AMC theaters charging for good seats is not like an airline; It's more like a gym membership

Looks like AMC Theaters decided to take a cue from United Airlines, where AMC CEO Adam Aron once served as head of marketing: with the launch of its Sightline program to charge a little extra to book the best seats in the house, the world's largest cinema chain makes money on what users once got for free. What's really happening is a lot more like LA Fitness: creating a revenue stream based on incentivizing users into a subscription they'll use less than they think.

Dynamic pricing is already part of the movies: in the US, it's used for matinees, active military, and people under 12 or over 60. Anyone who's seen "Avatar: The Way of the Water" on IMAX has proven they're willing to spend more to get the best viewing experience. In international markets, premium seats have been the norm for years. And last weekend, major movie chains experimented with offering "80 for Brady" tickets for the price of a matinee all weekend.

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However, Monday's backlash had people calling out AMC for making movies, "of" customers, and saying, "." AMC faced similar outrage around this time a year ago when people discovered that the world's largest movie theater chain had tinkered with a price hike for "The Batman."

Speaking to analysts and experts in the retail and exhibition space industry, it's clear that AMC's Sightline program isn't meant to add value like a premiere ticket class (larger seats, free drinks) or even "premium economy" (leg room, faster access, better chance of overhead storage). Sightline also doesn't let you get a discount on concessions, a plush recliner, or avoid a full-size surcharge: it only raises prices for those who are already > inclined to book seats early for the latest blockbuster.< /p>

What Sightline does is increase the appeal of its AMC Stubs and A-List loyalty programs. You can waive these good seat fees if you're an AMC Stubs A-List member (plus waived online reservation fees, concession upgrades, and rewards points available for $19.95 to $24.95 per month) or unlock the discounted "Value Sightline" for AMC Insider members (it's free). Back in , AMC quickly amassed over 900,000 A-List subscribers and even 50 million people taking advantage of the Stubs free tier benefits.

“There are many clever ways to optimize ticket pricing that not only drive more revenue for theaters, but also drive attendance with lower ticket pricing,” said Alicia Reese, Vice President, Equity Research at Wedbush, at IndieWire. “Adam Aron has long been a proponent of loyalty programs and tiered seating, coming from the airline industry. I agree that AMC is trying to increase its customer loyalty and direct communication with its moviegoers, and the best way to do this is to promote AMC's loyalty program and offer great benefits to its members. Sightline pricing achieves this goal by enticing moviegoers to become Stubs members."

While Film Twitter didn't like it, Wall Street did. AMC shares closed at $6.80 on Monday, up 11.8%, and even AMC preferred stock, or APE shares, rose 5.5% and closed at $3.16. . Reese said the Sightline feature is an added bonus for many AMC investors, many of whom are also members of Stubs, and almost certainly drove AMC stock higher on Monday.

Additional fees, which begin February 10, are an additional $1-$2 per ticket, depending on the theater. If you're at Lincoln Center in New York, it's $2; in some places in Kansas City, it's a dollar. The new pricing tiers will roll out nationwide throughout the year, but will only apply to AMC locations with reserved seating. (Most of AMC's 10,500 screens nationwide don't have it.) How AMC can control Sightlines' policy for those who book a cheaper seat and try to move to a better open seat remains to be seen. see (marked sections? Different signage? colored seats?).

AMC had no comment.