If anyone was unconvinced that MoviePass isn’t long for this world, an incident on Thursday night may have erased all doubt. Last night, MoviePass users found that they were unable to use the service. At around 8:45 PM, the official MoviePass Twitter account warned users that they were “experiencing technical issues with our card-based check-in process,” and now we know why. Believe it or not, MoviePass ran out of money.
According to Business Insider, MoviePass owner Helios and Matheson Analytics on Friday disclosed to the Securities and Exchange Commission that it was forced to borrow $5 million in cash in order to make required payments to keep the service up and running. For a short time, MoviePass literally couldn’t afford to keep the lights on.
“The $5.0 million cash proceeds received from the Demand Note will be used by the Company to pay the Company’s merchant and fulfillment processors,” the SEC filing explained. “If the Company is unable to make required payments to its merchant and fulfillment processors, the merchant and fulfillment processors may cease processing payments for MoviePass, Inc. (‘MoviePass’), which would cause a MoviePass service interruption. Such a service interruption occurred on July 26, 2018.”
MoviePass users were reportedly still running into issues while using the app on Friday morning. As for social media outreach, it has yet to follow up on its tweets from last night to let subscribers know why there was an issue or if there will be any form of compensation or even an official explanation for the incident.
We’ve known for quite some time that MoviePass was in trouble, but this feels like it could be a breaking point. If the service can’t make it through a random Thursday night, how does Helios and Matheson expect to keep the ship afloat for months and years to come? We’ll update this post if any more information comes to light.