In short: In a recent interview, a MoviePass representative spoke rather candidly and suggested the user side of the MoviePass service -- where people actually go to the theater and watch movies -- is technically the least important aspect of its business model. What is far more important it would seem, and one of the driving forces behind most of the business decisions is the collection of user data. This was all in addition to confirming that in spite of persistent media reports, the company is far from going bankrupt and has recently secured an additional $65 million in funding.
Background: The comments were provided by Ted Farnsworth, the CEO of Helios and Matheson Analytics, the parent company of MoviePass, as part of an interview given during The Wrap’s TheGrill 2018 event. As per those comments, Farnsworth admitted that the company never believed the subscription model would result in profitability on its own, and the move to offer unlimited movies for just $9.95 was more about getting users on board with the service so that their data could be used for other monetization methods. Of course, this bargain price approach did lead to financial issues for the company and to the point where it recently had to change the finer points of its subscription to ensure people saw less movies than they would like to. A point which Farnsworth seemed to explain is working out great for the company by confirming it's subscription service “alone right now is doing just fine” and this is the result of people “going to less than one movie a month.” Adding to all of this, when a customer does actually make it through the doors of a theater, the preference of the service has always been to push customers towards seeing movies MoviePass owns.
Impact: Perspective matters here, as while Farnsworth argues its subscription service is doing fine and people are going to see a limited amount of movies, there are consistent user reports coming through on social media that MoviePass keeps putting multiple hurdles in the way which stem the amount of foot traffic on its dime. Which when taken together would highly suggest the “just fine” status of the service is a direct result of some of these intentional moves, as it's in the company’s interests right now that people see less movies each month but continue to pay the monthly charge. In recent weeks, the company has hardly kept its intentions to cut costs a secret, as it's publicly announced multiple changes with the most compelling one being the reduction in ‘one movie per day’ to three movies per month. Although there does seem to be some language differences between how the company and its customers perceive some of the changes. For example, from a customer perspective they can no longer see a suitable number of movies each month, while from the MoviePass perspective - it’s fighting “abuse” of its service. Likewise, recently it became clear MoviePass was automatically re-enrolling some customers into its new service as their accounts has become “suspended,” compared to the perspective of some of those customers who argue they "cancelled" their account.