Speaking at the Hollywood financial forum, MoviePass CEO Mitch Lowe said that the company collects information about the location of its customers.
The service MoviePass sells tickets to visit movie theatres and attracts new users by consistantly reducing the cost of a monthly subscription. In early 2018, the number of subscribers to the service exceeded two million. Users can buy tickets through the mobile application and also receive a MasterCard debit card, through which they can pay for tickets at the theatre box office.
Lowe said that with the help of mobile applications, the company has been tracking how users go from their home to the cinema and also where users go after the movie. All the while, users did not know that the service records their movement.
Later, the company said that they do not intend to sell this data and was only collecting it to improve the interaction of users and provide them with the best service. Based on the users’ location, MoviePass would provide the best and most interesting offers as well as provide discounts on transportation and restaurants located near the cinema.
MoviePass conducted market research and is seeking ways to generate additional profits. Many analysts believe the company’s business model is ambiguous because the monthly subscription of MoviePass is already cheaper than the average price of a movie ticket in the U.S. This means that if users use the subscription too often the company will lose money.
Using customer data, the company wants to create a more convenient service that will be beneficial for both MoviePass and its customers.
However, such arguments may not satisfy subscribers who care about privacy. In addition, users recently noticed that the service is not objective in its recommendations, promoting one movie and also preventing the purchase of tickets for others.