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Movies Businesses The Almighty Buck

A Subscription-Based Movie Theater 308

Posted by Soulskill
from the works-for-tv dept.
When the local movie theater in Oakhurst, California went out of business, residents were stuck without a way to watch films on the big screen without driving for at least an hour beforehand. Now, three men are trying to resurrect the theater with one major change: instead of relying solely on ticket sales, their business model revolves around subscriptions. From the article: 'They ran models of Nelson's subscription-based theater idea, showing that to break even they would need 3,000 people, or 15% of the mountain communities, to sign up. For $19.95 per month, a member would be able to see each movie one time and buy individual tickets for friends. Non-members could buy a $16 day pass. While researching the theater business, Nelson learned that studios are transitioning to digital distribution. Thousands of independent theaters that couldn't afford equipment upgrades have closed over the last 10 years, according to industry experts. Hundreds of others — which, like the Met, still show print films — remain on the brink. The subscription business model could pay for the new equipment.'
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A Subscription-Based Movie Theater

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  • Re:too expensive (Score:5, Interesting)

    by godrik (1287354) on Tuesday January 01, 2013 @09:11PM (#42446553)

    When you have a free "movie ticket for everything" you start going to see stuff you would not have seen otherwise. $20 a month is not a bad deal. I'd totaly take that.

  • Another idea (Score:3, Interesting)

    by Anonymous Coward on Tuesday January 01, 2013 @09:19PM (#42446607)

    would be the Green Bay Packers model [wikipedia.org] of community ownership. Keep the theater private but sell shares in the company; for $300 you would be part owner, and would be able to buy a subscription for either $15/month or get a $3 discount on individual tickets.

  • by rastoboy29 (807168) on Tuesday January 01, 2013 @09:25PM (#42446651) Homepage
    Wouldn't it be an even better idea to allow subscribers to see all the movies they want?  a) it sounds like a better deal for potential customers and b) they are still likely to purchase overpriced refreshments, which is the real cash cow of a movie theater.

    Not to mention not having to track who has seen what.

    Duh.
  • Re:too expensive (Score:5, Interesting)

    by adolf (21054) <flodadolf@gmail.com> on Tuesday January 01, 2013 @09:27PM (#42446665) Journal

    They'd have to give a discount on food as well. At least in the US popcorn and a drink run you as much as the ticket.

    "Have to"? Why? Because you'd shrivel up and die if you don't have a dose of artificially-flavored popcorn with artificially-sweetened fizzy water within a 2-hour window?

  • Re:Better idea (Score:3, Interesting)

    by wisnoskij (1206448) on Tuesday January 01, 2013 @09:43PM (#42446773) Homepage

    That is a decent price, but even $5 is really on the high end when you are talking about sitting in a $5 chair in a big concrete box for 2 hours watching a screen only like 10 times bigger than what many people have a home nowadays. Even without factoring in the profits from snacks and candy a business model should be maintainable on like $1 a viewing.

  • Re:Great Deal (Score:5, Interesting)

    by Fluffeh (1273756) on Tuesday January 01, 2013 @09:53PM (#42446827)

    I don't know about you, perhaps I am an old fuddy duddy, but I can't imagine that 15% of residents would go for that. I personally go to cinemas barely once per year and a lot of the folks I know are similar. Okay, there is the day pass options, which would work, but if their business model relies on 15% as being the critical mass needed, it seems a bet with some rather long odds.

    And while $20 a month does pass for itself after two movies, are you really going to go to see that many movies? Are there even that many new movies coming out these days - let alone that many worth watching?

    Now, if the cinema was playing older movies or classics along with the new releases, that might start to get interesting.

  • by bagboy (630125) <neoNO@SPAMarctic.net> on Tuesday January 01, 2013 @10:13PM (#42446933)
    This... > "So, added value options may grow from being a novelty to the norm................" We have a local theater that has for 10 years - offerred around 3-6 month out of date releases (and lots of indie films) for 3 bucks a ticket, You can order your meal (specialty pizzas, burritos, hot sandwiches) which is delivered to your table (every other row are tables instead of seats, you place your black-light sensitive cone at your spot), has it's own brewery and beer/wine bar in the back of the downstairs (in the theater) (balcony seating for those under 21 or unaccompanied by adults). 10 years later and it still has lines out the doors Friday - Sunday before showings. It's an awesome date/family event. They even have special events for bands and indie film events. This - is how a movie theater can stay relevant.
  • It won't work. (Score:2, Interesting)

    by Anonymous Coward on Tuesday January 01, 2013 @10:13PM (#42446935)

    I have managed theaters for two large chains. Frankly the concept of a movie theater is dead meat. The hang on, improve and survive executives simply have lost the battle.
                        Early on the theaters were huge. The cost of admission was trivial. Theaters relied on candy, popcorn and sodas as well as more complete menus the further back one goes. That was the profit gimmick. One need not make a penny on film if one sells enough food. Sadly theaters lost the ability to serve decent snack food as management types cut back on food expenses and quality. That alone was enough to kill the industry but inflation and the invention of TV and then cable were the death songs of the theater industry. One can easily have a first rate movie experience at home and the cost is trivial as it is wrapped in bundled services. For about $5. per day i can have thousands of movies and shows, my phone service and a high speed net connection that dwarfs a wired connection and use these features all day, every day. For another buck or so my home alarm service can also come by cable. Compared to that why would i go to a theater?

  • Re:Better idea (Score:5, Interesting)

    by Anubis IV (1279820) on Tuesday January 01, 2013 @10:28PM (#42447015)

    Similarly, I just went to go see The Hobbit earlier today with a coworker (my supervisor, in fact...we skipped out of work early since he wanted to see it), and it was $4 for each of us. To say the least, the theater was packed, despite the fact that our college town is virtually empty while everyone is gone for the holidays. Mind you, this isn't some trashy theater in a seedy part of town either. It's a standard Cinemark in a good location with all of the usual amenities you'd see in an urban center (digital projectors, 3D, XD, and whatever other marketing terms they've invented since I last looked). I think the reason our prices are so low is because our area has around 200,000 people, 50,000 of whom are fickle college students that will go to whichever theater is cheapest, and there's a Premiere theater just down the street that has shown a willingness to closely match the prices Cinemark posts up.

    I've always heard that the concession stand is where the money is at in a theater, and if that's true, I don't know why they're not dropping prices on tickets to get more butts in seats. As it is, higher ticket prices just encourage people to spend more time and money at home with their own entertainment setup.

  • Re:Great Deal (Score:5, Interesting)

    by lawpoop (604919) on Tuesday January 01, 2013 @10:39PM (#42447069) Homepage Journal
    Maybe you are the new-fangled type that prefers to watch media on their home entertainment system?

    I've found that certain movies are enjoyable on the big screen, and less so on the small. Does that mean they lack something? Probably -- but for me, it's about the experience of the film. If it needs to be seen on the big screen for me to properly get the full effect, so be it. If it makes a less stellar movie feel like it was worth it, then it was worth it.

    I don't go to the movies twice a month-- probably more 6-8 times a year-- but if I could go whenever for $19.95 a month, I might see almost every movie. If have have to shell out $10 for a movie, I have to think really hard if it will be worth it. If I've already shelled out the cash, it's a no-brainer.
  • Re:Great Deal (Score:2, Interesting)

    by Anonymous Coward on Tuesday January 01, 2013 @10:52PM (#42447127)

    The subscribers might have a vote in what movies come to the theater... who knows? I go to the movies all the time and would surely take the deal. And looking at our local prices of $12.75 for a primetime movie on a weekend, the daypass does not seem that bad. Hey, they could always become members, right?

  • by nrozema (317031) on Tuesday January 01, 2013 @11:12PM (#42447267)

    This is my local theater.

    Last night they announced that they hit the 3,000 subscriber mark they were shooting for and will make a go at opening.

    I wish them the best, though I think there are still some very big questions to be answered about the viability of the business model. Will the studios go along with it? Will subscriptions _remain_ high enough after the buzz fades away to be a viable business? I hope so, but only time will tell. The local economy is almost entirely tourism based, and their model effectively shuts out tourists who I think will be reluctant to shell out $16 for a day pass - so long-term local support is essential.

  • Re:Great Deal (Score:5, Interesting)

    by suomynonAyletamitlU (1618513) on Tuesday January 01, 2013 @11:56PM (#42447561)

    Now, if the cinema was playing older movies or classics along with the new releases, that might start to get interesting.

    I have often thought that a cinema with smaller rooms and a giant database of TV shows and movies that you could rent by the hour would work. Want to watch 20 hours of Buffy or Star Trek with friends? Groovy, get some comfy chairs, a big screen, and all the popcorn you can pay for. Soundproofing and a private screening means you can yak it up.

    But then, I suppose people would prefer their own home cinema in a lot of circumstances, and unsupervised people in dark rooms...

  • Exists in France.. (Score:4, Interesting)

    by Archon-X (264195) on Wednesday January 02, 2013 @03:35AM (#42448353)

    Both big cinema conglomerates In France still do this, and have for years.
    Unlimited movies in all cinemas. No blackout times. 20EU per month, or 35EU per month for a couple.

    It's a great idea, and lots of people use it - considering normal adult tickets are 10 - 12EU.

    The 'gotchya' is that it's a pain in the ass to unsubscribe - it's auto-debited from your bank account each month, so to cancel you need to send a letter via registered post etc to close your membership.

    Small price to pay, however!

  • Re:Great Deal (Score:5, Interesting)

    by Canazza (1428553) on Wednesday January 02, 2013 @07:31AM (#42449095)

    In the UK, one of the biggest cinema chains in the country - CineWorld - already do a subscription pass that lets you in to any film any number of times, while still using the old distribution model for normal customers.

    The problem is that, while yes, you can get in to see any film any time, you still have queue to get a ticket from the desk, and you *cannot* purchase on line ahead of time. Normal paying customers can, so for big blockbuster films on opening night (or opening week depending on how popular it is) it can be nigh on impossible to actually get in for a card holder without having to pay *anyway* just to book ahead.

    My mum runs a film group and about 60% of their members have this card, and they're pretty much always treated like second class citizens, with one cashier even outright stating that they don't really care about card holders because they don't bring in any money for them. That card holders tend to be more money savvy and as such won't buy the overprices drinks and popcorn from the stalls.

    Then, down the road, there's the smaller, more indie, cinema. Doesn't show as many blockbusters, quite a few indie films, focuses on the smaller, but popular films. Like Life of Pi, Mostly the focus on really good events. I went to see the original cut of Alien and Aliens in there, using the original reels. I missed it, but they also had James Earl Jones taking a Q&A once. They're showing Spirited Away later this month, and I think February is shaping up to be Studio Ghibli month.
    It has a really nice bar area (that you wouldn't mind visiting outside of watching a film), and they let you take alcohol into the showing (in plastic glasses), infact, all the smaller cinemas around here do that kind of thing. They don't have over-priced stalls, but they will offer you popcorn from behind the bar. And they're doing quite well.

    It's not the pricing model that's failing, it's knowing your core audience and catering for them. If your in a city you can pick and choose your core audience (as exampled above by a giant conglomorate cinema company co-existing 4 streets away from one of the oldest cinemas in the city), however if you're in a small town, or the middle of nowhere, if your core audience doesn't want to go see films, no alternate pricing models are going to fix that. What you need to do is remind them there's a cinema there. Throw some events. Find out what films your patrons want to see and put those films on, even if they're 20 or 30 years old, hell, even if it's from before there was sound, if they want to see it, get a hold of it and put it on.

    There seems to be this crazy notion that people only go to the cinema to see new films.

    Bullshit. People go to see films in the cinema because watching films in the cinema is fun.

    Also, Sing-along Grease night [glasgowfilm.org]

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