MoviePass Returns As a Crypto-Fueled Privacy Nightmare

@canterrain

Feb 10, 2022, 5:18 pm EST
| 5 min read

Do you remember MoviePass? The failed “movie subscription service” all but burned to the ground when it made a promise no company could keep: all the movies you ever want to see for less than a price of a ticket. And now it’s back! This time with virtual currency and privacy nightmares.

MoviePass really was a deal too good to be true. For $10 a month, you could see all the movies you wanted at any theater. Even if the theaters didn’t like it. MoviePass sent you a debit card, and you’d buy your ticket. You couldn’t share with a friend, but hey, just get two subscriptions! There was no way it could last, and the company quickly started losing money. Then altering the deal and dropping theater support until it finally came crashing down.

A lot of that happened after one of the original co-founders, Stacy Spikes, was fired. Since then, he managed to repurchase the rights to the company through the bankruptcy process, and now he’s (almost) ready to re-launch MoviePass. In a nearly hour-long presentation (with multiple technical and human glitches), he provided … well, some detail of the plan. But we’re left with more questions and fears than certainty.

No Word On Pricing Or Launch Date

So let’s get some of what we don’t know out of the way. Nowhere in the presentation did Spikes give us an indication of how much MoviePass 2.0 will cost. Nor did he provide an exact launch date, just a vague “Summer” promise. He did imply that the subscription service would have a tiered offering, but not what differed in those tiers.

I think we can assume, though, that the “all you can watch for just $10 a month” offering won’t make a return. That led to the company’s demise after all, and Spikes spent a while poking fun of that history. But some of his comments did suggest the direction MoviePass will look towards.

In a rather honest moment, Spikes admitted that even at its height, MovePass subscribers didn’t bump the numbers on large tentpole movies like Spider-Man with all their visits. It was the smaller movies, the kind you might see nominated for an Oscar but never actually watched yourself, that saw benefits. MoviePass subscribers, according to Spikes, used the service as a chance not to save money so much as give movies they might have otherwise passed on a chance.

It sounds like MoviePass will use that data as a starting point for its new subscription service. It all sounded sensible until the pseudo crypto and privacy nightmare details slipped out.

Is This Crypto?

Let’s get one thing straight right out of the gate: at no time did Spikes utter the words “crypto” or “cryptocurrency.” I’d be remiss if I didn’t mention that. MoviePass isn’t claiming that it’s creating a crypto service. But I will call this an “if it looks, swings, and quacks like a duck” moment.

The MovePass looks like crypto due to several details. First, there’s a vague promise that what MoviePass is building will be an “End to End Cinematic Marketplace powered by Web3 Technology.” If you’re not familiar with the term Web3, don’t feel bad because it’s not well defined at this point. As our sister-site How-To Geek explains, it’s a proposed third evolution of the internet, powered by the blockchain and therefore decentralized. A little bit like the NFT marketplace.

But just because something’s decentralized and powered by blockchain doesn’t mean it’s cryptocurrency. But the next part is telling. You see, rather than paying a certain amount of money each month and then getting “six movie tickets” or some such, MoviePass 2.0 will instead rely on “virtual currency.” You’ll have a digital wallet filled with virtual currency, and you’ll spend it on movie tickets or concessions. Currency rolls over from month to month (though it wasn’t clear how much or for how long), and you can use it to bring a friend to the movie.

You can even trade your MoviePass tokens if you want, though how exactly isn’t clear. MoviePass stopped just short of calling this MoviePassCoin, but you can see the resemblance. Movie theaters will charge differents for tickets and concessions depending on the time of day, so much like most cryptocurrencies, the value will fluctuate. You can even earn more of the “virtual currency” through actions, which acts similar to crypto’s “proof of work” scheme. Oh, but earning the currency is somewhat scary from a privacy standpoint.

Earning Virtual Currency Means Giving Up Your Face and Location

Towards the end of the presentation, Spikes showed off a little bit of the upcoming MoviePass app and hero feature called PreShow. PreShow will let you earn virtual currency without having to buy more. Though presumably there will be multiple ways to do this, one of the initial methods is watching ads. As you’re browsing movie options, you’ll see a PreShow feature. Click on that, watch an ad, and you’ll see currency deposited into your virtual wallet.

Spikes hinted that the offers could go beyond video and suggested during the demonstration that an ad for a self-driving taxi could then offer even more virtual currency if you booked a ride to the theater. If any of this sounds familiar, you’re probably an eagle-eyed reader who remembers Stacy Spikes’ Kickstarter.

That Kickstarter promised an upcoming app dubbed PreShow that would let you see “first-run movies for free” simply by watching ads on your phone. The updates and comments in the Kickstarter suggest that despite raising $56,721, the app never delivered as promised, and at one point pivoted to a gaming solution instead of ads.

Now it seems PreShow will find new life as a part of MoviePass. Watching ads isn’t much a privacy issue unless you count how frequently they track us, that is. But in this case, you’re giving up more data than usual. The last thing MoviePass or its ad partners want is for you to start an ad video, set down your phone, and walk away. You’d still get the virtual currency, but the ad-makers lose out on eyeballs.

The solution MoviePass employs is facial recognition. Your phone will fire up its cameras to ensure you’re paying attention when you start the movie. Look away, and the ad pauses. What methods does MoviePass use to determine you’re looking at the phone? Does it store face data on the phone or in the cloud? Does it transmit data to the cloud about your viewing habit? We don’t know because Spikes didn’t tell us.

But we can say with certainty that MoviePass will know where you are. That’s necessary to offer movie ticket prices to the theater of your choice. And to help a robotaxi deliver an offer to pick you up from wherever you are. The ad service would need to know you live in an area that makes sense for the ad. After all, there is no sense in promoting a taxi service that doesn’t exist near you.

So that leaves us with sizeable scary privacy implications: how secure is the MoviePass app? How much data does it have about you? How does it determine you’re looking at the phone? What information is stored where? And will MoviePass sell any of that data? If it does, will it anonymize that data? Right now, we just don’t know.

Over time we might get answers, and they may even satisfy and quell any privacy fears involved. But until that happens, having more questions than answers isn’t a great place to be. We’ll let you know when MoviePass tells us more.