MoviePass,MoviePass CEO proudly says it’s ‘exploring’ gathering location data on users , , II MoviePass wants in on every aspect of your movie night

MoviePass responded late this evening to a number of reports calling into question the company’s privacy policy after CEO Mitch Lowe publicly claimed the theater subscription service tracks its users’ locations. A spokesperson for the company clarified that MoviePass has no intentions to sell this data, and the company at the moment is only “exploring” utilizing location-based marketing as a way to “enhance the overall experience by creating more opportunities” for subscribers to “enjoy all the various elements of a good movie night.”

Use of location-based data is mentioned only once in MoviePass’ privacy policy, which says a user’s location is checked only to verify whether they are in fact nearby the specified theater they intend to purchase a movie ticket from.

The controversy arose from a talk featuring Lowe, as part of the MoviePass CEO’s keynote at the Entertainment Finance Forum in Los Angeles late last week. “We get an enormous amount of information,” Lowe told the crowd, according to a report from Media Play News published on March 2nd. “We watch how you drive from home to the movies... [and] we watch where you go afterwards.” The quotes caused alarm among technology journalists and MoviePass subscribers, some of whom took to Twitter to decry the service’s use of personal data.

MoviePass, in its statement, says the data it wants to collect is intended to help inform the company’s understanding of the overall moviegoing experience, including how users get to the movie theater and where they may eat out before or after the film. “We will use [the data] to better inform how to market potential customer benefits including discounts on transportation, coupons for nearby restaurants, and other similar opportunities,” the statement reads.

 

Lowe himself mentioned this during his talk at the Entertainment Finance Forum, saying one of MoviePass’ long-term goals is to create a pipeline of discounts and other business partnerships that grant the company a cut of third-party revenues, to account for the loss it may be taking on ticket stubs. MoviePass has already partnered with some independent theater chains for a cut on ticket revenue and food and drink sales, something the company is reportedly wants from larger chains like AMC.

ust last week, MoviePass mysteriously prevented users in select markets from buying tickets to see Red Sparrow, while promoting the movie to subscribers in other markets. That suggests MoviePass is also looking into using email and app-based marketing as a way to cut promotional deals with studios, and may have tested a Red Sparrow blackout to bolster its claims that it drives a significant amount of traffic to movies it actively promotes.

Still, this confusion around its location tracking isn’t a great look for MoviePass, which may have trouble escaping the ire of privacy advocates who feel the company has stepped out of line by even proposing a data-based monetization strategy that tracks users’ habits outside the theater. Granted, there’s no indication the company does this now, or that it will not update its privacy policy to make clear when it starts doing so. It will be hard, however, to undue the perception Lowe’s comments have created.

Here’s MoviePass’ statement in full:

At MoviePass our vision is to build a complete night out at the movies. We are exploring utilizing location-based marketing as a way to help enhance the overall experience by creating more opportunities for our subscribers to enjoy all the various elements of a good movie night. We will not be selling the data that we gather. Rather, we will use it to better inform how to market potential customer benefits including discounts on transportation, coupons for nearby restaurants, and other similar opportunities. Our larger goal is to deliver a complete moviegoing experience at a price anyone can afford and everyone can enjoy.

Everyone knew the MoviePass deal is too good to be true — and as is so often the case these days, it turns out you’re not the customer, you’re the product. And in this case they’re not even attempting to camouflage that. Mitch Lowe, the company’s CEO, told an audience at a Hollywood event that “we know all about you.”

Lowe was giving the keynote at the Entertainment Finance Forum; his talk was entitled “Data is the New Oil: How will MoviePass Monetize It?” Media Play News first reported his remarks.
“We get an enormous amount of information,” Lowe continued. “We watch how you drive from home to the movies. We watch where you go afterwards.”
It’s no secret that MoviePass is planning on making hay out of the data collected through its service. But what I imagined, and what I think most people imagined, was that it would be interesting next-generation data about ticket sales, movie browsing, A/B testing on promotions in the app and so on.
I didn’t imagine that the app would be tracking your location before you even left your home, and then follow you while you drive back or head out for a drink afterwards. Did you?
It sure isn’t in the company’s privacy policy, which in relation to location tracking discloses only a “single request” when selecting a theater, which will “only be used as a means to develop, improve, and personalize the service.” Which part of development requires them to track you before and after you see the movie?
Naturally I contacted MoviePass for comment and will update if I hear back. But it’s pretty hard to misinterpret Lowe’s words.

 

The startup’s plan is to “build a night at the movies,” perhaps complete with setting up parking or ordering you a car, giving you a deal on dinner before or after, connecting you with like-minded moviegoers, etc. Of course they need data to do that, but one would hope that the collection would be a bit more nuanced than this.
People clearly value the service, because it essentially lets them use someone else’s credit card instead of their own at the movies (and one belonging to a bunch of venture capitalists at that). Who would say no? Some people sure might, if they knew their activities were being tracked at this granularity (and, it has to be said, with such a cavalier attitude) to be packaged up and sold. (Good luck with the GDPR, by the way.)
Hopefully MoviePass can explain exactly what data it collects and what it does with it, so everyone can make an informed choice.
Update: In a statement, a MoviePass representative says:

We are exploring utilizing location-based marketing as a way to help enhance the overall experience by creating more opportunities for our subscribers to enjoy all the various elements of a good movie night. We will not be selling the data that we gather. Rather, we will use it to better inform how to market potential customer benefits including discounts on transportation, coupons for nearby restaurants, and other similar opportunities.

I’ve also asked for information on what location data specifically is collected, for how long before and after a movie users are tracked, and where these policies are disclosed to users.
MoviePass—the Netflix for cinemas that gets theatergoers into a 2D movie each day for a flat $9.95 monthly fee—is looking beyond the movie theater to make money. It wants a piece of every aspect of your movie night, from dinner beforehand to drinks afterward.
The company plans to use the data it gathers on subscribers, including where they live, when and where they go to the movies, and what they do before and after, to take a cut from businesses that want to get in on the theatergoing experience.
MoviePass has subscribers’s mailing and billing addresses, and its customers grant the company access to their locations via its app to find showtimes and check in to theaters. “We get an enormous amount of information,” CEO Mitch Lowe said at Winston Baker’s Entertainment Finance Forum on Mar. 2, Media Play News reported. “We watch how you drive from home to the movies. We watch where you go afterwards.”
It’s already doing something similar with cinemas. It pays theater operators for each ticket MoviePass subscribers use—banking on a gym-like model where some customers won’t go to theaters regularly and subsidize the cost of those who do. It’s also cutting deals with exhibitors to get discounts on the ticket price or money back for the theatergoers it sends to them. And it’s looking to land similar revenue-sharing deals for concessions, so it can make money from the popcorn, candy, and sodas that its subscribers buy at cinemas. It recently cut ties with 10 AMC locations for refusing to play ball on either front.
Revenue-sharing deals with restaurants and other vendors are the next step, Lowe said. “Our bigger vision is to build a night at the movies,” he said.
MoviePass also has to show it can be profitable at the low rate of $9.95 per month per subscriber for nearly unlimited viewing. That’s not much more than the roughly $9 the average movie ticket costs in the US. The seven-year-old company, majority owned by Helios and Matheson Analytics, has about 2 million subscribers.
The company has turned to other revenue streams, as well. Movie studios pay the service to promote films like Lady Bird and I, Tonya to subscribers. Earlier this year, it began investing in indie movies, betting that its users will make them more valuable; audiences are more willing to take risks on a lesser known titles when they’re baked into the cost of their subscriptions.