Philo, the budget-friendly live TV streaming service, is introducing a $4 monthly surcharge for subscribers who pay through Apple’s in-app billing system. Starting March 4, 2025, these users will see their subscription cost rise from $28 to $32 per month, challenging Philo’s affordability-driven appeal. Customers who pay directly through Philo or other platforms will remain unaffected—for now.
With a lineup of over 70 channels, including AMC, HGTV, and Comedy Central, Philo has positioned itself as a low-cost alternative to pricier competitors like YouTube TV and Hulu + Live TV. Its $28 base price and unlimited DVR storage have attracted cost-conscious viewers. However, this surcharge could test subscriber loyalty.
Why Philo Is Raising Prices for Apple-Billed Users
At the core of this decision is Apple’s in-app payment policy, which takes a commission—typically 30%—from subscriptions processed through its platform. For Philo, this means Apple claims about $8 from every $28 subscription, making the model unsustainable. Rather than absorb the cost or exit Apple’s ecosystem entirely, Philo has opted for a middle ground: passing part of the expense onto Apple-billed users.
This move aligns with a broader industry trend of streaming services pushing back against app store fees. Netflix and Spotify have already abandoned in-app billing to avoid Apple’s cut. Philo, however, is keeping the option—albeit at a premium—allowing users to decide whether the convenience of Apple’s ecosystem is worth the added cost.
For affected subscribers, the change will take effect with their first billing cycle on or after March 4, 2025. Philo is encouraging them to switch to direct billing to maintain the $28 price and has provided step-by-step instructions to facilitate the transition. Still, some users may stick with Apple’s system for its seamless iOS integration.
The Bigger Picture: A Growing Pushback Against Apple’s Fees
Philo’s surcharge is part of a larger industry battle over revenue control and customer data. App stores like Apple, Google, and Roku act as gatekeepers, taking a cut from every subscription while limiting direct relationships between streaming services and their audiences. Streaming platforms are increasingly resisting these fees.
More Companies Are Cutting Out Apple
Philo is not alone in challenging Apple’s commission structure:
- Disney stopped allowing new subscriptions through Apple’s in-app purchases for Disney+ and Hulu last year.
- Netflix and Spotify removed in-app billing years ago, directing users to their own payment platforms.
- Patreon recently introduced an iOS-specific price increase, giving creators the choice to pass Apple’s fee onto subscribers or absorb it themselves. Like Philo, Patreon is subtly encouraging users to subscribe via its website.
- Substack and other creator-focused platforms have also implemented similar strategies to avoid Apple’s “platform tax.”
The core issue is not just the financial hit but the loss of direct customer relationships. When users subscribe via Apple, companies lose access to payment data, engagement metrics, and retention insights—critical tools for managing churn and optimizing marketing.
Apple’s Position—and Its Growing Vulnerability
Apple’s services revenue has surged in recent years, fueled in part by commissions on in-app transactions. But as more streaming services and creator platforms push users toward direct billing, Apple risks losing its grip on subscription-based apps.
Regulatory pressure is also mounting. In the EU, new laws have forced Apple to adjust its App Store policies, and further scrutiny could lead to broader changes. If major platforms continue steering users away from Apple’s payment system, the company may be forced to rethink its commission structure.
What This Means for Streaming and the Creator Economy
Philo’s move underscores the financial pressures on streaming platforms in an increasingly fragmented market. As subscriber growth slows, companies are looking for ways to cut costs and improve profitability. Passing platform fees onto consumers is one solution, but it risks alienating price-sensitive users.
For creators on platforms like Patreon, Apple’s fee directly impacts earnings, forcing them to either raise prices or absorb the cost. This growing frustration could accelerate the adoption of alternative payment methods and decentralized monetization models.
Meanwhile, bundling strategies—such as the Disney+, Hulu, and ESPN+ package and the Max, Disney+, and Hulu bundle—are designed to keep subscribers within a single ecosystem. These moves not only encourage longer retention but also help companies avoid platform taxes, maintain direct customer relationships, and leverage cross-promotion.
The Take
Philo’s surcharge reflects a growing industry-wide resistance to Apple’s fees. While some subscribers may accept the added cost for convenience, others will switch to direct billing to save money. Patreon and other platforms face a similar dilemma, subtly guiding users toward alternative payment methods to protect revenue.
Long term, streaming services and content creators will continue to find ways to reclaim control over their business—whether through surcharges, bundling, or bypassing app stores altogether. Apple, meanwhile, faces increasing pressure to adapt or risk further alienation from the very services that drive engagement on its devices.
