CULTURE

10 Failed Launches More Embarrassing Than the Iowa Caucus App

Primary season is off to a rocky start, but the Democrats have a lot of competition for awful launches

Political junkies went to bed Monday night with reports of delayed results out of the Iowa caucuses, expecting that the mess would be cleared up by morning.

Those expectations were sadly mistaken, and Tuesday morning came and went with no sign of an official delegate count forthcoming. Most sources are pointing to a faulty app developed for the Iowa Democratic Party by a shadowy organization known as...Shadow Inc, because our reality has been undergoing a writer's strike since 2016. Shadow Inc. is run by some alums from Hillary Clinton's 2016 campaign—because we are never allowed to forget Hillary Clinton—and associated with the non-profit organization ACRONYM, which doesn't stand for anything (again, writers strike) but is committed to "building tech infrastructure for the progressive movement."

Intended to make result tabulation fast and simple, replacing the traditional phone-in system, the app was developed in just the past few months. The quick development time was apparently streamlined by just skipping over the debugging step to have it "ready" in time for its dramatic premier. As a result, the caucus process was soon overwhelmed by technical issues as party officials struggled with crashes and inconsistencies that left them with no choice but to rely on the old-fashioned tallying and the paper trail kept as a backup.

Meanwhile, multiple campaigns are already reporting their internal results—with Sanders in the lead and Buttigieg not far behind—and the world is largely moving on from the mess with little real consequence beyond the renewed and unifying awareness of the incompetent management within the Democratic Party—even President Trump came through with one of his rare correct takes.

But it's worth keeping in mind that the Democrats are not alone in this. The history of disastrous failed launches is long and glorious, and these are but a few highlights.

Healthcare.gov

healthcare.gov

Okay, the Democrats aren't alone, but this also isn't their first foray into launch failure. When the Affordable Care Act passed in 2010, contractors were brought on to develop the website based on obsolete criteria and with little oversight, resulting in code that was full of placeholder text and a system that crashed almost immediately. Only six people were able to use the system to actually select an insurance plan on Healthcare.gov's first day. After two months of cleanup, the website was largely usable, but the trash-fire of the launch still resulted in the resignation of HHS Secretary Kathleen Sebelius and a congressional investigation into the whole mess.

Trump Steaks

trump steaks

Just to be fair, it's worth taking a look across the aisle at probably the only time in Donald Trump's life when he made a bad business decision. Trump Steaks was a branded effort to sell middling quality steaks at a steep mark-up using the image of a man who like his meat served well-done with a heavy dose of ketchup. Billed as "The World's Greatest Steaks," Trump Steaks were sold on QVC and through the Sharper Image Catalog in 2007. Strangely, consumers didn't seem excited to buy overpriced beef from the same services that sell commemorative coins and dog waste vacuums. Both companies stopped featuring the steaks within a few months, and the trademark expired in 2014. Of course, that's just one failure. Probably a fluke.

Windows Vista

Windows Vista

After five years of Windows XP, the numerous vulnerabilities in Microsoft's operating system were causing frequent issues with viruses and malware, and people were excited for an upgrade. Windows Vista was not that. Released in 2006, the clunky user interface, compatibility issues, and frustrating security measures led to hardware companies reverting back to XP. Nonetheless, hundreds of millions of windows users ended up stuck with Vista until Microsoft rushed to release Windows 7 three years later.

GoTrump.com

gotrump.com

Oh, hey, looks like Trump may have made another slight miscalculation here, trying to establish his own branded travel-booking site. The site launched in 2006, promising to lend Donald Trump's famed deal-making skills to your travel booking, with the tagline "The art of the travel deal." Trump predicted that the website would be a "tremendous success." It ceased operation in 2007. Oops. Still, two mistakes ins't bad. Definitely not a pattern.

LaserDisc

laserdisc

LaserDiscs were basically giant CDs with movies on them. Introduced in 1978, they delivered higher quality images than VHS before the invention of DVDs, but they were also about the size of a vinyl record but much more delicate and they weighed about half a pound. The discs could only hold about an hour of video on each side, so they had to be flipped over halfway through a feature film, and the huge, expensive players also produced a lot of noise getting the discs up to speed. Needless to say, the promise of high-quality video at home was not quite worth the numerous downsides, and Laserdiscs never really caught on.

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FILM & TV

R.I.P Moviepass pt. II: an Update

It's a Slow, Painful Passing

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A couple weeks back I wrote an article excoriating the Moviepass company, for having run their business into the ground--for having such a great product, and managing it with such poor execution.

Here's that article. Two weeks later, the question is: if Moviepass was bankrupt in July, why are they still around in August? It turns out, Moviepass is dying like any good movie character: slowly, painfully, with plenty of room for last words. For anyone who's stuck with their subscription and is wondering what in the world is going on, here, below, are some of the highlights--from the bad to the so bad it's funny...

[WARNING: Videos containing movie spoilers below--click at your own peril!]

GOOD: Going bankrupt will make even the most ardent businessmen reconsider their strategies, and Moviepass has tried to come up with some novel ideas about how to stay afloat. For instance, they've proposed charging theaters and studios to market specific movies to their subscribers. In my last article, I referenced a statistic that suggested Moviepass accounted for 3% of domestic ticket sales on average, but 10% for movies they marketed through the app. That data was published by Moviepass, internally. Evidence now suggests they may have been loose with the numbers. With no good data out there, it's hard to say.

BAD: The company keeps setting records for how much money they can lose in how short a period of time. In my last piece I described their stock dropping by orders of magnitude. Now, Moviepass' parent company--Helios and Matheson Analytics--is trading at less than a nickel per share. You really couldn't sell this company for a ham sandwich right now. At least ham has some value.

WORST: Every day the Moviepass app is changing its own rules. On any given time of any given day, you might find zero screenings available in your area, all screenings available in your area, or only two movies but all of their available screenings in your area. Most days, the service is up and running in the morning, then back down by late afternoon time. From a skeptic's point of view, it seems Moviepass would like to create the illusion that they're still alive and kicking, but only during those times of day when people don't actually want to see movies. When it comes to the evening and weekends, the app always seems to be conspicuously, conveniently down...

The creepiest days come when the only movie you can see with a Moviepass card is Slender Man. Search any theater in your area, and each one will only show Slender Man showings. It's already happened more than once. Perhaps this is some kind of message?

UGLIEST: There's desperate, and then there's purposely un-canceling user accounts. If you tried canceling your subscription this month, you may have gotten an email like this: "Please note: if you had previously requested cancellation prior to opting-in, your opt-in to the new plan will take priority and your account will not be cancelled." The best part: if you didn't accept the terms of this new, zombie subscription: too bad! Many users opened their apps to find a message titled "Updates to your Moviepass plan" with only an "I Accept" prompt at the bottom of the screen, no "I reject" or "F*** you!" options.

If you canceled your Moviepass subscription this month, it may be worth your time to call the company and square away the details of the breakup. Chances are, if you get charged again for next month, the company won't have any money for reimbursements.

FUNNIEST: Moviepass, graciously, has given us, the people, one final gift. Have you seen their Twitter lately? @MoviePass has been, arguably, one of the best Twitter accounts all month. Every day, they post some bland marketing material, and every day, hundreds of followers come out of the woodwork to just ceaselessly slam the company for their poor service, turning every otherwise innocuous post into a cesspit of angry complaints, insults and venting. There's even a poor person (or group of poor people) whose job it has been to reply to all of these comments.

If you've become fed up with Moviepass lately, or just enjoy trolling on the internet, I recommend spending 15 minutes on this timeline. Unlike their app, their social media never fails to disappoint, day after day.


Nate Nelson is an NYC-based writer and podcast host.


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R.I.P. Moviepass: the Greatest, Worst Subscription Service

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FILM & TV

R.I.P. Moviepass: the Greatest, Worst Subscription Service

It Certainly Doesn't Seem Like Moviepass Itself is Winning Here.

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At the beginning of 2018, Brian Kinstlinger, an analyst for the investment bank Maxim Group LLC., made a prediction.

Six months earlier, executives at Moviepass Inc. sold a majority stake (estimated just shy of 66%) in their rising company to Helios and Matheson Analytics Inc. (one of those big, vague data companies like "Cambridge Analytica" that sounds just uninteresting enough to arouse suspicion), for an undisclosed sum. As part of the deal, they overhauled their business model, slashing the price of their subscription service 80%. In that week alone, the company's reputation spread by orders of magnitude, and their customer base shot up from the thousands to the millions. By 2018 nearly 2 million Americans had Moviepass, and the company accounted for 3-10% of any given movie's U.S. ticket sales. By all accounts, the trend was only going up. So Kinstlinger made a prediction. This company was on the rise: buy Helios and Matheson, get in on Moviepass.

As part of his prediction, Kinstlinger added a sort of disclaimer: if there was anything to worry about with Moviepass, it's their access capital, their rainy day fund. "We estimate this offering gives MoviePass an estimated seven months of cash to finance over usage by members."

I'm writing this article almost seven months to the day, from when Kinstlinger published his predictions. Helios and Matheson is plummeting on the stock market, down from $14 last week to below $1 per share today. If I open the Moviepass app on my phone right now, it won't work.

Why?

Because they're broke. On July 26th--one week short of Kinstlinger's timeline--the company ran out of money. Citing "technical issues" (read: technically we're broke), the company took down their service and there's no guarantee it'll ever fully come back.

If that's the case, let this article be an elegy to America's most backwards, cost-effective, convoluted, terrible, great company.

fm.cnbc.com

Moviepass, Inc. was founded by a former Netflix executive and president of Redbox, Mitch Lowe--a Tim Allen-looking guy with a "barbecue dad" vibe. Lowe, more than anyone, represents the essence of the Moviepass brand: he's brash, act-first-think-second, smiley and reckless. He has compared his company to "riding a wild bronco", and in that regard he is right on the nose. Lowe began Moviepass in 2011, but it didn't really become Moviepass until the corporate buy-in six years later. Prior to then, it was a niche service geared towards cinephiles, with subscription plans ranging from $15-50 a month.

The product is simple: a subscription service for movie theaters (much in the way Netflix is to on-demand). You can use your Moviepass-issued debit card to see one movie a day, for no additional charge. You can't see the same movie more than once, nor 3-D or special event showings, but other than that, you're free to see 0-31 movies every month at no extra expense to you. Moviepass pays the proper authorities on your behalf.

Whereas the service is quite simple, anyone learning about Moviepass for the first time will find the mathematics of their business model quite head-scratching. As of last summer, Moviepass is just $10 a month (for a short stint around the holidays last winter, it even dropped to $7 a month!), but in major cities, a standard movie ticket can run you upwards of $16. You see the problem, then? When Moviepass was $50 a month, you'd have had to see at least a few movies every month to make your subscription worthwhile. Today, even just one visit to the movies every month and a half will mean you're more than cutting even.

In practice, the numbers get outright ridiculous. For example, personally, in just seven months since I first got a card, I've paid Moviepass $70. I've seen 49 movies in that time span (I can tell, because of a helpful "History" feature in the app). Factoring in the average price of a ticket in my area, Moviepass Inc. has lost just shy of $800 on me alone in this past half-year. Perhaps not everybody sees as many movies as I do. But you can imagine why that wouldn't necessarily make up the difference.

Naturally, this raises the question of how Moviepass makes money. The short answer is: they don't. But they try, in some diverse and strange ways. The most powerful tool in their arsenal is their ability to advertise movies. According to the company's internal data (which you can believe or not, depending on how trustworthy you find Mitch Lowe's face), Moviepass accounts for 3% of domestic box office sales regularly, but up to 10% for movies it advertises. You'd need some Bayesian math to figure out exactly how much that tick up amounts to, but suffice to say, Moviepass--because it reaches so many of America's most enthusiastic moviegoers--has power to influence industry viewing habits.

By dropping their price to $10 a month, however, the company needed new sources of revenue. Being that they were bought out by a data analytics firm, it's safe to assume data harvesting became a big chunk of what Moviepass exists for. A company like Helios and Matheson can take a financial hit from customers if they can turn around and sell those same customers' data, much in the way social media companies are known to do. In March of this year, Lowe formally admitted to the practice; actually, he boasted about it. In a keynote speech titled "Data is the New Oil: How will Moviepass Monetize It?", at the Entertainment Finance Forum in Hollywood, Lowe said this:

"We get an enormous amount of information. Since we mail you the card, we know your home address, of course, we know the makeup of that household, the kids, the age groups, the income. It's all based on where you live. It's not that we ask that. You can extrapolate that. Then because you are being tracked in your GPS by the phone, our patent basically turns on and off our payment system by hooking that card to the device ID on your phone, so we watch how you drive from home to the movies. We watch where you go afterwards, and so we know the movies you watch. We know all about you. We don't sell that data. What we do is we use that data to market film."

The statement reads Orwellian, but what's shocking is less the reality of the model than Lowe's brashness in admitting to it. Plenty of companies freely trade similar data of yours, and just don't like talking about it. For Moviepass, owned by a big data firm, whose primary objective is to advertise movies, it's a powerful tool. It doesn't explain why the app sent me a notification to see "Gotti" a couple weeks back--a movie I wouldn't see if you Clockwork Orange'd me to the front row--but you can imagine the promise of such information, if used correctly. And it's not even exclusive to the movie industry: if Mitch Lowe really does know everything about you, that's worth something to just about anyone anywhere trying to sell you anything.


fromoffshore.files.wordpress.com

So, to sum it up, we have a company losing money every time a customer buys what they're being sold, using everything they can about that customer's life to somehow make up those losses. It's just a circus of business school no-nos. The question, at this point, is who wins in this scenario? Clearly, the customer, unless that data is being used in nefarious ways that offset those individual net gains. The movie industry on the whole wins with Moviepass: studios get paid the same for a regular ticket and a Moviepass ticket, and just as Netflix increases the content people watch at home, Moviepass has encouraged more people to go out to theaters more often than they had beforehand. Small movie theaters win when more people are coming and buying concessions. Big theater companies-- AMC and Regal--lose, because Moviepass far surpasses the benefits of their own rewards programs.

It certainly doesn't seem like Moviepass itself is winning here. The more popular they've become, the more customers they get--markers, in any other organization, of great success--the closer they get to actually shutting their doors and emptying their desks. In the background, Helios and Matheson are on life support. And in a truly Mortal Kombat-level finishing move, AMC, just a few days prior to Moviepass' embarrassing fallout, announced their own subscription plan: 3 movies a week for $19.95 a month.

When Moviepass does officially croak (unless, God willing, some even larger dark money group comes and swoops it up), it will mark the end of one of planet Earth's very few services for which you can make over a thousand dollars worth of ROI per year. It'll be sad but, just like any other good Hollywood thriller, it'll have to come to an end far earlier than we would've hoped. For my money (specifically, $70 of it), this movie was as fun as any Bond iteration, as confusing and off-putting as any DC superhero flick, as wild as any Mission: Impossible.


Nate Nelson is an NYC-based writer and podcast host.


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