AMC tries to legally block MoviePass service

AMC, the world's largest movie theater chain, is trying to legally block MoviePass, a service from Netflix co-founder Mitch Lowe, that allows subscribers to see a movie once a day for $9.95 per month, from being used at AMC movie theaters.
3:02 | 08/17/17

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Transcript for AMC tries to legally block MoviePass service
This one has got us talking. Big board, big shake-up for movie theaters. The start-up moviepass is now offering people the chance to see, are you ready for this, a chance to see one movie a day for just $9.95 a month? That sounds like a good deal but the world's largest movie chain AMC theatres is crying foul saying it will hurt the industry long term and ABC's Diane Macedo is here with the details. Good morning. Good morning. So many cities, the cost of a movie ticket just one is more than $10 so as you can imagine customers are pretty happy about this but AMC not so happy about it but they say it's actually the customers that they're looking out for. Imagine being able to watch all the new summer blockbusters you want. For just $10 a month. I have not had this much fun in so long report that's what Mitch Lowe CEO of moviepass is planning to do. Purchase this pass and $9.95 per month will allow to you see one movie a day. Lowe has changed the way we watch TV co-founding Netflix which brought new meaning to the term binge. I'm trying to win over people's hearts. Reporter: But there's one thing in his way, AMC, the nation's largest movie chain. To the war. Technically the war is that way. Reporter: This morning they're threatening a lawsuit against moviepass saying that small monthly fee is not in the best interest of the moviegoer, movie theaters or movie studios. Their goal, to block its customers from being able to use the moviepass. When a new company come as long and says they'll do something a completely different way for a much lower price you'll be threatened. Reporter: Moviepass says it will work the any theater that accepts Mastercard and in an era where the average movie ticket is almost $9 the idea is certainly gaining a lot of fans. No hiding from this. We have a job to do. $9.95 a month for all these movies. Soups too good to be true. Wouldn't they lose a lot of money. In the initial, yes, but the goal is if they can amass a large customer base they can collect viewer patterns and data on the way people watch movies and that can then help sell advertising. Kind of similar to what Facebook does. Moviepass is covering the full cost of the ticket so why is AMC so concerned. AMC says if they -- this is not sustainable they'll eventually have to raise prices so customers will be disappointed. The other thing to consider leverage. If this works and moviepass amasses all these customers the theory is they could go to the theaters and say give us a discount or we'll take these customers elsewhere. No business wants to give that much power to someone else. How has the consumer responded? It's pretty early. It only came out Tuesday but -- The first day they announced they crashed the website. There was so much interest so seems popular. That says things are good. If you just go once, not -- once a month, not even once a week. In most cities you've already made your money. Thanks, Diane. Coming up, "Deals & steals,"

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