SINGAPORE: It sounds like a deal that would get even the most casual Singaporean movie-goer drooling: Watch a film a day for the nominal price of about S$13 per month.

Bearing in mind that watching just one movie here could cost around that amount, it may sound like a crazy idea.



Such a bargain-of-a-lifetime deal is currently on offer in the US through the MoviePass subscription service, which allows people to watch a movie a day for US$9.95.

Although the service has been around since 2011, it started generating a major buzz when it slashed its prices to lure new customers. In August last year, the company moved from a tiered pricing plan that ranged from US$15 to US$50 per month, to its current flat fee.

With Netflix having already disrupted the cable TV business in Singapore with unlimited access to its movies and TV shows for a relatively small monthly fee, could the cinema industry here be facing a similar game-changing addition to the landscape?

WILL IT WORK IN SINGAPORE?



Singapore cinema chain Golden Village (GV) told Channel NewsAsia that it believes the effectiveness of something like MoviePass in Singapore would be limited, especially in terms of driving up audience numbers.

"The MoviePass assumes that cost is the only factor that is responsible for lacklustre cinema admissions," said a GV spokesperson. "(But) we know that price is not the only determining factor contributing to attendance figures, but rather, the culmination of other factors."

According to GV, other factors such as the lack of appealing new releases as well as more NC16-rated films, where cinemas have to carry out stringent checks on customers, often result in movie-goers watching films on other platforms, sometimes illegally. Furthermore, GV said, competition from other forms of entertainment is a factor in limiting the growth in admissions.

In the US, the bargain-basement price offered by MoviePass has also been met with its fair share of scepticism from cinema chains, even though there should be no impact on their revenue from ticket sales.

Under the MoviePass business model, cinema chains still receive the full price for the tickets passed on to its subscribers. MoviePass doesn’t allow customers to see the same movie more than once and restricts users to standard screenings that are not 3D or IMAX.

However, questions have been raised about whether MoviePass has a sustainable business if it continues with its US$9.95 price when subscribers may be visiting the cinema dozens of times a month.

So exactly how does MoviePass make money?

According to the company, it seeks to earn revenue from other avenues like monetizing its vast user database.

MoviePass believes it can help promote movies because it knows what subscribers see, when and where. More subscribers mean more data, which in turn means more leverage. And leverage is key when turning a profit - whether it’s selling MoviePass’ valuable data to movie studios who will use it to do targeted marketing for their films or directly influencing consumer behaviourthrough focused advertising.

The company is also eyeing a share of a cinema's sales from popcorn and other snacks, as well as profits from possible partnerships from complementary retailers and F&B businesses even after the subscriber has left the theatre.

But does this all add up?

"IT’S NOT IN THE BEST INTEREST OF MOVIEGOERS"

AMC Theatres, the world’s largest movie theatre chain with more than 650 locations in the US, has been very vociferous in its opposition to MoviePass. It said in a press statement that the service “is not in the best interest of moviegoers, movie theatres and movie studios” as it “will not provide sufficient revenue to operate quality theatres nor will it produce enough income to provide filmmakers with sufficient incentive to make great new movies.”

“From what we can tell, by definition and absent some other form of other compensation, MoviePass will be losing money on every subscriber seeing two movies or more in a month,” it said.

“In AMC’s view, that price (of US$9.95) is unsustainable and only sets up consumers for ultimate disappointment down the road if or when the product can no longer be fulfilled.”

If MoviePass or a comparable service were to be available in Singapore, it could very well run into similar issues. GV questioned the subscription model's sustainability and ability to continuously attract new subscribers.

"We do not see discounting as a viable long-term solution to an industry-wide problem,” said the GV spokesperson. “Even if the model is price attractive at the start.”

RE-DEFINING THE CINEMA EXPERIENCE

Which is why GV is aiming to grow and retain its audience by redefining the cinema experience rather than looking at different business models.

“At GV, our focus is on creating better value, variety and more choices – whether that be through enhanced seat types, audio-visual improvements, F&B, cinema design, screening events and film festivals," said the GV spokesperson. "The cinema industry faces challenges but innovation and re-defining what value means to today’s cinema-goer is our focus."

For entertainment company mm2 Asia, which just completed its acquisition of Cathay Cineplexes, it will likewise look at “various marketing strategies moving forward”.

“It is still too early to comment on the effectiveness of the MoviePass ticketing system,” Hock S. Ong, CEO of mm2’s cinema business, told Channel NewsAsia. “But we will always keep our eyes open to market trends and the possibilities they present."

According to Verge.com, subscription models in Europe, such as Odeon Cinemas’ Limitless pass and The Light Cinemas’ Infinity pass, have ensured a steady stream of regular customers coming through cinema doors. The operators can count on increased revenue from sales of high-margin items such as snacks and drinks to make up for lost ticket revenue.

The major difference is that these offerings are kept in-house by each cinema chain, ensuring customer loyalty and control over other revenue streams.

HIT OR MISS?

However, while doubts remain about whether a subscription model could work in Singapore, local movie fans are enthusiastic about the idea.

HR assistant Angela Poh, 25, thinks something like MoviePass would be “a hit” in Singapore.

“But not with the cinemas who show the movies,” she said. “I doubt they would be game to let people watch many movies for a small fee each month.”

Shalini Selvam, 29, agreed. “I don't think it would work here because I doubt GV and Shaw, the two biggest cinema operators here, would jump on board with a system that lets you watch so many movies for so much less a month, considering that they charge about S$10 per movie ticket,” she said.

And 23-year-old undergraduate Hamka Afiq would jump at the chance to sign up to MoviePass if it came to Singapore.

“I'd go for all genres of movies, but I especially like the superhero blockbuster types of films. So I've stayed away from the more independent and obscure titles because of the money I spent on the superhero blockbusters,” he explained.

“The pass would be my opportunity to watch every movie release.”

