Tis the season for rate increases. Fa-la-la-la-la, La-La-La-La.

Comcast is bringing itself some Christmas cheer this holiday season with more of your money going into its pocket as the cable giant announces nationwide rate hikes that will cost customers an average of 3.8 percent more in 2017. Comcast blames much of the increase on others.

“We continue to make investments in our network and technology to give customers more for their money—like faster internet service and more Wi-Fi hotspots, more video across viewing screens, better technology like X1 and a better customer experience,” Comcast said in a statement. “Unfortunately, the costs we are charged to carry popular networks continue to increase significantly, especially broadcast television and sports programming, which are the largest drivers of increases in price adjustments.”

Customers may not feel like they are getting more for their money with Comcast’s data caps and overlimit fees, which increasingly affect customers except in the northeast (for now). Cable TV customers will generally see a published rate increase of around $1 a month, which sounds like a pittance until you scrutinize the rate hike more closely.

Bill padding is where the real money will be made in 2017:

• Broadcast TV Fee: Was around $5 in most markets, but Comcast intends to charge $2 more, bringing the fee to $7 a month;
• Regional Sports Surcharge: Whether you watch sports channels or not, you will be expected to pay $2 more next year for those channels, with fees rising to $5 a month.

The absence of viable broadband competition in states like Maryland, bypassed by Verizon FiOS, means Comcast can raise broadband prices almost at will.

TV Predictions notes officials in Montgomery County, which includes the suburban Washington, D.C. cities of Bethesda and Rockville, have been notified of $5 a month rate hikes on broadband, taking some internet access pricing above $80 a month:

• Internet Plus will increase from $77.95 a month to $82.95 a month;
• Internet Pro Plus with Showtime will rise from $81.95 a month to $86.95 a month;
• Internet Pro Plus With HBO will increase from $84.95 a month to $89.95 a month;
• Premier XF Double Play package will increase from $182.95 a month to $187.99 a month, taking Comcast closer to the $200 cable bill.

Standalone internet pricing is now just as expensive as a deluxe cable television package, despite the fact it costs Comcast only a fraction of the amount it charges to provide the service:

• Performance plan will rise from $69.95 to $74.95 a month;
• Performance Pro plan will go from $79.95 a month to $84.95 a month;
• Blast plan will rise from $82.95 a month to $87.95 a month.

An activist group of shareholders led by a hedge fund has successfully pressured executives at FairPoint Communications to sell the company to maximize shareholder value.

The buyer, Illinois-based Consolidated Communications Holdings, Inc., said on Monday it would acquire FairPoint in an all-stock deal worth $1.5 billion, debt included.

The buyout will enrich certain shareholders and hedge funds, including Maglan Capital’s David Tawil and Steven Azarbad, who blasted FairPoint CEO Paul Sunu in a letter sent earlier this summer complaining “shareholders have been extremely patient with the company’s operational turnaround and have suffered because the board has not been vigilant in protecting shareholder value.”

Maglan will cash out its investment initially made after FairPoint went bankrupt, when the share price was below $4. As of 4pm this afternoon, FairPoint stock was trading at $18.85 a share, less than the $23 a share and 75% premium Tawil and Azarbad were hoping for back in August. But they will still walk away earners, selling at around $18 a share plus an additional 17.3% premium. Collectively, the two hedge fund managers control 7.6% of FairPoint’s shares.

Consolidated Communications will inherit residential FairPoint phone and broadband customers in 17 states, most notably those in Maine, New Hampshire, and Vermont. But press releases from Consolidated showed little interest in the residential telecommunications business. Instead, Consolidated executives are looking at FairPoint’s business and enterprise customers, and the benefits of owning FairPoint’s 17,000 fiber route mile network.

Critics suggest the deal effectively enriches shareholders while putting FairPoint’s existing debt and buyout on the new owner’s credit card. Consolidated will inherit $887 million of FairPoint’s current debt plus the $1.5 billion cost of the acquisition.

The combined company will keep the Consolidated Communications name and FairPoint Communications as a brand will eventually disappear if regulators approve the transaction sometime in 2017.

Consolidated Communications currently serves residential phone customers in:

• Suburban/Exurban Sacramento, Calif.
• Fargo, N.D.
• Mankato, Minn.
• West Des Moines, Ia.
• Suburban Kansas City, Kan.
• Mattoon, Ill.
• Lufkin, Conroe, and Katy, Tex.
• Suburban Pittsburgh, Pa.

FairPoint customers and state regulators in New England expressed concern about the transaction. After FairPoint acquired landlines formerly owned by Verizon Communications a decade ago, the transition was described as “disastrous” by regulators, who received scores of complaints about service and billing problems before FairPoint ultimately declared Chapter 11 bankruptcy, mired in debt.

After emerging from bankruptcy, FairPoint has endured union strikes and was assessed multiple fines for failing to meet service quality standards in Maine.

“The last time these assets were sold to FairPoint it was a disastrous outcome for Maine customers,” says Tim Schneider, Maine’s Public Advocate, who represents consumers on utility matters.

Schneider told Maine Public Radio he is planning to scrutinize the deal to prevent further problems, but customers in Maine, New Hampshire, and Vermont are already expressing concern regulators are just as likely to rubber stamp this sale just like the last one, further saddling them with problematic service.

The owners of Maglan Capital are pleased with themselves, tweeting out this is a “December to Remember.”

One transaction done this month on FairPoint $FRP $CNSL. $GSAT $MVN $MDLNF on the queue next #DecembertoRemember

— Maglan Capital (@MaglanCapital) December 5, 2016

When AT&T announced it would offer 100+ cable television and broadcast network channels under the DirecTV Now brand for $35 a month, Wall Street had a fit.

Craig Moffett, an analyst with Moffett-Nathanson, speculated that AT&T would make at most a profit margin of $5 a month for its $35 a month plan, once programming costs were covered. But then AT&T announced it would sweeten the deal with a free Apple TV Player or Amazon Fire Stick for those confident enough to prepay for the new service. That makes DirecTV Now a purposefully unprofitable service, creating considerable stress for both the cable and satellite industry and their investors.

Variety notes the average DirecTV satellite subscriber delivers about $60 a month in profit to its owner, AT&T. That led the industry magazine to speculate DirecTV Now is a “loss leader” designed to sell its parent company’s AT&T-Time Warner, Inc. merger deal to regulators on the premise of increased competition delivering real savings to consumers.

Thankfully for Wall Street’s nerves, AT&T’s usual practice of marketing things with a lot of fine print emerged in the nick of time, and the $35 dollar price has now turned out to be an introductory offer for early adopters. In the not-too-distant future, AT&T will enroll new customers for its “Go Big” package at a much more profitable $60 a month. Customers who sign up at the $35 rate and stay customers will be able to keep that price as long as they make no changes to their account after the promotion ends.

But Moffett warned investors that the traditional cable television model is still under serious threat, and AT&T’s less-promoted “Live a Little” package offering 60 popular cable networks for the everyday price of $35 is the equivalent of AT&T “running with scissors” because it alone could cause millions of cable and satellite customers to cut the cord and stay more than satisfied with a slimmed down cable package.

“Virtually all the channels that anyone would really want, save for regional sports networks” are included in the lighter “Live a Little” package, Moffett added. Customers who loathe watching sports but want a beefier package can also sign up for a $50, 80-channel “Just Right” package that primarily omits sports-oriented channels and a handful of spinoff cable networks few would miss.

Moffett and other Wall Street analysts were hoping AT&T would bloat its cheaper package with home shopping, religion, and other little-watched, low-cost cable networks and then entice customers to upgrade to unlock more popular cable channels. Instead, AT&T’s most premium package — “Gotta Have It” which costs $70 a month adds the “can live without” networks like Boomerang, Cloo, El Rey, Centric, and other little-known channels that typically live unnoticed in Channel Siberia on 500+ channel cable lineups. The highest premium priced package is attractive only for those looking for Starz/Encore channels and the basic cable network that gets no respect — Hallmark Movies & Mysteries (a/k/a the Dick van Dyke Permanent Employment Network.)

“By stacking their base package with all the best networks — likely a requirement for getting the programming contracts at all — they still have the same problem that was highlighted initially,” by Moffett. “Put simply, they aren’t going to make any money.”

That quest for profit is further challenged with subscriber acquisition programs that dole out free Apple TV units to customers willing to prepay for three months of service at the $35 rate or an Amazon Fire Stick (with Echo remote) in return for prepaying for one month of service. Anyone in the market for either device can sign up for DirecTV Now, get the equipment at an attractive price, and consider the 1-3 months of service a free extra bonus. Customers were reportedly lining up at AT&T’s owned and operated retail outlets (not authorized resellers) to pick up devices and sign up for service today.

At these prices and with these promotions, AT&T DirecTV Now could first decimate the subscriber base of its immediate competitors Sling TV and PlayStation Vue, either of which offer a much less compelling value. AT&T can afford to charge a lower price because it has deeper pockets and enormous volume discounts on the wholesale price of cable programming — combining millions of DirecTV and U-verse TV subscribers together to negotiate what industry insiders suspect are major discounts the smaller providers cannot get.

But there are issues likely to be deal-breakers for some would-be DirecTV Now subscribers:

• Local broadcast stations are available only in a handful of selected cities and only a very few include all ABC, NBC, and FOX affiliates. CBS is not participating in DirecTV Now at this time, and that is a major omission;
• NFL Network isn’t on the lineup;
• Regional sports networks are spotty and geographically restricted. Here is a detailed PDF outlining options by zip code;
• There is a limit of two concurrent streams and although video quality is very good, it is not the 1080/HD experience AT&T’s marketing material would suggest. The quality of your internet connection will make a difference;
• No DVR option at this time.

CNET compiled an excellent channel comparison chart to help consumers figure out which, if any, of these upstarts make sense as a cable TV replacement:

DirecTV Now vs. Sling TV vs. PlayStation Vue (top 169 channels, see notes below)

Channel	DirecTV Now Packages	Sling Package	Vue Package
A&E	Live a Little	Orange, Blue	No
ABC	Yes or VOD	Broadcast extra	Yes or VOD
AMC	Live a Little	Orange, Blue	Access
American Heroes	Go Big	No	Elite
Animal Planet	Live a Little	No	Access
Audience	Live a Little	No	No
AXS TV	Live a Little	Orange, Blue	No
Baby TV	No	Kids extra	No
BBC America	Live a Little	Orange, Blue	Access
BBC World News	Go Big	News extra	Elite
beIN Sports	No	Sports extra	Core
BET	Live a Little	Blue (Orange lifestyle extra)	No
Bloomberg TV	Live a Little	Base	No
Boomerang	Gotta Have It	Kids extra	Elite
Bravo	Live a Little	Blue	Access
BTN	Just Right	No	Core
Campus Insiders	No	Sports extra	No
Cartoon Network/Adult Swim	Live a Little	Orange, Blue	Access
CBS	No	No	Yes or VOD
CBS Sports	No	No	No
Centric	Go Big	No	No
Cheddar	No	Orange, Blue	No
Chiller	Gotta Have It	No	Elite
Cinemax	PREMIUM ($5/month)	PREMIUM	No
Cloo	Gotta Have It	No	Elite
CMT	Live a Little	Comedy extra	No
CNBC	Live a Little	News extra Blue	Access
CNBC World	Just Right	No	Elite
CNN	Live a Little	Orange, Blue	Access
Comedy Central	Live a Little	Orange, Blue	No
Comedy.TV	Just Right	No	No
Cooking Channel	Just Right	Lifestyle extra	Elite
CSPAN	Live a Little	No	No
Destination America	Go Big	No	Access
Discovery Channel	Live a Little	No	Access
Discovery Family	Go Big	No	Access
Discovery Life	Go Big	No	Elite
Disney Channel	Live a Little	Orange	Access
Disney Junior	Live a Little	Kids extra Orange	Access
Disney XD	Live a Little	Kids extra Orange	Access
DIY	Go Big	Lifestyle extra	Access
Duck TV	No	Kids extra	No
E!	Live a Little	Lifestyle extra Blue	Access
El Rey Network	Gotta Have It	Orange, Blue	No
Encore	Gotta Have It	No	No
EPIX	No	Hollywood extra	No
EPIX Drive-in	No	Hollywood extra	No
EPIX Hits	No	Hollywood extra	PREMIUM, Elite
EPIX2	No	Hollywood extra	No
ESPN	Live a Little	Orange	Access
ESPN 2	Live a Little	Orange	Access
ESPN Bases Loaded	No	Sports extra Orange	No
ESPN Buzzer Beater	No	Sports extra Orange	No
ESPN Deportes	No	Spanish TV extra Orange	Elite
ESPN Goal Line	No	Sports extra Orange	No
ESPNEWS	Just Right	Sports extra Orange	Core
ESPNU	Just Right	Sports extra Orange	Core
Esquire	No	No	Access
Euro News	No	World News Extra	No
Flama	No	Orange, Blue	No
Food Network	Live a Little	Orange, Blue	Access
Fox	Yes or VOD	Blue	Yes or VOD
Fox Business	Live a Little	No	Access
Fox College Sports Atlantic	No	No	Elite
Fox College Sports Central	No	No	Elite
Fox College Sports Pacific	No	No	Elite
Fox News	Live a Little	No	Access
Fox Sports 1	Live a Little	Blue	Access
Fox Sports 2	Go Big	Blue	Access
Fox Sports Prime Ticket	Just Right	No	No
France 24	No	World News Extra	No
Freeform	Live a Little	Orange	Access
Fuse	Just Right	No	No
Fusion	Just Right	World News Extra	Elite
FX	Live a Little	Blue	Access
FXM	Go Big	No	Elite
FXX	Live a Little	Blue	Access
FYI	Go Big	Lifestyle extra	No
Galavision	Live a Little	Orange, Blue	No
Golf Channel	Go Big	Sports extra Blue	Core
GSN	Just Right	Comedy extra	No
Hallmark	Live a Little	Lifestyle extra	No
Hallmark Movies & Mysteries	No	LIfestyle extra	No
HBO	PREMIUM ($5/month)	PREMIUM	PREMIUM, Ultra
HDNet Movies	No	Hollywood extra	No
HGTV	Live a Little	Orange, Blue	Access
Hi-Yah	No	No	Elite
History	Live a Little	Orange, Blue	No
HLN	Live a Little	News extra	Access
HSN	No	No	No
IFC	Just Right	Orange, Blue	Core
Ion	No	No	No
Impact	No	No	Elite
Investigation Discovery	Live a Little	No	Access
JusticeCentral.TV	Just Right	No	No
Lifetime	Live a Little	Orange, Blue	No
LMN	Just Right	Lifestyle extra	No
Local Now	No	Orange, Blue	No
LOGO	Go Big	Comedy extra	No
Longhorn Network	Just Right	No	No
Machinima	No	No	Elite
Maker	No	Orange, Blue	No
MGM-HD	No	No	Elite
MLB Network	Just Right	No	No
Motors TV	No	Sports extra	No
MSNBC	Live a Little	News extra Blue	Access
MTV	Live a Little	Comedy extra	No
MTV Classic	Go Big	No	No
MTV2	Live a Little	Comedy extra	No
Nat Geo Wild	Go Big	Blue	Elite
National Geographic	Live a Little	Blue	Access
NBA TV	Go Big	Sports extra	Core
NBC	Yes or VOD	Blue	Yes or VOD
NBC Sports Network	Just Right	Blue	Access
NDTV 24/7	No	World News Extra	No
News 18 India	No	World News Extra	No
Newsy	No	Orange, Blue	No
NFL Network	No	Blue	Core
NFL Red Zone	No	Sports extra (Blue)	PREMIUM (Core and up)
NHL Network	Go Big	Sports extra	No
Nick Jr.	Live a Little	Blue	No
Nickelodeon	Live a Little	No	No
Nicktoons	Live a Little	Kids Extra Blue	No
ONE World Sports	No	No	Elite
Outdoor Channel	No	No	No
Outside Television	No	Sports extra	Elite
OWN	Just Right	No	Access
Oxygen	Just Right	Lifestyle extra Blue	Access
Palladia	No	No	Elite
PBS	No	No	No
Poker Central	No	No	Elite
Polaris	No	Orange, Blue	Elite
POP	No	No	Access
QVC	No	No	No
Revolt	Go Big	No	No
RFD TV	Live a Little	No	No
Russia Today	No	World News Extra	No
Science	Just Right	No	Access
SEC Network	Just Right	Sports extra Orange	Core
Showtime	No	No	PREMIUM, Elite
Spike	Live a Little	Comedy extra	No
Sprout	Go Big	No	Elite
Starz	Gotta Have It	PREMIUM	No
Sundance TV	Go Big	Hollywood extra	Core
Syfy	Live a Little	Blue	Access
TBS	Live a Little	Orange, Blue	Access
TCM	Live a Little	Hollywood extra	Core
Teen Knick	Live a Little	Kids extra Blue	Elite
Telemundo	Live a Little	No	No
Tennis Channel	Go Big	No	No
The Weather Channel	Live a Little	No	No
TLC	Live a Little	No	Access
TNT	Live a Little	Orange, Blue	Access
Travel Channel	Just Right	Orange, Blue	Access
truTV	Live a Little	Blue (Orange comedy extra)	Access
TV Land	Live a Little	Comedy extra	No
TVG	Go Big	No	No
Universal HD	No	No	Elite
Univision	Live a Little	Blue (Orange Broadcast extra)	No
Univision Deportes	Gotta Have It	Sports extra	No
Univision Mas	Just Right	Blue (Orange Broadcast Extra)	No
USA Network	Live a Little	Blue	Access
Velocity HD	Live a Little	No	Elite
VH1	Live a Little	Lifestyle extra	No
VH1 Classic	No	No	Elite
Vibrant TV	No	Lifestyle extra	No
Viceland	Live a Little	Orange, Blue	No
WE tv	Live a Little	Lifestyle extra	Access
WeatherNation	Live a Little	No	No

Notes

Broadcast networks including ABC, CBS, Fox and NBC are not available for live streaming in many cities, except where noted as “yes.” The term “VOD” means viewers can watch these shows on-demand 24 hours after airing.

Most RSNs (Regional Sports Networks) not listed; varies per locality PREMIUM = Available for an additional monthly fee beyond base package DirecTV Now package key: Live a Little = $35/month (Local ABC, Fox, NBC broadcasts included in select markets) Just Right = $50/month Go Big = $60/month ($35 / month introductory price) Gotta Have It = $70/month Sling TV package key: Orange = $20/month Blue = $25/month other “”extras”” = another $5 /month each (Sports extra with Blue is $10) Broacast Extra: ABC, Univision and Univision Mas available to Sling Orange subscribers in select cities PlayStation Vue package key: (for New York, Los Angeles, Chicago, Philadelphia, Dallas, San Francisco, Miami ONLY) Access (Base) = $40/month Core = $45/month (includes Access channels, some Regional Sports Networks) Elite = $55/month (includes Access and Core channels) Ultra = $75/month (includes Access, Core and Elite channels, plus HBO and Showtime) (for all other cities, where ABC, CBS, Fox and NBC are available via VOD only) Access Slim (Base) = $30/month Core Slim = $35/month (includes Access channels, some Regional Sports Networks) Elite Slim = $45/month (includes Core and Access channels) Ultra Slim = $65/month (includes Access, Core and Elite channels, plus HBO and Showtime)

Time Warner, Inc. did its part, offering a substantial deal to DirecTV Now to allow customers to add HBO and Cinemax for just $5 a month each, substantially less than what both networks charge customers signing up a-la-carte. This also unlocks access to streaming options on both networks’ websites.

In fact, as a DirecTV Now customer, you will also become an authenticated pay television subscriber, unlocking access on various cable network websites to extra streaming and on-demand options.

The implications of DirecTV Now depend on how long AT&T extends its $35 offer, which is going to be compelling for a lot of Americans. Moffett predicts DirecTV Now could sign up a staggering 11 million Americans — at least two million cannibalized from its own DirecTV satellite customer base, six million cutting the cord on their cable company (including AT&T U-verse) and another three million cord-cutters or “cable-nevers.” Most of the latter are Millennials, and research suggests $35 may be low enough of a price point to sign them up.

AT&T is also raising concerns among internet activists because online streaming of DirecTV Now will not count against an AT&T postpaid customer’s data allowance. This zero rating scheme is seen as an end run around Net Neutrality, particularly because AT&T is not as generous with its competitors. AT&T said it will offer other video streamers the possibility of being exempted from AT&T data allowances, if they pay AT&T for the privilege.

How It Works/Signing Up

AT&T DirecTV Now starts with the Google Chrome 50+, Safari 8+ or Internet Explorer 11+ (on Windows 8 and up) web browsers or the DirecTV Now app. AT&T recommends Chrome for desktop viewing. The service doesn’t work with Firefox, Microsoft Edge, or legacy browsers.

The first step is registering for a 7-day free trial. Before handing over your credit card number, if you scroll down you will find a small free preview option is also available that includes a largely useless streaming barker channel promoting the service and a respectable collection of video on demand options from basic cable networks. The free video streaming option will give you a clue about how the service is likely to perform on your internet connection and devices. For the record, DirecTV Now now supports:

• Amazon Fire TV
• Amazon Fire TV Stick
• Apple TV (4th generation)
• Android^TM phone 4.4 and higher
• Android tablet 4.4 and higher
• Chromecast (for Android only)
• iPad iOS 9 and higher
• iPhone iOS 9 and higher
• iPod Touch version 9 and higher

Support for other devices like Roku is coming next year.

Customers must be within the United States to use the service. If you travel abroad or to any U.S. territories like Guam, the Virgin Islands, or Puerto Rico, DirecTV Now will stop working until you return. When you sign up, keep in mind your billing zip code will mean a lot when it comes to accessing regional sports and local broadcast channels. DirecTV Now uses your billing zip code and your actual location to determine whether you are qualified to access regional sports networks and local stations.

Score a Free Apple TV Player or Amazon Fire TV Stick

If you are looking to score an Apple TV (4th generation) or an Amazon Fire TV Stick, you will want to skip the 7-day free trial and enroll in a paid plan immediately, which will allow you to select which player you want. If you want the Apple TV, you will prepay for three months at $35 a month ($105). The Amazon Fire TV Stick only requires you to prepay for the first month of service ($35). One device per email address, but you can sign up for multiple accounts (using individual email addresses) and get a device for each — especially useful for larger families that could run into DirecTV Now’s two-stream limit.

Consider your choices before enrolling. If you want to add premium channels or upgrade your plan, and you select the three-month prepay option to grab an Apple TV Player, adding premium channels like HBO and Cinemax or moving to a higher plan will result in three months of prepaid charges for those upgrades as well, billed automatically to your credit card on file — which amounts to a $30 charge if you select HBO and Cinemax. After your promotional prepaid term ends, your account will continue to be billed at the $35 (plus any add-ons) rate until you cancel. AT&T covers you for the forfeited first free week by extending your bill date out by seven days. Allow 2-3 weeks for the device(s) to be shipped to you.

You can also sign up at an AT&T owned and operated retail store, but be aware AT&T “authorized” reseller stores are not participating in this promotion. That may allow you to bring home a device today.

Don’t care about the device promotions? Take the 7-day free trial, but be aware that you are giving AT&T your credit card number and charges begin immediately after the free week ends unless you cancel. Here’s how:

1. Sign in to your account.
2. From your User Account overview page, select Manage My Plan.
3. Select the Cancel Plan link.
4. Choose one of the listed reasons.
5. Select Cancel Now to confirm cancellation.

Your subscription will continue until the end of the billing cycle. No refunds or credits are provided for partial months. Your account will revert to Freeview demo status after you cancel a subscription.  You can add a subscription package back at any time.

Oddly, AT&T is not charging sales tax for New York, California, Maryland or Virginia residents. Customers in states like Tennessee where AT&T provides local phone service were most likely to face sales taxes. Those signing up early are in the best position to exploit what appears to be an oversight, or it represents the first time the New York Department of Taxation and Finance left money on the table.

Streaming from Your AT&T Wireless Device Does Not Count Against Your Data Allowance

If you’re a DirecTV Now and AT&T Wireless customer, streaming most DirecTV Now movies and programs over the AT&T wireless network won’t count against your data usage allowance, according to AT&T. But believe it or not, AT&T’s fine print indicates advertisements and non-streaming app activity do count! There are some other important disclosures to be aware of:

• You must be on the AT&T Wireless network within the U.S. (U.S. territories are not qualified for zero rating);
• You must be a postpaid, not a prepaid AT&T wireless customer to qualify and must not have “data block” on your mobile line;
• If you are grandfathered on an unlimited data plan, using DirecTV Now will not count against the 22GB data threshold which subjects you to speed throttling;
• This offer may disappear at any time and/or is subject to change.

DirecTV Now Qualifies You as an Authenticated Pay Television Subscriber

Many cable networks require customers enter their cable, satellite, or telco TV login credentials to unlock video streaming and on-demand features. DirecTV Now is a qualified provider for these websites (more coming):

• ABC
• Disney
• Disney Jr.
• Disney XD
• ESPN (WatchESPN)
• Freeform
• HBO GO (requires subscription to HBO)
• MAX GO (requires subscription to Cinemax)

Other networks are not yet enabled for DirecTV Now. CNN, for example, has a prompt for DirecTV satellite customers to log in, but DirecTV Now has its own account registration system.

Local Channels Are Very Spotty

Local over the air channels are very limited on DirecTV Now and are geographically restricted. You can access these channels only if you are located in or very near to the cities listed below and your billing zip code is in the same area. If you travel outside of the immediate area, live streaming will stop working until you return.

Giving the Service a Test

Stop the Cap! enrolled as an ordinary customer this morning and gave the service a rigorous test, including multiple streams over our 50/5Mbps internet connection. The service debuted today, and there is little doubt there is intense interest from consumers, so we expected some performance problems from the initial demand. We didn’t see any evidence of traffic congestion, however, and that is a good sign.

A similar test of Sling TV did not perform as well during peak viewing times, when streaming problems emerged. DirecTV Now seems to be built to withstand intense demand.

One customer with a 6Mbps U-verse internet connection “in the boonies” was impressed the video quality of DirecTV Now was high even on a relatively slow DSL-like connection.

“This blows SlingTV away,” the person shared. “I only have U-verse 6Mbps internet service and it is not pixelated or buffering at all. Looks exactly like my regular DirecTV picture.”

AT&T published these recommendations for DirecTV Now customers regarding internet connection speeds:

• 150kbps – 2.5Mbps – Minimum broadband connection speed for Mobile devices
• 2.5 – 5.0Mbps – Recommended for HD quality

We’ve been led to believe DirecTV Now should perform equivalently to 1080i HDTV service (depending on the video source of course). We cannot say we agree it does right now. We noticed significant artifacts on high-motion video and picture graininess that left us feeling this was closer to a 720p HD experience. It isn’t possible to say whether the video player reduced playback quality because of internet traffic issues we were unaware of or if this is how the picture is supposed to look. It did not significantly detract from the viewing experience and the lack of buffering and pixelation was far more important to us.

DirecTV Now would serve adequately as a cable TV replacement if it had local station coverage and some type of DVR. At present, DirecTV Now is limited to a “Restart” feature that allows you to restart shows already in progress on certain channels, but you cannot fast-forward or record a restarted show. Once AT&T introduces a cloud-based DVR and fills out the local station lineup, this service could be lethal to overpriced cable TV packages.

AT&T’s marketing attempts to undercut the powerful position of inertia by setting an unknown time limit for customers to enroll in the $35 a month video package. If you don’t sign up today, you may not get the “free” Apple TV or Amazon Fire Stick and a respectable cable TV package for just $35 a month — about half what cable operators are charging these days for their bloated video packages. AT&T doesn’t care if you stick with your current cable provider and signup for DirecTV Now, if only to grab free streaming video equipment while sampling the service. They get their money either way.

Had AT&T permanently kept the price at around $35, many consumers would likely sit back and wait for AT&T to sort out the streaming contract issues it has with the TV networks — CBS in particular, and come up with a DVR solution before those potential customers decided to sign up and make the change. Based on several “hot deals” websites, the mentality among many consumers is to “lock in” the $35 price now and wait for AT&T to build out the package while continuing to invest $35 a month on it. That doesn’t seem so bad when you get free electronics as part of the deal.

Our Final Take

AT&T’s DirecTV Now is a potential winner and worth signing up for because of the introductory price and free equipment offers. But if you decide not to disconnect your cable/satellite television service, it is probably safe to drop DirecTV Now after your prepayment expires and return to resume service a little later. There will probably be some warning when AT&T will end the introductory price for the service, and interested customers can hop back on board before that date arrives. DirecTV Now will be a formidable competitor, but it will fight against consumer resistance to confront the cable company and cut cable’s cord until it solves the local channels issue and has a credible DVR option. The service could also use an add-on to make adding additional concurrent streams possible and more affordable than just signing up for a second account.

Don’t count out Big Cable just yet. With data caps and other internet overcharging schemes, Comcast, Cox, Suddenlink, and others can play games with usage allowances to deter customers from streaming all of their video entertainment online at the risk of blowing past their allowance. DirecTV Now’s $35 price won’t mean much after overlimit fees begin appearing on your internet bill.

Many of President-elect Donald Trump’s choices for America’s newest regulators have track records of being so “hands-off,” it is hard to find their fingerprints.

Wall Street expects the Trump Administration and the Republican majority in Congress to eliminate vast swaths of regulatory oversight, perhaps enough to put the federal government’s involvement in commerce at a level not seen since before the Great Depression. UBS analyst John Hodulik believes the Trump Administration will look the other way as an unprecedented frenzy of corporate mergers and acquisitions begins — mergers that would never have passed an antitrust review during prior administrations.

Hodulik might as well suggest the next four years could represent The Great Convergence, as cable and wireless operators merge, potentially leaving the majority of Americans with just one choice for telecommunications services.

“We have long believed that secular changes in technology and usage would lead to the convergence of the cable and wireless industries,” Hodulik said. “The transformation of the internet into a mobile-first platform combined with the rapid migration of video from proprietary networks to digital and the rise in competitive pressure this entails increases the value of an integrated fixed and wireless service to cable providers. Densification of wireless networks required to meet the needs of video-centric subscribers increases synergies of cable-wireless combinations and provides the springboard for 5G-based services. A roll-back of Title II re-classification could further increase incentives for cable.”

Hodulik envisions that a wave of mergers during the first term of the Trump Administration could look like this:

• Comcast <-> Verizon: Conquering the northeast and mid-Atlantic states, a supersized Comcast would likely be the only telecommunications company offering broadband service in states like New Jersey, Delaware, and Maryland with Verizon FiOS just another flavor of Comcast’s coaxial and fiber network. The only remaining competitors of significance would be Frontier Communications in Connecticut and upstate New York and FairPoint Communications in northern New England. Charter Communications would also still provide cable service in New York, Massachusetts, and parts of the Carolinas. Hodulik called the effective monopoly a win-win for shareholders of Comcast and Verizon. Customers are likely to hold a different view.
• Charter <-> T-Mobile/Sprint or Dish Networks: As the number two player, Charter already envisions offering wireless phone service through an arrangement it has with Verizon. But in a “converged” world, why rent someone else’s network when you can buy your own. Deutsche Telekom has been a motivated seller since AT&T tried and failed to buy T-Mobile USA and Sprint’s largely uninspiring performance may make it an easy sell for Japan’s Softbank. The wildcard: Dish Networks. Charter might want Dish’s huge number of video subscribers to win itself better volume discounts for cable programming.
• Never forget about Altice, laying the foundation for another wave of buyouts starting in 2017. So far, Altice seems interested in the handful of remaining independent cable companies — Cox, Cable One, Mediacom, and the few others increasingly becoming anomalies in the consolidated cable marketplace. Cox and Mediacom may have to be coaxed to sell much the same way Cablevision was — by overpaying.

Hodulik also believes some side mergers may also turn up, especially a Dish/T-Mobile deal that would bring Dish’s large wireless spectrum holdings into T-Mobile’s network. T-Mobile could also sell Dish programming by streaming it over the internet and/or mobile devices.

Next time you are on hold or waiting for the service technician to show up to diagnose your interminably slow DSL, here is what the folks at Frontier might be doing instead of taking your call or delivering anything close to the FCC’s 25Mbps standard to qualify as real broadband.

OMG. I just can’t even describe this. From the folks at Frontier Communications Exposed. (4:37)