MoviePass says app tracks user location after they leave theaters, CEO says [u]
The CEO of MoviePass, a popular iOS app and subscription service that lets customers watch a movie a day, caused a bit of a stir in announcing the software tracks user locations via GPS after trips to the theater.
In a recent talk at the Entertainment Finance Forum, first reported by Media Play News last week and subsequently highlighted by TechCrunch on Monday, MoviePass CEO Mitch Lowe offered insight into the company's financial structure, specifically how the firm is able to offer its users a movie a day with a $9.95 per month subscription.
Currently, MoviePass pays theaters the going rate for each ticket, but is looking to garner discounts and revenue sharing deals in exchange for driving traffic, the report said. Prior to Lowe's talk, MoviePass has been for the most part vague on the inner workings of its financial model.
Perhaps more interesting, or for some concerning, is that the app gleans location information from its users.
"We get an enormous amount of information," Lowe said. "We watch how you drive from home to the movies. We watch where you go afterwards."
Beyond GPS-based user tracking, the firm also knows user addresses, which is helpful in determining demographic segment information.
Lowe hinted at potential user data collection and monetization practices during an interview with Recode last month.
"Netflix buys $8 billion of content a year, and believe me, they have to borrow the money to do it. Or companies like Facebook -- it's free, but they're monetizing all the advertising and all the data about you. That's exactly what we are [doing]."
For its part, Lowe said the location tracking feature will one day allow MoviePass to build out user-facing services that span far beyond the theater. For example, the information might be leveraged to suggest nearby restaurants to users looking for a bite before or after a show. These vendors would presumably pay MoviePass a small portion of proceeds for the recommendation.
"Our bigger vision is to build a night at the movies," Lowe said.
Location tracking is alluded to in MoviePass' privacy policy, which notes the app requires access to a user's location when selecting a theater. The information collected in a "single request" to iPhone hardware will also be used to "develop, improve and personalize the service," the firm says.
User tracking is a hot button topic in the smartphone world. For Apple, the issue dates back to at least 2011, when it was discovered that iOS 4 regularly logged location data from iPhones and iPads. Subsequent scrutiny from the media and the U.S. government prompted quick action from Apple, which with iOS 5 began to limit access to unique device identifiers (UDIDs) previously used by apps to track users.
Reports on Lowe's talk were published just days after Apple threw a spotlight on MoviePass in the iOS App Store. In a "Meet the Developer" segment posted late last month, founders Stacy Spikes and Hamett Watt touted iPhone as key to the development and success of MoviePass.
"The idea was almost too early," Spikes said, referencing an earlier attempt at an all-you-can-eat business model he kickstarted in the late 1990s. "We didn't have iPhones and apps to figure out payment and interfacing. If it weren't for that development, MoviePass would never have happened."
Update: In a response to The Verge, MediaPass said it is only exploring the use of location-based marketing to enhance user experiences, promising that any collected data would not be sold to third-parties. As Lowe said, any data harvested from its app would be put toward the creation of a more complete and entertaining movie night experience.
In a recent talk at the Entertainment Finance Forum, first reported by Media Play News last week and subsequently highlighted by TechCrunch on Monday, MoviePass CEO Mitch Lowe offered insight into the company's financial structure, specifically how the firm is able to offer its users a movie a day with a $9.95 per month subscription.
Currently, MoviePass pays theaters the going rate for each ticket, but is looking to garner discounts and revenue sharing deals in exchange for driving traffic, the report said. Prior to Lowe's talk, MoviePass has been for the most part vague on the inner workings of its financial model.
Perhaps more interesting, or for some concerning, is that the app gleans location information from its users.
"We get an enormous amount of information," Lowe said. "We watch how you drive from home to the movies. We watch where you go afterwards."
Beyond GPS-based user tracking, the firm also knows user addresses, which is helpful in determining demographic segment information.
Lowe hinted at potential user data collection and monetization practices during an interview with Recode last month.
"Netflix buys $8 billion of content a year, and believe me, they have to borrow the money to do it. Or companies like Facebook -- it's free, but they're monetizing all the advertising and all the data about you. That's exactly what we are [doing]."
For its part, Lowe said the location tracking feature will one day allow MoviePass to build out user-facing services that span far beyond the theater. For example, the information might be leveraged to suggest nearby restaurants to users looking for a bite before or after a show. These vendors would presumably pay MoviePass a small portion of proceeds for the recommendation.
"Our bigger vision is to build a night at the movies," Lowe said.
Location tracking is alluded to in MoviePass' privacy policy, which notes the app requires access to a user's location when selecting a theater. The information collected in a "single request" to iPhone hardware will also be used to "develop, improve and personalize the service," the firm says.
User tracking is a hot button topic in the smartphone world. For Apple, the issue dates back to at least 2011, when it was discovered that iOS 4 regularly logged location data from iPhones and iPads. Subsequent scrutiny from the media and the U.S. government prompted quick action from Apple, which with iOS 5 began to limit access to unique device identifiers (UDIDs) previously used by apps to track users.
Reports on Lowe's talk were published just days after Apple threw a spotlight on MoviePass in the iOS App Store. In a "Meet the Developer" segment posted late last month, founders Stacy Spikes and Hamett Watt touted iPhone as key to the development and success of MoviePass.
"The idea was almost too early," Spikes said, referencing an earlier attempt at an all-you-can-eat business model he kickstarted in the late 1990s. "We didn't have iPhones and apps to figure out payment and interfacing. If it weren't for that development, MoviePass would never have happened."
Update: In a response to The Verge, MediaPass said it is only exploring the use of location-based marketing to enhance user experiences, promising that any collected data would not be sold to third-parties. As Lowe said, any data harvested from its app would be put toward the creation of a more complete and entertaining movie night experience.
At MoviePass our vision is to build a complete night out at the movies. We are exploring utilizing location-based marketing as a way to help enhance the overall experience by creating more opportunities for our subscribers to enjoy all the various elements of a good movie night. We will not be selling the data that we gather. Rather, we will use it to better inform how to market potential customer benefits including discounts on transportation, coupons for nearby restaurants, and other similar opportunities. Our larger goal is to deliver a complete moviegoing experience at a price anyone can afford and everyone can enjoy.
Comments
What I don't understand are why people are having a problem using a service that is technically free, or heavily discounted for the user... and then get upset that the provider is collecting information about you in order to make ends meet on the back side in order to remain profitable. People don't want to pay money to use exclusive services, so this is how online companies make money off of you. Otherwise, many things we take for granted on our phones simply would not exist.
I stopped using Uber because they only had the options always or never.
I agree with Roake, 'This kind of crap is our future.'
No, it doesn't require you to keep location tracking on if you want to use it. The only requirement is that location tracking is on when you choose a movie as you have to be within 100 yards do so which will then allow the MoviePass MC card to work for that theater. As stated by others you can adjust what the app accesses in Settings.
Is it your first inclination to automatically assume that the "free" product you're using doesn't come with a price tag attached elsewhere?
Many people blame Apple for poor battery life when they have about a dozen of these apps that are running and using location services and background refresh and have no idea what those things are.
Personally, I don't care. If I had to fill out a 5 minute survey after the movie in order to use it the next time I would. I already post to FB that I'm watching this or that movie so that company already has data on me, not to mention whatever their app can record about my location and other comments. Less than $80 for all the movies I want to see in a year is saving me hundreds of dollars.
From people I've talked to, they're seeing more movies and spending more at concession stands so the company has a case to get reduction in their direct costs from the theater. I assume that no one will play ball and this service will fizzle out in time with theater chains offering a similar, but lesser option that costs more money, but either way I've already saved money which means every movie I watch in 2018 is free up until my annual pass expires around Oct, I think.
Well dang, I never even noticed, thanks for pointing that out.