Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

AMC and Sinemia Keep Making Life Harder for MoviePass

By Rick Munarriz - Sep 18, 2018 at 10:00AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Sinemia offers an unlimited multiplex plan, and AMC teams up with Atom and Fandango to take advantage of MoviePass' quick fade.

MoviePass parent Helios and Matheson Analytics ( HMNY -50.00% ) is about to give investors another splitting headache, but it's not the only thing weighing on the mind of the once disruptive multiplex subscription service. AMC Entertainment ( AMC -15.82% ) and Sinemia are making waves this week, enhancing their platforms in ways that will make it harder for MoviePass to retain its slipping relevance.

AMC is making its nascent movie subscription service easier to get to you, teaming up with online ticketing giant Fandango and social ticketing specialist Atom Tickets to allow folks to book AMC Stubs A-List screenings through either platform. Sinemia is going for the jugular, rolling out a new plan that offers daily viewings -- just the way MoviePass used to before its coffers started to run dry this summer. 

MoviePass card and smartphone app.

Image source: MoviePass.

Filling the void

Sinemia's new plan offers subscribers the ability to see a single movie a day, but it's different from the original MoviePass in terms of pricing. Sinemia sets filmgoers back $29.99 a month. MoviePass, in contrast, turned heads last summer at $9.95 a month, an aggressive price that helped it grow to 3.2 million subscribers when it peaked last month. But that growth came at a dear price. Helios and Matheson ran out of financing to keep its service running at that ridiculous price point.

Sinemia's new plan isn't just three times as expensive as MoviePass. Its price is billed annually. Folks wanting to pay month-by-month pay a $29.99 initiation fee. Sinemia also charges a modest transaction fee of $1.50 for every ticket purchased, something that may slow down some of the more active members that can bleed a company dry. On top of that, the company has plans priced as low as $4.99 that limit the number of movies one can catch.

MoviePass learned its lesson too late. It was selling dollars for quarters, a model that wasn't going to be sustainable over the long haul for a company with limited financing. One can argue that it would never have grown to more than 3 million subscribers in less than a year at the price points of AMC Stubs A-List or Sinemia, but now that its model is imploding, the climate is ripe for AMC Stubs A-List at $19.95 -- coincidentally the stock's closing price on Monday -- and Sinemia's unlimited feast at $29.99 to clean house. Helios and Matheson's bold pricing move last summer created the market for movie subscription services, and now it's not able to enjoy the spoils of the movement it started.

This isn't necessarily the end for MoviePass. It will never have the cost advantage AMC has, but there's no reason it can't compete against Sinemia at those elevated price points. Anything's possible if it can buy itself more time and stop the subscriber defections, but right now it's losing on both fronts. MoviePass is reeling, and everyone else is sensing an opportunity to be the new king of the multiplex subscription hill.  

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

AMC Entertainment Holdings, Inc. Stock Quote
AMC Entertainment Holdings, Inc.
AMC
$28.57 (-15.82%) $-5.37
Helios and Matheson Analytics Stock Quote
Helios and Matheson Analytics
HMNY
$0.00 (-50.00%) $0.00

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
656%
 
S&P 500 Returns
144%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/02/2021.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Our Most Popular Articles

Premium Investing Services

Invest better with the Motley Fool. Get stock recommendations, portfolio guidance, and more from the Motley Fool's premium services.