Stacy Spikes didn't think he'd get MoviePass back. "It's one of those things where it's not going to work," he said over the phone on Thursday, "but if you don't try, you'll never be able to live with yourself." But he did, in fact, get MoviePass back. After a whirlwind legal process to rescue the company's remaining assets from a court after its previous owner filed for bankruptcy, the movie theater subscription service that flew too close to the sun is now back in the hands of its original founder. And he has big plans.
Here's the massively abbreviated history of MoviePass. It was started by Spikes and co-founder Hamet Watt in 2011, though Spikes said he'd been thinking about the idea for several years. The idea was simple: For one monthly fee, users could see a bunch of in-theater movies a month. It was movies-as-a-service for the power theatergoer. In 2017, they sold the company to Helios and Matheson, an analytics company, which fired Spikes in 2018. The new owner decided a clever way to grow MoviePass' subscriber base would be to lower the price to $10 a month and allow subscribers to see as many movies as they wanted. It worked! Millions of people signed up for MoviePass, and started going to movies at a remarkable pace. Almost as remarkable as the speed with which MoviePass hemorrhaged money on that deal. After more bad decisions and bad customer service, MoviePass crashed so spectacularly, it drove Helios and Matheson all the way out of business in January 2020.
Since then, MoviePass and other Helios and Matheson assets have been the property of a bankruptcy court. Spikes knew that much, and had heard that the assets had been put up for auction and hadn't found a buyer. "So I started to inquire about, could MoviePass be bought separately? And if so, how much?" He was eventually told to put in a bid, which he did a few months ago — he wouldn't say how much, though Insider reported the figure was less than $250,000 — and then he just waited. He figured someone else must be willing to bid, whether it was another entrepreneur or a theater chain just looking to put the idea out of play for good.
On Nov. 5, the court got in touch with Spikes. The bidding period was over, and nobody had complained about his bid or registered one of their own. A few days later, he got another call saying a judge had signed off on the whole thing. Spikes immediately wired the money to the court. "I wired that money so fast," he said. He couldn't believe it had worked. But a few signatures and counter-signatures later, by Wednesday, MoviePass was his again. It's part of his company, PreShow, which builds interactive advertising tech. "I think I'm still a little in shock that it actually happened," he said.
Stacy Spikes, the former and current founder of MoviePass. Photo: PreShow
Now Spikes has something founders rarely get: a do-over. A chance to take his idea — which he still thinks is right, and one that movie theaters have embraced in recent years as they've rolled out subscription services of their own — and do it right this time. "I really would like to get back in the fight to help drive traffic to theaters," Spikes said. MoviePass data showed that subscribers did go to more movies, and they did spend more money on concessions and the like when they were there. The whole thing could have worked, he thinks, just not at $10 a month.
In a way, his timing couldn't be better. After the pandemic decimated the theater business while simultaneously making streaming the default entertainment choice for millions of viewers, chains and small theaters alike are done holding onto the vestiges of the past and eagerly embracing anything that looks like the future. AMC embraced its status as a meme stock, went all-in on crypto, is planning to sell its popcorn in stores, and has invested in its own subscription service, AMC Stubs A-List. Other chains haven't embraced the 2021 zeitgeist quite so aggressively, but have spent the last few years upgrading theaters with nicer seats and better screens, and investing in subscription services of their own. "I think people are more open-minded," Spikes said. "And they're not out of the woods."
So what will the next MoviePass look like? Spikes isn't sure. He's planning to launch in 2022, and to spend the interim months talking to users, theater owners, movie makers, everyone involved in the industry, to get a sense of what they need and how MoviePass can help. MoviePass initially embraced its renegade status, helping people get around theater policies and systems, but Spikes wants to be a good partner this time.
He's particularly focused on smaller theater chains and even individual arthouse cinemas, which don't have the resources to do subscriptions of their own. "MoviePass is software, right?" he said. "We're not giving you a hard ticket, or popping popcorn for you." MoviePass' main appeal, he said, is that it gets people off their couches and into theaters. "What we found is that when people said, 'Hey, I already paid for it, I might as well go,' they automatically increased their attendance by 100%." He said his data showed that MoviePass provided more of a revenue lift to theaters than even IMAX or 3D. And in a time when the main competitor to theaters is streaming services and the 4K TV downstairs, anything that gets people out of the house might be a win.
What Spikes does know is that MoviePass should still be a consumer product, and that the price is everything. MoviePass didn't die because it was a bad idea; it died because "10 bucks a month for all the movies you can watch" is such a ludicrously good deal that some MoviePass users were buying movie tickets just to go to the bathroom in the theater. "There wasn't execution there," Spikes said, "and it wasn't at a price point that could win." He wants to build something sustainable now, both for MoviePass itself and for the rest of the entertainment industry.
I asked Spikes if he's prepared to embrace crypto and NFTs and go full AMC-style meme stock, and he demurred. "There's so many Wild West things going on," he said. "We're still in the business of, Friday night, how many bodies were in those seats?" MoviePass' job, he said, is "ultimately about smoothing out your decision to go to the movies." He's not planning a streaming service, he's not thinking about rentals, he's thinking about butts in seats in theaters. That was what he cared about more than a decade ago, and what he cares about now. "But we need to do it right, so it is sustainable, and everybody wins," he said.
The future of MoviePass, it appears, is substantially less wild than the past. And probably a little more expensive. But in this increasingly everything-as-a-service world, MoviePass might make more sense than ever. And its original creator has a chance to make it work.