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MoviePass refunds annual subscribers as it further restricts member benefits

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All previous annual plans have been converted to limited monthly ones, to ‘capture the needs of the community’

Photo by Vjeran Pavic / The Verge

The struggling movie subscription service MoviePass has sent an email to members who have annual subscriptions, forcing them onto the same terms as monthly subscribers and offering them prorated refunds if they want to cancel their membership instead.

“We want to thank you for being a loyal member of our annual MoviePass plan. Your commitment to MoviePass has contributed to making our vision for an accessible and affordable moviegoing experience a reality,” reads the email. “After experimenting with different models and options, we believe that our current monthly plan captures the need of our community — keeping prices low while continually striving to offer a wider selection of films.”

The measure is a continuation of the company’s plan to slow its significant cash outflow, per recent subscription changes announced earlier this month. The new plan, which previously only affected month-to-month subscribers, restricts users to seeing three movies every 30 days, rather than the previous movie-per-day plan. That restriction coincided with a broad policy on blacking out member access to wide-release first-run films, starting with Mission: Impossible — Fallout in July.

Typically, companies only significantly change service terms for existing members on their renewal dates, with the assumption that members signed on under one set of terms and are guaranteed those terms for the duration of their service. Until now, annual MoviePass subscribers have been immune to the service changes hitting monthly users. MoviePass only offered the annual subscription during limited time offers periods last fall, mostly as a way to lock members into a longer contract. It’s revived the plan sporadically with strange partnership offers attached, usually for brief windows of time, since then.

The monthly MoviePass fee is $9.95, but the temporary annual deal cost $89.95 up front. Over the ensuing nine months, MoviePass has changed its service drastically, most notably by introducing surge pricing and ticket verification, altering both the price of its subscription and the number of movies members can see per month. Most recently, it restricted members to a limited menu of available films.

Throughout this tumultuous period, annual subscribers have seen comparatively little change. But, effectively, MoviePass is now canceling all annual plans and reinstating them as monthly ones that remain paid out until December.

The company says this will help it “expand its offering” of films:

As of today, aligned with Section 2.4 of our Terms of Use, your annual subscription plan will now allow you to see 3 movies a month instead of the previous unlimited offering, and you’ll receive up to a $5.00 discount on any additional movie tickets purchased. This is the current standard plan now in effect for all current and new subscribers. Unless you choose to cancel your subscription prematurely, your plan will continue within these guidelines through the end of your annual contract. Additionally, in making these adjustments to our annual plans, we intend to expand our offering of blockbuster and independent films so you can discover a wider variety of movies.

The company is citing its Terms of Use because it knows changing the terms of a contract prior to the renewal date may subject it to a class action lawsuit. (Shareholders are already suing MoviePass’ parent company for fraud.) MoviePass’ terms, however, state that any portion of its service can be changed or “interrupted” as it so pleases. According to the official disclaimer section of the company’s December 2017 Terms of Use, provided to The Verge by MoviePass, “Your sole remedy against MoviePass for dissatisfaction with the service, site or any content is to stop using the service, site or such content.”

It’s unclear whether this would hold up in court, but MoviePass clearly wants to keep its annual members placated. “If this new plan no longer aligns with your viewing preferences, we completely understand and would be happy to offer you a refund for the remainder of your annual subscription,” reads the email.

MoviePass is giving annual members one week, until August 31st, to either cancel their plan or accept the new monthly subscription and conditions. But for annual and monthly members alike, the service has been close to useless since at least mid-July, when MoviePass began blacking out new films seemingly across the board. Since then, the service has suffered outages and imposed full-scale theater blackouts. The good news: the alternative movie subscription services are looking more attractive by the day.