MoviePass couldn’t afford to pay for movie tickets on Thursday
If MoviePass fails, it&#x27;s a failure of the Nash equilibrium due to stubbornness and lack of communication. MoviePass drives traffic to movies, benefiting both studios and theaters. Despite the existence of other subscription plans, if MP goes away, the majority of those tickets will never be purchased. MP could certainly have evolved into a sustainable plan, that restricted its users to seeing movies at off-times with low demand, at nearly 100% marginal profit to the theaters, even if those tickets were sold at a significant discount that MP could reasonably afford.<p>Instead, theaters, especially AMC, refused to negotiate and in doing so, shot themselves in the foot. AMC&#x27;s subscription plan is especially attractive to high-volume users on which it will likely lose money, further, it encourages them to use their free tickets at peak times for the most popular movies in the most expensive formats. When an AMC subscriber in NYC reserves a seat for a Marvel film in IMAX on opening weekend, that&#x27;s a $20+ ticket that AMC can&#x27;t sell to a paying customer because the theater is sold out. AMC&#x27;s profit margin is already quite thin, and getting worse, according to its financial filings. Its CEO is very full of himself but doesn&#x27;t seem like much of a strategist.