MoviePass Experienced a Random and Serious Outage Last Night, All Because They Ran Out of Money
No, seriously. Yesterday night, the theater-based subscription service MoviePass actually ran out of money. Thursday night, users of the famed film app started experiencing outages and were completely unable to use their subscription cards.
In a filing post-outage, MoviePass' parent company Helios and Matheson Analytics stated that, "the merchant and fulfillment processors may cease processing payments for MoviePass, Inc . . . which would cause a MoviePass service interruption." Most analysts interpreted this as merchants demanding money they claimed was owed to them which the company was financially not able to pay back.
Helios and Matheson had to borrow $5M just to keep the company afloat, which has many users pulling out before the entire operation blows up. After rate increases and a system which charged you extra for seeing movies in primetime time slots, MoviePass subscribers have been becoming more and more skeptical of the shady business.
In many ways, MoviePass was doomed to fail from the start. At its core, the company was bulk buying movie tickets which it couldn't afford -- some subscribers early on were seeing 30+ movies a month for the price of one.
Now facing bankruptcy and their listing being removed from Nasdaq, the company will surely continue raising prices and fiddling with surcharges to make the purpose of MoviePass ultimately minute.
Source: The Hollywood Reporter