But not for the reasons you think. It seems MoviePass’s owner, Helios and Matheson Analytics (HMNY), is a bit embarrassed by all the bad press the movie ticketing company is getting and thus wants to segregate it from its parent company. As Ted Farnsworth, chairman and CEO of HMNY, said in a press release announcing the plans:
For many years, HMNY has been focused on data analytics, and in that capacity we own assets like Zone Technologies which provides a safety and navigation app for iOS and Android users and a global security concierge service. Since we acquired control of MoviePass in December 2017, HMNY largely has become synonymous with MoviePass in the public’s eye, leading us to believe that our shareholders and the market perception of HMNY might benefit from separating our movie-related assets from the rest of our company.
While Farnsworth doesn’t explicitly say that MoviePass’s problems are bad optics for HMNY, it’s easy to read between the lines as we’ve never heard an explanation like this for spinning off a company before.
MoviePass started off as a consumer darling, allowing people to see as many movies in cinemas as they wanted for one low monthly subscription fee. But since then the company has been forced to change its pricing and subscription benefits numerous times and has even engaged in dubious practices to force prior subscribers to return to the service. Not only that, but HMNY is now under investigation by the New York attorney general’s office to determine whether the company has misled investors.
No wonder HMNY wants to separate itself from MoviePass as soon as it can.