MoviePass’ old stale song and dance

In the beginning, MoviePass’ popularity rose quickly due to its unlimited $9.99/month plan that allowed users to watch a movie a day. Sometime in the 2018 summer, the company stopped the plan since it was bleeding cash and on the verge of bankruptcy. Of course, when you buy goods at retail prices and sell them to your customers at wholesale prices, you are doomed to empty your own bank account.

Fast forward to now, after several changes in its plans, MoviePass announced the comeback of its unlimited plan, with some changes.

Source: MoviePass

The plan is $5 more expensive than its previous version. If subscribed to an annual plan, users can get the plan at $9.95. However, the thing that caught my attention is the text below the “Get Started” button. It reads: “*Your movie choices may be restricted due to excessive individual usage which negatively impacts system-wide capacity. See Terms of Use section 2.5 for further details”.

Curious, I went to the Terms of Use section and found out a couple of other points that should be called out

2.4. MoviePass reserves the right to change or modify the Service or subscriptions at any time and in its sole discretion, including but not limited to applicable prices, without prior notice. MoviePass reserves the right to change the rules of movie-going attendance and ticket availability to subscribers in connection with the Service at any time. 

2.5. MoviePass makes no guarantee on the availability to any particular theater, showtime, or title that is presented in our app. MoviePass ticket inventory may vary from specific theater ticket inventory. MoviePass reserves the right to adjust its inventory to maintain fair access and usage to its full customer base. MoviePass may utilize its proprietary data and algorithms to impose restrictions on individual users based on their location, day of movie, time of movie, title, and the individual user’s historical usage. This means that MoviePass has the right to limit the selection of movies and/or the times of available movies should your individual use adversely impact MoviePass’s system-wide capacity or the availability of the Service for other subscribers.

2.6 You agree to choose the movie title, theater, and showtime up to no more than three (3) hours prior to the selected showtime, through the MoviePass App.

Source: MoviePass Terms of Service

To be fair, writing an encompassing Terms and Conditions text is a standard in the service business. I wouldn’t be surprised if MoviePass had the same terms one year ago. But how could one person “negatively impacts system-wide capacity”? MoviePass has this clause in place to leave some room to wriggle itself out of blockbuster movies that attract moviegoers and inflict losses. Furthermore, it is different now than it was a year ago.

I personally used the original unlimited plan in the last month before it was terminated. I could book any showtimes at any hour that I liked. There was no restriction on the selection of movies. Nonetheless, MoviePass started to remove the unlimited part of the plan and added restrictions on showtimes and movie selection. It’s very likely that they would do it again this time. Plus, users can only book movies 3 hours before the showtime. It’s very limiting and didn’t exist one year ago.

If you call a plan uncapped, yet have some unpleasant surprised in store for users, odds are that users will be greatly disappointed. Disappointed users are not what you want in the subscription business, especially given that the business model is inherently flawed in the first place and that there is great competition in AMC or other streaming services. There seems to be ample ingredients for another failure by MoviePass.

What could go wrong this time?

China, High Tech, Convenience and Privacy Concern

I was poring through the Youtube channel of Bloomberg, which features quite a few informative videos and this one was particularly interesting to me:

The video talks about a world of tech alternatives to what we are all familiar with: Facebook, Amazon, Youtube… Name one famous tech household name and there is a Chinese counterpart. Also, it shows a little bit of how QR codes and by extension, mobile payments are popular in the country. However, what is most interesting to me is the extent to which surveillance takes place in the world. In the video, a Western guy told a story of how his WeChat account’s money got deducted 20 seconds after he jaywalked in Shenzhen. That’s disturbingly fast. Plus, the government knows everything you do and ranks you based on your social behavior.

I have been of an opinion that an authoritarian leadership in China is a significant factor in its fast ascendency economically and politically in the world stage. Decisions are quickly made and there is singular focus as well as continuity due to the fact that there is one ruling party and for the foreseeable future, one ruler (aka Xi Jinping). On the other hand, decisions and policies take ages in the US and the pattern is, as I observe, that one president will undo all the work of the his predecessor, if the predecessor comes from the opposing party. The same may also be said to the ruling party in Congress.

On the other hand, it can be argued that privacy violations in the Western world are nowhere near as severe as they are in China. The NSA may have the same capabilities as the Chinese government in terms of surveillance, but we haven’t, thankfully, seen it do what the Chinese government is doing. Plus, the society we are living in allows us to practice freedom of speech more than the one in China. In the US, you can make fun of anyone in the government and Congress, though I don’t think you should do so in China.

If you think about it, we have speed of decision-making process due to one ruling party vs the lack of freedom, or convenience vs human right violations at the extremes. You can have one extreme at the expense of the other, but you can’t have both. It’s like the dilemma: does the means or the end matter more?

What works for this country will not likely work for another. I don’t know which one is inherently superior. I think it is just down to personal preference and perspective. Personally, I value freedom more.

Weekly Readings – 16th March 2019

How the epic ‘Lord of the Rings’ deal explains Amazon’s slow-burning media strategy. Interesting insights into angles Amazon may be pursuing in their media strategy. I am curious to know the activities to which Amazon prefers users watching videos.

How Equifax neglected cybersecurity and suffered a devastating data breach. I encourage you to read or at least skim it. The data breach affected more than 140 million accounts. So, there is a high chance that you are one of the affected. As one of the three main Consumer Reporting Agencies, Equifax is important in our lives, yet it displayed a shocking lack of care about our sensitive data. According to the report, Equifax didn’t have proper documentation or policy in place. It had 8,000 vulnerabilities that were past the due dates for patching. It didn’t even track the expiration date of SSL certificates, something that is definitely not rocket-science. Upton notice of an Apache vulnerability, Equifax failed to respond in a timely manner. The other two CRAs did and as a result, avoided a similar fate.

Writing is thinking. I don’t think I need to elaborate more on this. I love writing and it’s one of the reasons why I have this blog.

The Clear Case for Capitalism. I am a fan of true capitalism. With emphasis on the word “true”. There I said it. The article lays out the benefits that we can gain and have gained from capitalism. I urge you to read the article before listening to politicians or anyone talk about capitalism.

Lyft IPO: Cautiously Optimistic Unit Economics Despite Significant Losses. I have a pessimistic view on the outlook of Lyft after reading their S-1. However, this is an interesting and positive take on the ride-sharing company’s unit economics.

Where Warren’s Wrong. A 4,900-word masterpiece by Ben on Senator Warren’s proposal to break up big techs.

Microsoft, Facebook, trust and privacy. I find it great for us to have folks like Ben Evans, who has a lot of years of experience in tech and business. His experience, reflection, connecting the past and the present, the writing and multi-dimensional view are always helpful and informative. I agree with him that even though the new change in vision may render it irrelevant the strategic issues Facebook is facing, the new vision asks as many questions as it answers.

Formula 1: The secret aerodynamicist reveals design concepts. Formula 1 isn’t a popular sport in America even though the country features one of the best tracks in the world and has one world champion back in 1980. Formula 1, as people usually say, is the pinnacle of motorsports. It has arguably the fastest cars, at least in corners, and the most advanced technologies. The post will reveal great information on the aerodynamics of the cars.

Don’t Read This If You’re Bullish About Lyft. The title is quite self-explanatory.

Vietnamese movie: Wayless by Imaginary Friends

I came across this short movie by a group of Vietnamese folks. It’s great that the film won the Best Director category at 48 Hour Film Festival and will be screened at Cannes.

Have a watch and don’t worry as there is English subtitle. Below is the trailer:

3 questions/concerns I have:

  • What happened to the dog?
  • Don’t shoot people in front of kids!!!
  • Why keeping the body in the trunk?

Joking aside, I am happy for the team and glad that there will be some exposure to the international audience for Vietnamese films.

Criminal Justice Reform as The Main Issue for a Presidential run

I was very disturbed by the sentence imposed on Paul Manafort. 7 years in total for all the crimes he committed, even though the guidelines indicate that the sentence could be lengthened for another 10 years. I am not implying anything beyond the sentence for Manafort. Regardless of your political view, just put that aside and think about what he did to enrich himself at the expense of the country and what the law stands for. Would you still think the sentence was justified? Especially when there is no lack of cases when folks got longer sentences for “crimes” far less?

Or this case: https://www.cnn.com/2018/03/30/us/detroit-man-wrongfully-excused-of-murder-released-trnd/index.html. You probably will find more examples on the failures of America’s criminal justice systems, but you should get my point. There are so many, especially the poor and the under-privileged, that have to suffer from the inadequacy of the criminal justice system.

I strongly believe that we only live once. The limited years we have on this year are so precious that reading about folks spending years behind bars for trivial crimes or even crimes they didn’t commit really bugs me.

I am not a policy person or a politician. I don’t have an answer or a policy outlined in details, but to be frank, it’s not my job. The folks in Washington DC have the experience and an army of aides with relevant knowledge and experience to do the job. I would love to see criminal justice reforms as the central issue for the 2020 race. I hope that next year, a candidate, regardless of political parties, will run on this issue and one day no one will have to waste their lives unjustly. I hope that a candidate will actually put the interests of the whole country above all else. Even if the person doesn’t succeed, running on criminal justice reforms will bring so much more attention and conversation to the issue and who knows what that would be able to do later on?

I have written about my fondness of the show Madam Secretary before, but in this clip, the Secretary decided against the appeal of popular like jobs and her advisor’s recommendation so that she would run on criminal justice reforms. Let’s make it true America. Please.

Exceptionalism vs Humanity/Common Sense

America is perhaps the poster boy country for exceptionalism. After 2.5 years here, I have come to realization that exceptionalism is revered around here and by-product of the optimism and entrepreneurship that have become the hallmarks of the American dream. Unfortunately, exceptionalism is pursued and achieved in some cases at the expense of humanity/common sense.

Take the article on Elon Musk and Tesla today on Bloomberg as an example. The article revealed the length Elon and Tesla went to to ruin the life of a whistleblower. I highly recommend you to read the article. Below are the pieces that disturbed me:

The leaker, they determined, was one Martin Tripp, a slight man of 40 who’d spent his career in a series of low-level manufacturing jobs before finding his way to the assembly line at the Gigafactory. Tripp later claimed to be an idealist trying to get Tesla to tighten its operations; Musk saw him as a dangerous foe who engaged in “extensive and damaging sabotage,” as he wrote in a staff memo. He implied that Tripp had shared the data not only with the press but also with “unknown third parties.”

On June 20, the company sued Tripp for $167 million. Later that day, Tripp heard from the sheriff’s department in Storey County, Nev. Tesla’s security department had passed a tip to police. An anonymous caller had contacted the company to say Tripp was planning a mass shooting at the Gigafactory.


When the police confronted Tripp that evening, he was unarmed and in tears. He said he was terrified of Musk and suggested the billionaire might have called in the tip himself. A sheriff’s deputy attempted to cheer up Tripp and then called Tesla to tell the company that the threat, whoever had made it, was bogus. Tripp wasn’t dangerous.

Musk’s treatment of Tripp threatens to complicate this legal and regulatory mess. The security manager at the Gigafactory, an ex-military guy with a high-and-tight haircut named Sean Gouthro, has filed a whistleblower report with the SEC. Gouthro says Tesla’s security operation behaved unethically in its zeal to nail the leaker. Investigators, he claims, hacked into Tripp’s phone, had him followed, and misled police about the surveillance. Gouthro says that Tripp didn’t sabotage Tesla or hack anything and that Musk knew this and sought to damage his reputation by spreading misinformation.

The following day, news of the lawsuit hit the internet. Tripp Googled himself and saw a story titled, “Martin Tripp: 5 Fast Facts You Need to Know,” which said he lived in a rental apartment in nearby Sparks, Nev. Panicked about who might come find him, he sent an email to Musk. “You have what’s coming to you for the lies you have told to the public and investors,” he wrote.

His former boss, of course, engaged him with gusto. “Threatening me only makes it worse for you,” Musk replied. Later, he wrote: “You should be ashamed of yourself for framing other people. You’re a horrible human being.”

“I NEVER ‘framed’ anyone else or even insinuated anyone else as being involved in my production of documents of your MILLIONS OF DOLLARS OF WASTE, Safety concerns, lying to investors/the WORLD,” Tripp responded. “Putting cars on the road with safety issues is being a horrible human being!”

No one can question Elon’s greatness. I myself read a book on him and had a lot of respect for the guy, but what was described above was really difficult to read. No matter how great you are, that’s not how you should treat a person who has nowhere near the power or resources you have.

I read the Bad Blood book, which chronicled the scam of Theranos. It’s mind-blowing to read about how such a deceptive scheme transpired, how many people got hurt along the way as a select few individuals sought exceptionalism and how such individuals, like Musk, went out of the ways to ruin the lives of others who stood up to them.

There is also no lack of documented materials on how millions of dollars in savings vaporized through the Internet bubble and the 2008 economic crisis because exceptionalism was pursued in spite of common sense.

I am pretty sure I am and will be nobody in this world. But at the end of my days, I will still be proud of myself for not screwing anybody over to get what I want. To me, compassion, common sense and humanity matter more than exceptionalism.

Apple’s abuse of power

When I jogged down my thought on Senator Warren’s plan to break up Apple, I was wrong when I put:

 I also fail to recall an instance where Apple released a certain product/service and abused its power to favor the product/service.

I failed indeed as it turned out, Apple has, to Spotify.

Spotify has filed an antitrust complaint against Apple, citing its abuse of power to favor its Apple Music. It also launched a website to detail the abusive power of the iPhone maker.

I am still of opinion that there are expenses involved in running AppStore such as security patches, payment, language translation, fraud prevention, and so on. These expenses can be considered justification of the 30% revenue tax imposed by Apple, though it’s not unreasonable to say that it’s a bit too high. Nonetheless, it creates unfair advantages for Apple when the tax is imposed on apps that compete with Apple’s own such as Apple Music as in the case of Spotify. Worse, Apple threw restrictions at Spotify in order to reduce competition for Apple Music as detailed in the website above.

I am genuinely disappointed in myself for the inaccurate statement I made. I still think Senator Warren’s call to break up Apple from AppStore is impractical and over-reaching. However, they do need to answer for the abusive behavior like they have shown to Spotify and should take actions in similar cases moving forward to ensure a fair competition to apps makers.

Lesson learned for me.

Concern over Facebook’s new privacy-focused vision

A few days ago, Mark Zuckerberg shared with the world his privacy-focused vision for Facebook moving forward. I understand that it may make sense strategically for the company, but I have real concerns over the feasibility of the strategy.

Lack of trust

Facebook has been littered with scandals for the past two years. The trust between the blue brand and users isn’t particularly at its all-time high. There have been documented evidence on the exodus of users from Facebook or the significant decrease in activities. If the trust is already shaky, why would users trust Facebook with every aspect of their life by using their proposed super app? (The super app concept is similar to WeChat, which users can use to do many things while on the platform such as booking movie tickets, paying bills, transferring money to friends and families…). If we can’t trust Facebook with just daily communication, how can we entrust it with more aspects of our life? If you can’t trust a dentist to treat your teeth, would you trust that dentist if he said he could fix your eyes?

The audience

I think one of the reasons why WeChat is successful is because of the target audience. Coming from that part of the world, I can say from personal experience that we Asians tend to not care as much as Western audience about privacy. I think there is a reason why WeChat hasn’t been as successful overseas as it is in China. If it were marketed to Western audience, given its relationship with the Chinese government and Western users’ concern over privacy, I don’t think it would be a triumphant effort. Hence, to convince Western users to use Facebook for everything, the trust has to be pretty solid. It’s not there now for sure.

Regulatory hurdles

Facebook has attracted unwelcome attention from lawmakers recently. And for a good reason. Even if they had done nothing wrong, which is definitely not the case, I suspect that the road to the super app vision wouldn’t be without robust challenges from the regulatory perspective.

Essentially, it’s all well and good for Facebook to change its stance on privacy. However, the trust isn’t there. I would love to see more concrete actions to transition from a company whose more than 95% of its revenue is from ads to a company that values privacy first. I am not a believer at the moment since Facebook has used up the rope we gave them already. If they want us to trust them again, they have to do it the hard way. And I think they have to hurry as well as the world won’t stand still for them. If this is the vision that makes business sense, others will go for it as well.

If they are committed and succeed in the future, kudos to them. Until then, I choose to remain skeptical of the vision.

Elizabeth Warren’s call to break up Apple

I wrote yesterday on Elizabeth Warren’s plan to break up yesterday. I thought that was that, but apparently she followed up with a call to break up Apple as she laid out in an interview with The Verge.

You were very specific in how you’d break up Google and the rest. How would you break up Apple?

Apple, you’ve got to break it apart from their App Store. It’s got to be one or the other. Either they run the platform or they play in the store. They don’t get to do both at the same time. So it’s the same notion.

Pulling that apart, the App Store is the method by which Apple keeps the iPhone secure. It’s integrated into the platform. How would you propose that Apple and Google distribute apps if they don’t run the store?

Well, are they in competition with others who are developing the products? That’s the problem all the way through this, and it’s it’s what you have to keep looking for.

If you run a platform where others come to sell, then you don’t get to sell your own items on the platform because you have two comparative advantages. One, you’ve sucked up information about every buyer and every seller before you’ve made a decision about what you’re going to to sell. And second, you have the capacity — because you run the platform — to prefer your product over anyone else’s product. It gives an enormous comparative advantage to the platform.

Users love Apple products because of the combination of hardware and their exclusive software. What good is a phone without functioning and useful apps? Apple distributes apps on their devices through App Store and that’s why I don’t understand what she meant by “breaking it apart from App Store”. From a consumer standpoint, Apple leads all manufacturers in terms of customer satisfaction. If any of her plans were about protecting consumer interests, this one didn’t seem to fit the bill.

Source: American Customer Satisfaction Index

Here is what Tim Cook reported in the latest earning call:

The latest survey of U.S. consumers from 451 Research indicates customer satisfaction of 99% for iPhone XR, XS and XS Max combined. And among business buyers who plan to purchase smartphones in the March quarter 81% plan to purchase iPhones. Based on the latest information from Kantar, iPhone experienced a 90% customer loyalty rating for iPhone customers in the U.S. 23 points above the next highest brand measured.

The most recent consumer survey from 451 Research measured a 94% customer satisfaction rating for iPad overall, with iPad Pro models scoring as high as 100%.
Among business customers who plan to purchase tablets in the March quarter, 68% plan to purchase iPads. 

Source: Seeking Alpha

From a developer perspective, I wrote about how much Apple paid out to developers over years:

As of June 2017, developers earned $70 billion from App store since its launch in 2008. As of January 2019, the figure went up to $120 billion. Moreover, we are about to see their investment in original content as their streaming service is reportedly going to be live this April.

I can understand why folks complain about the hefty 30% Apple tax on App Store, but thanks to Apple and AppStore, developers and businesses have generated a tremendous amount of revenue, to the tune of $120 billion over the years. Techcrunch reported a comparison between Google Play and AppStore about 5 months ago

According to SensorTower, an average iPhone user spent more on apps in 2018 than they did in 2017.

iPhone Per Active Device Average Revenue U.S. 2015 to 2018
Source: SensorTower

If Apple and AppStore are making consumers happy and bringing developers/app makers money, what exactly is the reason for breaking Apple apart from the AppStore, undermining the control over the ecosystem?

Also, there is a difference between making money off user data and making money off products/services improved by the use of data analysis. If you can mine data to improve services and products, you must be a fool not to. Website administrators use Google Analytics to improve website performance. Netflix uses data to see what shows you may be interested in. Google uses your data to improve the search algorithm to make it more relevant and fast. What is wrong with all of that? I also fail to recall an instance where Apple released a certain product/service and abused its power to favor the product/service.

In short, the interview with The Verge made me even more disappointed in her after yesterday, something I didn’t imagine would happen so fast. A friend of mine mentioned that she represented the left. I don’t think this has anything to do with the political ideologies. Understanding how these technology companies work has nothing to do with one’s political view. It’s concerning to have a Presidential candidate with that ill-informed hostility to the growth engine of the US economy.

Weekly readings – 9th March 2019

Shared scooters don’t last long – a bear case for shared e-scooters. I rode Lime once in Austin. Coming from a country where the primary transportation means is scooters, I see it first-hand what a similar experience is like. Don’t get me wrong. The technology is impressive, but I wasn’t that excited. There is a lot to figure, not only from the economic perspective, but also from the logistics side. People throw scooters left and right on pavements. When the number of scooters explodes, what would happen then? On top of that, there have been quite a number of documented accidents so far from scooters. Finally, I am a fan of public transportation. I’d love to see America invest more in public transit than in shared scooters.

Civil rights under Trump – Patriot Act with Hasan Minhaj. Important information on what is going on in the US and the Census going into 2020.

Warren Buffett’s FAQ. An impressive collection of WB’s perspectives in different areas

HQ2: Understanding What Happened & Why. I don’t really care that much about the whole situation because 1) different stakeholders (Amazon, citizens in the neighborhood, politicians who want to create jobs, politicians who dislike the potential impact on the neighborhood) have different interests. 2) Nobody could guarantee the outcome if the deal went through. Nonetheless, it’s a very good and informative piece, most of which I tend to agree with.

Its Not Capitalism, its Crony Capitalism. An interesting perspective that is elegantly explained. To me, greed is good, but too much greed is terrible. What people hate and talk about on the news is too much greed. Who wouldn’t want to make money out of their innovation or effort? On the other hand, if education and healthcare are too expensive to afford as they are in the US, why would it be a draconian thing to give some support to the citizens? Social benefits DONT equal to socialism. You also need a nationalization of the economy which the US doesn’t have.

How to Shoot on iPhone series. I am a big fan of short, simple and educational marketing videos. Love this series from Apple. If they can continue to release videos like these to help unlock the functionalities and usage of the hardware, chances are that users would love them even more.

This is actually a double. BestBuy and Target transformation. Retail is interesting as a space to watch. I don’t believe in the apocalypse of bricks-and-mortar stores as many predict. In fact, Target, as mentioned in the article, increased its footprint. I documented some retailers which increased footprint here as well. It’s a matter of responding to the changes in the business environment. If a retailer refuses to embrace technology or to change, the doom is imminent. But if you have a game plan to leverage technology to keep your competitive advantages, it’s not a “it’s Amazon’s to lose” situation. At least not yet.