Over the past few months, we've been keeping a close eye on the ongoing struggles that MoviePass has faced as doubts continue to mount over the profitability of the company's revenue strategy. When we first heard about the subscription service last year, it almost seemed to good to be true. And now, the majority of reports seem to indicate that that may indeed be the case.
In his video essay detailing the inadequacies of MoviePass's business model, The Nerdwriter succinctly identifies the company's main problem: The subscription service costs $9.95 a month and the average movie ticket costs $9.16. MoviePass has to pay what you would be paying for the price of admission every time you go and see a movie using the service, which means that if you see more than one movie a month the company takes a loss. If you see two movies they pay double what they gain, three movies, triple, and on and on.