Wallet-friendly virtual MVPD Philo has expanded its lineup of skinny pay TV plans – on Tuesday adding a lower-cost Essential tier to the mix as it seeks to cater to preferences and habits of different subscriber segments.
That means starting March 10 there are two paid Philo plans for consumers to choose from. The newest being Essential, which costs $25 per month for 70+ cable TV channels, more than 120 free streaming (or FAST) channels, 80,000 movies and shows on-demand, unlimited DVR with one-year storage and a newly reinstated 7-day free trial.
The other option is Bundle+ (which was previously the only plan option and known as the Philo Core package) that costs $33 per month for everything within the Essential package plus AMC+ and access to ad-supported versions of the HBO Max and discovery+ apps bundled in. The Bundle+ plan does not include a free trial.
Philo, which had 1.3 million paid users as of 2024, has long prided itself on offering a low-cost entertainment-focused skinny pay TV lineup and last fall made the move to bundle in SVODs with HBO Max (which followed earlier additions of AMC+ content and also coincided with price increases for its Core package).
Now it wants to make sure it’s still appealing to those more price-conscious consumers that have appetite for the original low-cost skinny TV entertainment proposition with the intro of the Essential tier.
“The move reflects a commitment to our audience, many of whom have been with Philo since the beginning, that Philo prioritizes delivering a thoughtfully curated package of top notch content at affordable prices, and meeting consumers where they are,” said newly minted Philo CEO Mike Keyserling in a Q&A with StreamTV Insider. “Today we’re explicitly carving out the Essential offering to cater to customers, both new and returning, who primarily value affordability and linear networks.”
In addition to paid plans Philo has a completely ad-supported free streaming tier.
Keyserling told STV Insider that since adding SVOD services to its lineup, Philo has “seen two segments emerge in our subscriber base,” where the new plans stand to appeal to both those who want broader entertainment experiences with Bundle+ as well as those who still want a lower-cost simplified TV plan with Essential.
“We are attracting a distinct audience that is motivated by the expanded bundle with premium streaming services integrated alongside live TV in a single subscription. We’re also seeing strong demand for the simpler, lower-cost live TV package that reflects our original vMVPD model,” Keyserling commented, noting that ultimately is what led to formalizing the two plans released today.
“By keeping everything within one unified platform, customers can move between those options as their preferences change,” he said.
SVOD bundling drives incremental audience, improved retention
Before getting more into the segments Philo’s targeting with expanded plan options, it’s worth noting that the vMVPD is seeing positive impacts from bundling SVODs like HBO Max into its offering – where introducing another tier is more about allowing for flexibility and choice, rather than giving consumers just one option. And it expects subscribers to move between the two plans.
“What’s been interesting is that bundling has broadened our addressable market by adding an incremental audience that we may not have had an opportunity to tap into before,” Keyserling said. “We expect to see more movement between the two options as we more seamlessly integrate discovery for the SVOD streaming content in our UI and now that they are both available as part of the sign up experience.”
On the content integration front, currently only content from AMC+ is ingested directly within the Philo app (meaning users don’t need to leave or switch apps to access the content) for its Bundle+ plan. Ad-supported versions of HBO Max and discovery+ are available through their standalone apps at no extra cost.
However, Keyserling did affirm that in the coming months, Philo is “bringing discovery of that content directly into the Philo interface, which aligns with our broader goal of delivering a more unified platform experience.”
As for impacts from SVOD bundling, it appears to be helping the streaming challenge of churn – as the chief executive said from a growth perspective, “the biggest sustained impact we’re seeing thus far is on improved retention.”
Legacy offering still sees strong loyalty
And while incorporating access to SVODs and offering a broader content lineup has benefits, Philo still sees appetite for its original low-cost skinny TV bundle proposition.
Per Keyserling, what Philo is hearing from users “is that flexibility matters.” Meaning not everyone wants to pay more for a package that includes access to streaming services.
Part of the driver and underpinning Philo’s confidence in launching the Essentials plan, according to the CEO, is the “strong loyalty” existing and returning subscribers have to the company’s legacy offering.
“Even as the streaming ecosystem expands with premium services, there remains a large group of viewers who primarily want an inexpensive way to access live entertainment channels. The price-conscious slimmed down offering is one of the differentiating characteristics of Philo that we want to continue to nurture,” he explained. “For many households, Philo remains one of the most affordable ways to access the live TV channels they care about, and one where they don’t have to sacrifice quality.”
Audience distinctions emerge
Related to nurturing that cohort, Keyserling affirmed that based on experience with the Philo legacy package, the company sees distinctions emerging between audiences who gravitate towards each plan – and those are aligned with how Philo decided to structure the dual paid offerings.
Perhaps unsurprisingly, the Essential plan attracts viewers “who are primarily focused on live TV and price,” with the chief executive noting many of those customers come from cable or other vMVPD services “and are looking for a simpler, lower-cost option without additional streaming apps bundled in.”
The Bundle+ (formerly Philo Core), meanwhile, is hitting the mark more with consumers who want a broader entertainment experience but still care about value.
“Those customers are drawn to the combination of live channels alongside premium services like HBO Max, discovery+, and AMC+,” he said, noting that with the plan subscribers get a significantly deeper library of content for $8 more per month. “There’s generally less price sensitivity with this audience and more opportunity to explore what an ideal bundle, across services could look like.”
With two paid plan options, Philo can serve both of these segments without forcing consumers into just one.
“The intent is that over time, we facilitate seamless transitions between these packages and our free offering depending on what is relevant at the time,” Keyserling commented, adding that the seasonal nature for TV shows and relevant behavioral data indicates that no single package is likely to be the ideal value 100% of the time for a given subscriber. “Our job is to support that truth by providing options that can flex in response.”
Free streaming tier helps engage churners
Philo, like other vMVPDs such as Fubo, also has a free streaming tier to engage potential and former subscribers.
On the free tier front, some of Philo’s latest FAST channel additions include CBS News 24/7, 48 Hours, the Martha Stewart Channel and Emeril Lagasse Channel, which joined the lineup February.
Per Keyserling, Philo’s free tier “has continued to grow meaningfully compared to where it was a year ago.”
The company sees the FAST offering serve two important roles, including as a standalone offering for viewers that want a free streaming experience, as well as a home base to keep former subscribers engaged with Philo even when shows are off-season and potentially return to paid plans.
“It helps maintain a relationship with those customers and keep them connected to the platform, and we often see them return to a paid plan after spending time engaging with the free service,” he said.
From a business perspective Philo’s free tier is also “generating meaningful advertising revenue” Keyserling commented. And although a different model than the paid service, said it remains an “important and valuable part of how we think about growing the overall Philo ecosystem.”