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A hot potato: It's been no secret that theater-going subscription service MoviePass has been struggling since its founding. Recent reports from insiders indicate that the company was in a lot more trouble than it publicly indicated and stooped to some underhanded tactics to keep the company from going under.
According to a Business Insider investigative report, shady operations were happening over the last two years at the "temporarily" shuttered theater subscription company MoviePass. Some of the shenanigans include changing users passwords without notice and setting up a "tripwire" to cut off ticket sales under false pretenses.
Multiple former employees stated MoviePass CEO Mitch Lowe, and parent company Helios & Matheson Analytics (Helios) CEO Ted Farnsworth resorted to "questionable" business practices to keep the struggling company afloat.
One of those tactics was to try to limit viewings during times of blockbuster releases like Avengers: Infinity Wars and Mission Impossible: Fallout. Lowe allegedly issued an order to have the passwords of "a small percentage of power users" changed just before those films released. They would later tell the public it was due to a "technical issue."
"How do we slow down those [power] users?"
Mitch Lowe: "F--- those guys."
Another shady practice exposed by the insiders was the use of a "tripwire" that was set to halt ticket sales whenever the company hits a specific daily monetary limit. When sales reached this threshold, users attempting to purchase tickets through the app would receive a message saying, "there are no more screenings at this theater today." Of course, this message was utterly untrue. It was just an attempt to stem the company's hemorrhaging cash flow.
MoviePass and Helios initially hoped they would snag enough users who only went to the theater once a month to make up for those that went more often. However, one would expect that with a limit of one movie per day (30 per month), those buying subscriptions would want to make the most for their money. This business model resulted in an inordinately large number of "power users" who had to be slowed down some way, apparently by any means available, which eventually ushered co-founder Stacy Spikes out the door.
Employees blame Mitch Lowe for the despicable tactic. "Before Mitch [Lowe] came on it was, 'How do we slow down those users?'" said one insider. "With Mitch it was just, 'F--- those guys.'"
MoviePass could not be reached for comment. According to BI, "Farnsworth and Lowe are nowhere to be found, as most of the staff have yet to learn the cause of the company's [July] halt."
Image credit: rblfmr via Shutterstock