoviePass remains the best low-cost option. Peak Pricing has also begun driving traffic to weekdays and off-peak hours, which is vital to the entertainment ecosystem and to the health of theaters across the country. Similarly, we are hearing loud and clear from studio and independent distributor partners who support the MoviePass model that our app placements are driving more of you to enjoy their films over others in the marketplace.
We share all of this with you as we believe in explaining to you, our customer, why we are doing what we are doing. We ask for your understanding and vocal support during this time, as we continue to fundamentally change an industry that hasn’t evolved much in years. In fact, ticket prices have risen so much that it’s now simply too expensive for many of us to go to the movies.
MoviePass’ mission is to make moviegoing accessible to everyone and to enhance the power of discovery – but we need your support as we refine our model for the long-haul.
Can’t find the movie you want to see on the app? Go to Twitter and let the studio behind it know. Want more e-ticketing theater options in your area, so that the movies you want to see peak less? Let your theater know you want them to partner with MoviePass.
We’re MoviePass and because of you, we are more than three million strong.
You can find it printed right here on the MoviePass website.