AMC wants to say ‘pass’ to MoviePass subscriptions at these low prices

AMC Theatres is warning against movie tickets that it says are too cheap for viewers’ own good.

The Leawood-based cinema chain, the largest theater operator in the world, issued its warning about MoviePass, a start-up that sells a movie pass subscription good for 365 shows a year.

MoviePass recently cut its monthly price from about $30 to $9.95 and set off AMC’s warning.

“In AMC’s view, that price level is unsustainable and only sets up consumers for ultimate disappointment down the road if or when the product can no longer be fulfilled,” an AMC statement said.

Its argument is that MoviePass may charge $9.95 but it has to pay full price to AMC, which averages $9.33 per movie currently. MoviePass will lose money on any subscriber who sees even two movies a month, it said, making the deal unsustainable.

Movie lovers also run the risk of losing “great new movies” and “quality theaters” to see them in, AMC said. Charging less than $10 per ticket won’t generate enough revenue to pay for those, AMC said. AMC added that it does not intend to give MoviePass a discount on tickets.

“We are actively working now to determine whether it may be feasible to opt out and not participate in this shaky and unsustainable program,” AMC’s statement said.

AMC is not in a position to reject MoviePass subscribers at the ticket window, MoviePass CEO Mitch Lowe said. MoviePass subscribers pay by using a Mastercard debit card that taps MoviePass’s accounts and funds the full ticket price.

“I’m sure at some point or another we’ll be best friends,” Lowe said of AMC. “We’re not asking them for anything, we’re paying full price, our customers are buying lots of concessions.”

MoviePass hopes to generate additional revenue from the data it collects about the movie-going habits of its subscribers.

AMC currently says it benefits from marketing to the 9.3 million members of its loyalty program, AMC Stubs.

“On average, we're marketing about 80 times a year to the typical AMC Stubs member,” AMC CEO Adam Aron said during a recent conference call with analysts, according to Seeking Alpha.

This story was originally published August 16, 2017 at 4:56 PM with the headline "AMC wants to say ‘pass’ to MoviePass subscriptions at these low prices."