TV-MA | 1h 36m | Documentary, Business, Entertainment | 2024
Presented by Mark Wahlberg’s Unrealistic Ideas production company, director Muta’Ali Muhammad’s new documentary “MoviePass, MovieCrash” (“Crash”) presents the relatively brief history of MoviePass from inception to the present day with blazing efficiency. Clocking in at a brisk 90-plus minutes, “Crash” shows what happens when an innovative, game-changing concept is sabotaged by poor planning on the part of its founders and unbridled greed by some late-in-arriving industry “experts.”
When it was launched in 2011, the subscription movie ticket service MoviePass allowed its members the ability to see one theatrical release title per day for a fee of $50 per month.
Both Too Little and Too Much
The big catch here, something cofounders Stacy Spikes and Hamet Watt failed to recognize at the time, was that the average twice-a-year theater patron wouldn’t be interested in the service, and far too many dedicated movie fans would—in a big way. This disparate economic chasm widened further when the monthly fee dropped to under $40, and significantly more movie “hounds” made the idea of making MoviePass profitable a practical impossibility. At one point, the founders approach exhibitor AMC in the hopes of getting discounts but AMC wisely declined. At that point, the company had nothing to gain by partnering with a company with an unproven track record.A textbook American success story, Mr. Spikes left his native Houston for Los Angeles after graduating high school, and in the space of a decade worked in an executive capacity for Motown, Sony, Miramax, and October Films.
After years of MoviePass barely treading water, the founders brought in former Netflix and Redbox executive Mitch Lowe as the new CEO. A year later in 2018, the majority stock of MoviePass was acquired by the New York-based analytics firm Helios and Matheson (HMNY), whose CEO Ted Farnsworth, in tandem with Mr. Lowe, took full control of the company. Mr. Farnsworth soon fired Mr. Spikes and Mr. Watt, both of whom exited with approximately $80 million worth of company stock.
More Members, More Profits?
Mr. Lowe and Mr. Farnsworth banked that dropping the monthly fee even further (first to $14.95 and finally $9.95) would greatly increase membership, and they were right. Within months, subscriptions skyrocketed from a low of 20,000 to 600,000, and eventually 1 million. However, this trade-off still left the company drowning in red ink. MoviePass was still responsible for covering the full retail price of every ticket sold.Allowing members to see “any movie, any theater, any day” for under $10 a month never had a chance of succeeding. At one point, it is stated that once the subscriptions exceeded 5 million, MoviePass would begin to show a profit. Even if the monthly fee was $300, MoviePass would continue to lose money. Members seeing a movie every day (and many did) cost the company $300 per member per month.
So, how did Mr. Lowe and Mr. Farnsworth keep MoviePass technically afloat? It’s simple: They marketed the service in the same manner that studios advertise tent-pole movie franchises. Wine flowed, caviar was served, influencers (including Dennis Rodman) were hired, and press junkets to film and music festivals (such as Sundance and Coachella) were afloat with decadent excess.
From Bad to Worse
There were also private jets, helicopters, and yachts, and the decision to partially produce the box office bomb “Gotti” starring John Travolta, which currently holds a 0% critical rating on Rotten Tomatoes. So adept were Mr. Lowe and Mr. Farnsworth at persuasion that once the HMNY funding began shrinking, they called on Hudson Bay Capital Management to pick up the slack.In look, approach, tone, and content, “Crash” bears a lot in common with director Alex Gibney’s “Enron: The Smartest Guys in the Room” and “Casino Jack and the United States of Money.” Even though Mr. Muhammad, Mr. Spikes, and Mr. Watt (all Black men) suggested, without any proof, that the ousting of the latter two from the MoviePass board was possibly racially motivated, the movie is remarkably dispassionate and unbiased.
The black hats and white hats here are clearly identified within minutes of the opening of the film. Mr. Muhammad was wise to (mostly) stick to the facts, while also including interviews with former MoviePass subscribers, employees, and lower-rung investors.
The movie ends with an update on the fate of the four principals, some of whom have yet to be fully legally determined, and it all struck me as oddly poetic. At one point, there were talks about karma, being (paraphrasing) “difficult,” and they were right. The ultimate fate of MoviePass still isn’t known, but at the very least, those who torpedoed it for no reason other than blatant greed will likely get their just desserts.
