AP Photo/Darron Cummings
MoviePass.
- MoviePass will raise its monthly subscription price to $14.95 within the next 30 days.
- The service will also begin to limit the ability of movies released on more than 1,000 screens.
- The hope is this will cut the company's monthly burn rate by 60%, according to a press release.
In a press release sent Tuesday, MoviePass announced that within the next 30 days, the monthly subscription price for the movie-ticketing service will rise to $14.95 per month.
The company also announced that movies released on more than 1,000 screens would be "limited in their availability during the first two weeks, unless made available on a promotional basis."
These steps have been taken in the hopes of cutting the company's monthly cash burn by 60%, according to the release.
This announcement follows Business Insider's story on Monday reporting that, in an all-hands meeting, MoviePass CEO Mitch Lowe announced the app would no longer make available major Hollywood releases on the app like this weekend's new release, Disney's "Christopher Robin," and the following week's shark thriller "The Meg."
"While no one likes change, these are essential steps to continue providing the most attractive subscription service in the industry," Lowe said in the release. "Our community has shown an immense amount of enthusiasm over the past year, and we trust that they will continue to share our vision to reinvigorate the movie industry."
The news comes close to the one-year anniversary of MoviePass drastically changing its business model by offering the service for just $9.95 per month for one movie per day. Since then, the service has been a hot-button topic in the movie industry and AMC Theatres, the largest chain in the world, has been vocal about the lack of confidence it has in MoviePass' business model (AMC has since started its own monthly subscription service).
Helios and Matheson Analytics, MoviePass' parent company, had an average monthly cash deficit of $23 million in the first quarter of 2018, which rose to $40 million in May and an estimated $45 million for both June and July. In the last few weeks, Helios and Matheson has struggled to keep its stock above $1 and suffered multiple service interruptions.
"Over the past year, we challenged an entrenched industry while maintaining the financially transparent records of a publicly traded company," HMNY CEO Ted Farnsworth said in the release. "We believe that the measures we began rolling out last week will immediately reduce cash burn by 60% and will continue to generate lower funding needs in the future."