AMC isn’t pleased with the new subscription-based service MoviePass, Variety reports.
AMC Theaters released a statement to Variety on Tuesday and threatened legal action against the service just hours after MoviePass announced its new pricing model, which would allow customers to pay less than $10 a month and see a movie every day.
AMC called MoviePass “a small fringe player” and said the model “is not in the best interest of moviegoers, movie theatres and movie studios.”
The statement comes as AMC’s own stock has taken a hit with lower projections for the year. Most of this is because lower box office numbers have plagued movie theaters this year.
MoviePass announced Tuesday that it would have a new pricing model, one that is different than its previous plan, where customers were charged based on location, according to the Deseret News.
MoviePass resells the tickets to customers, purchasing them at a full price through a debit card. The company said it boosts attendance to theaters, Variety reported.
This new pricing plan allows the company to do market research so they can find out what movies people want to see, the Deseret News reported.
The company also announced Tuesday that it sold its majority stake in Helios and Matheson Analytics Inc., giving it the financial room to start this new service, according to Bloomberg.
MoviePass CEO Mitch Lowe told Variety he’s worried that AMC’s stance on the issue could hurt how customers see his company.
“I’m not worried about it killing the sale,” he said. “What I’m worried about is it confusing customers and making them believe they can’t use this service at AMC theaters.”
AMC said in a statement that MoviePass will lose money. Since its own ticket prices go for $9.33, two tickets would already put the company behind, “losing money on every subscriber seeing two movies or more in a month,” the statement said, according the Variety.
Current movie ticket prices nationwide go for an average of $8.84, according to The Hollywood Reporter.
The two companies previously worked together in a pilot program in select theaters. MoviePass even uses data from that program to sell its new subscription.
Lowe told Variety that he’s aware the company will lose money.
But he said more companies will support him once they see its success. He hopes that theater owners will pay the company back through advertising.
“There must be some way to make us whole,” said Lowe. “We know we have to prove the value we deliver and, at that point in time, where we’re delivering value to studios and theaters, we can work together with them in a constructive manner so that everybody makes more money.”