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MoviePass threatened with lawsuit after slashing subscription fees to $10 a month

AMC Theatres has threatened MoviePass with a lawsuit, less than a day after the subscription cinema service dropped its subscription fees to $9.95 a month, reports Variety. That means subscribers are able to watch one movie every day for a month for only $9.95. MoviePass would still have to pay AMC full ticket prices each time someone uses the subscription, though. An average ticket is priced at $9.33, so a subscriber would only need to attend two movies a month to put MoviePass at a loss.

In 2016, the service started at $15 per month and ran up to $50 per month for unlimited movies in bigger cities. AMC, which is the largest theater chain in the US said in a statement that MoviePass’ model is unsustainable. The company argued that ticket prices below $10 a month over time wouldn’t be able to generate enough cash to operate quality theaters, nor produce enough income that would allow film makers to make movies of value.

MoviePass first signed a deal with AMC in 2014, that offered subscriptions starting from $35. MoviePass CEO Mitch Lowe told Variety the latest $10 deal still has to close. He accepts that the company is subsidizing movie tickets for subscribers and would “lose money in the process.” AMC said it’s working with lawyers to see if it can prevent the subscription from MoviePass being used at its cinemas.

“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,” says AMC in a statement.

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