Former MoviePass CEO Mitch Lowe Pleads Guilty to Securities Fraud Conspiracy (variety.com)
- Reference: 0175009385
- News link: https://yro.slashdot.org/story/24/09/16/2221244/former-moviepass-ceo-mitch-lowe-pleads-guilty-to-securities-fraud-conspiracy
- Source link: https://variety.com/2024/film/news/mitch-lowe-moviepass-securities-fraud-guilty-conspiracy-1236146013/
> Farnsworth and Lowe were the architects of MoviePass' doomed all-you-can-watch offering, which resulted in hundreds of millions of dollars in investor losses in 2017 and 2018. Investigators found that Lowe tried to stem the losses by throttling the service, forcing high-volume users to reset their passwords and verify their tickets. The two men were charged in November 2022 on counts of wire fraud and securities fraud. According to Lowe's plea agreement, the government estimates the total losses from the scheme at $303 million -- though Lowe contends it is less than that. Lowe remains free on bond, and is due back in court in Miami on March 21 for a status conference. Lowe published [4]a memoir in 2022 in which he reflected on the downfall of MoviePass, entitled "Watch and Learn: How I Turned Hollywood Upside Down with Netflix, Redbox, and Moviepass."
[1] https://variety.com/2024/film/news/mitch-lowe-moviepass-securities-fraud-guilty-conspiracy-1236146013/
[2] https://yro.slashdot.org/story/22/11/04/2238259/the-execs-behind-the-moviepass-debacle-are-now-facing-criminal-charges
[3] https://entertainment.slashdot.org/story/17/08/15/1557222/netflix-co-founders-crazy-plan-pay-10-a-month-go-to-the-movies-all-you-want
[4] https://www.amazon.com/Watch-Learn-Hollywood-MoviePass_Lessons-Disruption/dp/0306827263
He sould be sentenced to 20 years ... (Score:1)
... of having to watch dreadful movies over and over again.*
* and paying $9.95/month for the privilage
Why exactly did investors fall for it? (Score:3)
How did anyone think MoviePass would be able to charge just $10 per month, less than the cost of a single movie ticket, for unlimited movies? Did they think the company would "make up for it in volume"? Maybe they thought the company would become so powerful that theaters would be forced to accept its terms? I didn't get it then, or now.
Re: (Score:1)
Consider the possibility that they might have had a different business model than simply "customer buys pass, company makes money". Google is free, FM radio is free, Robinhood is free. There's a reason why these companies stay in business.
Re: (Score:2)
Clearly, MoviePass never figured out how to...stay in business.
Re: (Score:2)
> Maybe they thought the company would become so powerful that theaters would be forced to accept its terms?
Maybe I am misremembering but isnt that what they sortof explicitly stated at the time? They were going to run at a loss to lure in subscribers to the concept with the idea of once people are used to the concept they could raise the price and force negotiations with the theater chains based on the huge built in subscriber base?
Re: (Score:1)
movie theaters make most of their money on the concession stand selling $1 for popcorn for $8 , $1 drink for 6 , etc Unlimited was never gonna work but something like $25 a month with max 8 movies might had worked.
I Just Lied! (Score:3)
Lowe published a memoir in 2022 in which he reflected on the downfall of MoviePass, entitled "Watch and Learn: How I Turned Hollywood Upside Down with Netflix, Redbox, and Moviepass."
Re: (Score:2)
I suppose it depends on how you interpret the phrase "upside down." I mean, he certainly turned MoviePass and Redbox "upside down" if that means they went bankrupt! Maybe Netflix is next...