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Philo eyes global expansion, hints at possible future price increase

Philo Chief Executive Officer Andrew McCollum
Philo Chief Executive Officer Andrew McCollum is pictured in an undated image. (Photo: Philo/Handout, Graphic: The Desk)

Philo is exploring ways to bring its streaming television service to markets outside of the United States after finding a good deal of success with American cord-cutters, the company’s chief executive said at a presentation on Monday.

Speaking at Fierce Video’s Stream TV Show conference, Philo CEO Andrew McCollum said the company has crossed more than 800,000 subscribers since it launched as a serivce almost three years ago. The company, which was founded in 2009 as a service to distribute live TV signals mainly on college campuses, will celebrate its third anniversary of delivering pay TV channels to cord-cutters on Saturday.

Philo offers more than 60 channels of general entertainment, lifestyle and knowledge channels from various pay TV programmers, including Discovery, ViacomCBS, AMC Networks and A+E Networks. Those four programmers also have financial investments and ownership stakes in the company.

Other programmers, including Altice, Urban One and the E.W. Scripps Company, make some of their pay TV networks available to Philo subscribers through separate, non-ownership agreements.

At launch, Philo offered a handful of channels for $16 a month and an expanded package of channels for $20 a month. Last year, the company eliminated its cheaper package and went all-in on its $20 a month package after finding most subscribers were signing up for it anyway, McCollum told The Desk in an interview this past summer.

On Monday, McCollum said Philo was working very hard to keep its subscription price at $20 a month and had added channels over the last few months that allowed the company to maintain that rate for customers. But he didn’t rule out an eventual price increase in the future.

“I can’t say that the price of Philo will never go up,” McCollum said. “But we definitely put a lot of effort into keeping it as low as we can.”

One thing that could eventually cause Philo to increase its subscription price would be a request by owner-investor ViacomCBS that the service add CBS broadcast and cable networks to its lineup that are currently missing from the service. Philo currently carries ViacomCBS cable channels that existed under the MTV Networks brand, including MTV, VH1 and Comedy Central. Viacom and CBS merged into a single company late last year.

The merger has already affected at least one streaming TV service that found itself choosing between carrying all or none of what ViacomCBS has to offer. Google-owned YouTube TV, which had carried CBS local and cable networks, announced earlier this year it would also begin distributing the MTV Networks under a renewed agreement with the newly-formed ViacomCBS.

In late June, YouTube TV added the MTV Networks channels and raised its subscription price from $50 a month to $65 a month. Subscribers blamed the extra channels for the fee increase, something officials at YouTube TV have not publicly disputed.

McCollum shrugged off the merger during an interview with The Desk, saying it would not have an immediate impact on Philo’s services because the company had a contract that was locked in for at least another year.

“I’m not sure we would necessarily welcome [CBS] with open arms,” McCollum said of any future negotiations. But he added if Philo decided to add the channel, it probably wouldn’t be a huge deal for the company or its subscribers.

“You can look at it in some ways and say YouTube adding the Viacom networks is a much larger change than us adding the CBS,” McCollum said. “If we did add [CBS], I’m not sure it would be terrible.”

McCollum said the company operates around, not through, mergers and acquisitions in the television programming world.

“We don’t really plan our strategy around that kind of change,” McCollum said. “We think, how do we give the greatest value to our subscribers?”

At the conference on Monday, McCollum suggested one part of the company’s long term strategy may be reaching subscribers based outside of the United States. In a write-up on his comments, a Fierce Video reporter said McCollum appeared to indicate that it was “more likely than not that the service will go in that direction.”

Philo might have an easier time breaking into foreign markets than some of its streaming TV competitors: As of now, the service doesn’t offer live feeds of sports, which is typically one of the biggest complicating points when forging international television distribution deals since most domestic broadcasters in other countries have long-term terrestrial and streaming rights to those games.

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About the Author:

Matthew Keys

Matthew Keys is a nationally-recognized, award-winning journalist who has covered the business of media, technology, radio and television for more than 11 years. He is the publisher of The Desk and contributes to Know Techie, Digital Content Next and StreamTV Insider. He previously worked for Thomson Reuters, the Walt Disney Company, McNaughton Newspapers and Tribune Broadcasting.
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