Philo has nabbed more dough: The low-cost live-streaming TV “skinny bundle” provider has raised $40 million in Series C funding, led by existing investors AMC Networks, Discovery and Viacom.
The funding brings Philo to more than $90 million raised to date. Additional investors include A+E Networks, CBC New Media, NEA, Rho Ventures and Xfund.
The company mainly plans to use the cash infusion for marketing, said Philo CEO Andrew McCollum. The over-the-top cable TV package is pitched to “cover-nevers” — people who have never subscribed to pay TV — or cord-cutters, who have cancelled cable or satellite service.
“One comment I get is, people say they love Philo but they’re surprised they don’t see it come out more in advertising,” he said. “That will change with this funding.” The company is looking at doing more digital video, podcast and radio advertising, but won’t likely run TV advertising just yet, according to McCollum.
Philo’s service costs $16 monthly for 40 entertainment and lifestyle channels, and $20 for 49 channels. The company keeps its pricing low by omitting sports channels (like ESPN) and broadcast TV. “We’ve been less focused on cannibalizing existing cable TV subscribers than signing up people who aren’t watching TV through any existing service because they just haven’t been well-served by the options out there,” McCollum said.
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In addition, Philo is announcing the launch of its service on Apple TV and Amazon Fire TV devices. The service launched last fall, available on Roku devices, computer browsers, iOS devices, and Android devices via Chrome (with a native Android app in the works). Philo also provides subscribers access to programming through 35-plus TV Everywhere apps of participating cable networks.
“Roku has the largest market share in the connected-TV market space, but Apple TV and Fire TV are significant portion of the market. This definitely broadens the base,” McCollum said.
The company also will use the latest round of funding to invest in building new product features. For example, Philo is developing new social-TV experiences for subscribers to interact with friends on the service.
McCollum declined to disclose how many subscribers Philo has at this point but said it’s growth is “tracking basically with our plan.” The service competes with a range of internet pay-TV rivals, including YouTube TV, Sling TV, DirecTV Now, Hulu With Live TV, PlayStation Vue and FuboTV. However, given the lower price point, McCollum said, Philo is likely attracting more new consumers to the pay-TV ecosystem (as opposed to simply winning subscribers who switch from traditional providers).
Based in San Francisco, Philo has about 40 full-time employees. McCollum said the company is always trying to hire engineering talent, which is especially competitive market in the Bay Area.
Founded in 2009, Philo previously was geared around delivering broadband TV over college campuses, before shifting to reach a general consumer market with the backing of A+E, AMC, Discovery and Viacom. It continues to maintain that line of business, and McCollum said he expects it to become a bigger subscriber-acquisition tool for the general-market product.
The company’s skinny TV bundles are available only in the U.S. Both the $16 and $20 monthly packages include A&E, AMC, BBC America, Comedy Central, Discovery Channel, Food Network, HGTV, Lifetime, MTV, TLC, Travel Channel, VH1 and Viceland.
Philo’s TV service provides the ability to watch on up to three different devices at the same time; an unlimited network-based DVR that stores programs for 30 days; access to video-on-demand titles; and the ability watch programs that have aired in the past three days.
