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Two days after MoviePbad has announced the return of the company's unlimited ticket plan. Ted Farnsworth, CEO of parent company Helios and Matheson Analytics, met TechCrunch to provide insight into the state of the besieged service.
According to the executive, MoviePbad Uncapped is already seeing positive results. Although he did not release any concrete figures, he explained that the number of subscribers has increased by more than 800% in the last few days. And it's conservative.
When asked what it would take for the company's subscription to be profitable, Farnsworth replied, "Well, it's profitable for the moment. actually paid back to Helios over the last few months, in return for the loans they have contracted. So that gives you an idea of when we really started getting rid of the 20% aggressors. "
This plan marks a return to the unlimited initial model that has allowed MoviePbad to become a well-known name over the past year. But this success came with a huge price, while the service began to cause haemorrhaging. MoviePbad removed the unlimited package and began reworking its plans on what appeared to be a weekly basis.
In July, at the height of what was to be the summer of MoviePbad, the service went down while it was struggling to pay its bills. Helios has secured a $ 5 million loan from Hudson Bay Capital Management creditors to relight the lights.
WEST HOLLYWOOD, CA – FEBRUARY 24: Ted Farnsworth Participates in the 27th annual Elton John AIDS Foundation Oscars Screening Night, sponsored by IMDb and Neuro Drinks, on the occasion of the EJAF celebration and the 91st Academy Awards on February 24, 2019. West Hollywood, California. (Photo by Jamie McCarthy / Getty Images for EJAF)
"I think the big SNAFU was the credit card company," says the manager. "When one company sold to another, we had been doing business with it for four years. They decided that it was too much credit for them and literally called the credit line on a Friday night and I gave them a personal guarantee on a Saturday. "
Be that as it may, the outlook for such a situation was clearly not ideal. MoviePbad's struggles were very public right from the start, as part of a publicly traded company. A total closure of the service seemed to be the last sign that the too good to be a real service was exactly that.
And while Farnsworth admits the company would have enjoyed a little more privacy, he claims to have never doubted the future of MoviePbad, even though he had negotiated with creditors for a new injection of funds.
"There was no moment in my mind where I thought it would go down. In my mind, I thought it was too big to fail, "he says. "You have created a household name in less than a year. I think every time you have something like that, you're going to have pure growth problems. Our investors have invested well along the way. Investors have believed in us and they still have it. We knew we had to slow down to put ourselves ahead of the fraudsters because there were so many moving parts. It moved so fast. "
It's this "fraud" that was at the center of MoviePbad's woes, says Farnsworth. In his opinion, the first disadvantage of MoviePbad is the result of too many users who "play the system". He thinks that the total number of users in this category represents about 20% of the total number of subscribers.
It was a minority indeed, but a significant figure, since last June, this total figure had exceeded three million. At this point, the service also accounted for about five percent of US box office revenue. The past year has been devoted to trying to fill the gaps of the subscription service while the MoviePbad boat was starting to take water quickly.
To be clear, "playing with the system" does not just mean watching a lot of movies – Farnsworth is happy to have "hardcore" users, even if they buy tickets for more than $ 9.95 or $ 14.95. Rather, he's concerned about users sharing their subscription or just using a MoviePbad ticket to use the theater's washroom – something that's surprisingly commonplace in places like Times Square, where public toilets are hard to find.
According to Farnsworth, one of the main fixes is to use mobile tracking to ensure that subscribers are actually using the service as intended and to search for "red flags," such as constantly changing devices with the help of the application. Users must already enable location-based tracking to purchase tickets. This will use this to ping the ticket buyer's location to ensure that they are actually watching the movies for which they purchased tickets.
"For example, another problem is where people go to the theater, they go get the ticket, they will give their ticket to the child or their child or to a friend or whatever. other … and the person who pays the subscription goes home or whatever they do, "he says. The new strategy: "When the movie starts, 30 minutes later [we’re] able to ping them inside the theater, just to make sure they're still at this theater. "
Mr. Farnsworth said that for the future, prices and restrictions were constantly changing and that the company was committed to adopting the unlimited plan. In fact, in his remarks, the goal was always to return to the unlimited plan – it was simply that MoviePbad needed to find a way to reduce fraud for the plan to work.
At the same time, he says MoviePbad's film studio will also be an important part of his business. It has been overshadowed by headlines over the company's underwriting issues, but MoviePbad Films has headlines featuring Bruce Willis, Al Pacino and Sylvester Stallone, scheduled for this year.
MoviePbad has also invested in "Gotti" and, although the film has been criticized by critics and has reported only $ 4.3 million at the box office, Farnsworth does not see the failure.
"We never considered Gotti as a money generator," he says. "They only planned to spend $ 1.3 million at the counter here. Because when we pushed with MoviePbad, we raised that figure to five million. So, I mean, when you can take a movie – I have to be careful here, but when you take a movie, it may not be very good or perfect, and you can move that needle, [that] has always been our subscription theory. "
Come back later for our full interview with Farnsworth.
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