MoviePass: A Netflix for Moviegoers?
(6 pages of text)
Case (Pub Mat)
MoviePass provided a subscription-based service that allowed its users to see films in theatres for a monthly fee. The company rose to stardom between 2016 and 2017, but in mid-2018, it suffered crushing financial losses when operating costs increased and ancillary revenues were too slow to materialize. The company’s subscription base shrank sharply following the introduction of restrictions on its service and an announcement of a price increase. Helios and Matheson Analytics Inc. (H&M), MoviePass’s parent company, would be de-listed if its stock price remained below the threshold stipulated by the NASDAQ Composite Index (i.e., US$1 per share). The chief executive officer of MoviePass and its management team had to keep the company afloat while trying to regain MoviePass’s lost momentum. How could they revitalize the once-promising upstart and prevent H&M from being de-listed?
This case is suitable for use in undergraduate- and graduate-level courses on strategy or general management. Given its focus on business model analysis, it is also well suited for marketing or entrepreneurship courses. After working through the case and assignment questions, students will be able to
- assess the key elements of a business model and the interdependencies among these elements;
- understand why business models may not be easily transplanted from one company or industry to another;
- explore the underlying drivers of a successful business model;
- examine the priorities of and power relationship among stakeholders within an industry; and
- understand the priorities of various players in the dynamic “ecosystem” of the movie industry.
Information, Media & Telecommunications
United States, Small, 2018
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