GIVE us more money and TAKE what we offer you.

Bloomberg News is reporting what many of you already know — it is getting tougher to get a better deal from your cable or phone company.

As Stop the Cap! has documented since the completion of the Time Warner Cable/Bright House/Charter Spectrum merger in 2016, companies are pulling back on promotions, taking advantage of a lack of competition and offering best pricing only to new customers.

Charter Spectrum and Cable One (soon to be Sparklight) are the most notorious for implementing “take it or leave it” pricing. In fact, one of Charter CEO Thomas Rutledge’s chief complaints about Time Warner Cable was its “Turkish Bazaar” mentality about pricing. Rutledge claimed Time Warner Cable had as many as 90,000 different promotions running at the same time, typically targeted on what other companies were theoretically providing service and how serious the representative felt you were about canceling service. Time Warner Cable had basic retention plans available for regular representatives to offer, better plans for retention specialists to pitch, and the best plans of all to customers complaining on the “executive customer service” line or after filing complaints with the Better Business Bureau. There were plans for complaining over the phone and different plans for complaining at the cable store. Rutledge was horrified, because customers were now well-trained on how to extract a better deal every year when promotions ran out.

Last month, Rutledge said he was indifferent about cash-strapped consumers that cannot afford a runaway cable TV bill on a retired/fixed income or the urban poor who can’t imagine paying $65 a month for basic broadband service. To those customers, pointing to the exit is now perfectly acceptable. In fact, companies make more profit than ever when you drop cable television service and upgrade your broadband connection to a faster speed. That is because there is up to a 90% margin on internet service — provisioned over a network paid off decades ago and designed for much less space efficient analog television. Charging you $20 more for faster internet service is nearly 100% profit and costs most companies next to nothing to offer, and Time Warner Cable executives once laughed off the financial impact of so-called “heavy users,” calling data transport costs mere “rounding errors.” 

Even with a much tougher attitude about discounting service, Charter and Comcast are still adding new broadband customers every month, usually at the expense of phone companies still peddling DSL. So if you cancel, there are probably two new customers ready to replace you, at least for now.

Cable One redefines rapacious pricing. The company specializes in markets where the incumbent phone company is likely to offer low-speed DSL, if anything at all. As a result, they have a comfortable monopoly in many areas and price their service accordingly. Cable One’s basic 200 Mbps plan, with a 600 GB data cap, costs $65 a month, not including the $10.50/mo modem fee, and $2.75 monthly internet service surcharge. To ditch the cap, you will pay another $40 a month — $118.25 total for unlimited internet.

In fact, Cable One charges so much money for internet, they even have Wall Street concerned they are overcharging!

When Joshua May tried calling Spectrum to deal with the 29% more it wanted (around $40 a month) after his promotion expired, the customer service representative told him to go pound salt.

“I expected they’d at least offer free HBO or Showtime,” May, 34, of Springfield, Ohio, told Bloomberg News. “They did nothing.”

He did something. He cut the cord. The representative could have cared less.

The product mix cable and phone companies offer has not really changed, but the era of shoving a triple play bundle of internet, TV, and phone service sure has. Charter and Comcast now treat cable television as a nice extra, not the start of a bundle offer. Broadband is the key item, and the most profitable element, of today’s cable package. Beleaguered phone service gets no respect either. Time Warner Cable used to sell its triple play bundle including a phone line for less money than their double play bundle that omitted it. Today, it’s a simple $9.99/mo extra, given as much attention as a menu offering premium movie channels.

Comcast differs from Charter by offering a plethora of options to their customers. If you don’t want to spend a lot for high speed internet, spend a little less for low speed internet. Their television packages also vary in price and channel selection, often maddeningly including a “must-have” channel in a higher-priced package. Like Spectrum, their phone line is now an afterthought.

AT&T and Verizon have their own approaches to deal with reluctant customers. Verizon FiOS customers face steep price hikes when their promotions expire, but the opportunity to score a better deal is still there, if Verizon is in the mood that quarter. Verizon remains sensitive about their subscriber numbers and growth, so when a quarter looks like it will be difficult, the promotions turn up. AT&T prefers to play a shell game with their customers. Most recently, the company has given a cold shoulder to its U-verse product, treating it like yesterday’s news and best forgotten. AT&T literally markets its own customers to abandon U-verse in favor of AT&T Fiber. Verizon and AT&T treat their DSL customers like they are doing them a favor just by offering any service. All the best deals go to their fiber customers.

AT&T Randall Stephenson is a recent convert to the “who cares about video customers” movement. Services like DirecTV Now were originally channel-rich bargains, but now they are a place for rate hikes and channel deletions. Over a half-million streaming customers have already canceled after the most recent price hikes, but Stephenson claims he does not mind, because those bargain-chasers are low-quality customers worthy of purging. AT&T’s dream customer is one who appreciates whatever AT&T gives them and does not mind a parade of rate hikes.

Comcast’s chief financial officer Mike Cavanagh said it more succinctly: seeking subscribers that “really value video and our bundle despite the increases in prices,” and has “the wallet for a fuller video experience.”

Customers who decide to take their business to a streaming competitor are already learning the industry still has the last laugh. As package prices head north of $50/month, that is not too far off from the pricing offered by cable and phone companies for base video packages. In fact, Spectrum has begun undercutting most streaming providers, offering $15-25 packages of local and/or popular cable channels with a Cloud DVR option for around $5 more a month.

As AT&T bleeds satellite and streaming TV customers, a new class action case is planned on behalf of investors who feel ripped off after buying AT&T stock on assurances from top executives that the company was aggressively seeking a leadership role for its DirecTV Now streaming service.

According a complaint from the Schall Law Firm, AT&T made false and misleading statements to the market and caused some investors to lose more than $100,000 from the declining value of AT&T stock.

DirecTV Now entered the streaming business with a generous package of TV channels and a significantly lower price than some of its competitors. It also offered high value promotions including free equipment, and for some AT&T wireless customers, free service. By October 2018, DirecTV Now grew to a peak of 1.85 million customers.

But several weeks later, AT&T CEO Randall Stephenson announced the service was cutting back on promotions and planned to raise prices and cut back on the number of channels to boost profits.

“This resulted in existing customers leaving the service when their discount expired, and new customers avoiding the service altogether based on high prices,” the Schall Law Firm said in a press release. “Based on these facts, the company’s public statements were false and materially misleading. When the market learned the truth about AT&T, investors suffered damages.”

Publicly traded companies cannot lie or deceive investors in public statements about the company or its performance, according to securities laws. Shareholders are entitled to prompt and forthcoming disclosures about materially adverse events that could significantly impact on the performance of a company. AT&T has already lost over 500,000 TV customers in the first quarter of 2019. Stephenson this month told investors at a J.P. Morgan Conference he now expects more customer losses for the rest of 2019, including more than a half-million more anticipated cancellations during the second quarter of this year. Stephenson called it a “customer cleanup” that will purge “low value” subscribers.

Investors with significant losses were encouraged to reach out to the law firm before May 31, 2019.

Effective today, Hulu is now under the full control of the Walt Disney Company, ending a decade of a sometimes-uneasy partnership between rivals NBC-Universal, 21st Century Fox, Disney-ABC and Time Warner (Entertainment).

This morning, Disney and Comcast, the last two partners in the streaming venture, reached an agreement that will give full operational control of Hulu to Disney, in return for either company having the right to force Disney to buy out Comcast’s remaining 33% interest in the service beginning in 2024. In effect, with Comcast giving up its three seats on Hulu’s board and its veto power, the cable company now becomes a passive partner in the venture. At a Disney-guaranteed value of at least $27.5 billion five years from now, Comcast could eventually walk away from Hulu with at least $9 billion in compensation.

Today’s agreement means Disney will own and control multiple streaming services. Disney today announced it has big plans for Hulu, despite preparing to launch its own Disney+ streaming service and already operating its own streaming platform for ESPN. Disney CEO Robert Iger said Disney+ will now be focused on kids and family-friendly entertainment, while Hulu will be Disney’s platform for adult-focused movies and series. Disney’s recent acquisition of the 20th Century Fox content library and FX’s suite of cable channels gives it plenty of additional content to bring to both of its general entertainment streaming services.

To make sure of a smooth transition, both companies have agreed to a lucrative extension of Hulu’s license to stream NBC-Universal content and networks, as well as a retransmission consent agreement to allow Hulu Live to continue carrying NBC-Universal networks and TV channels until the end of 2024. That will deliver a significant revenue boost to Comcast, which can use the money to help build its own forthcoming streaming platform, launching in 2020.

“We are now able to completely integrate Hulu into our direct-to-consumer business and leverage the full power of The Walt Disney Company’s brands and creative engines to make the service even more compelling and a greater value for consumers,” said Iger in a statement.

NBC-Universal chief executive Steve Burke said in a statement that the deal is “a perfect outcome for us” because the “extension of the content-licensing agreement will generate significant cash flow for us, while giving us maximum flexibility to program and distribute to our own direct-to-consumer platform.”

For consumers, Iger is expected to consider offering a discounted bundled package to Hulu subscribers who also sign up for Disney+. With a combination of Hulu and Disney+, Netflix’s biggest U.S. rival is about to get considerably bigger.

Apple today released a software update for iOS device owners and some smart televisions that includes a new Apple TV streaming app designed to simplify the online streaming experience.

The Apple TV app works similarly to Roku’s collection of subscription services. Through the app, viewers in 100 countries can subscribe to individual networks and access them without launching multiple separate apps to watch. Apple TV app also manages billing and collects viewing interests to provide recommended new shows and movies.

At present, most premium channels are available through the app for subscription, but you will pay a non-discounted price for each service, often at a premium. HBO, for example, can be had for as little as $5 a month through some platforms, but costs $14.99 through Apple TV. Other services often run their own discounted specials, but Apple TV customers will not get that pricing. Cord Cutters News reports these networks were available for purchase as of this morning (others are being beta tested):

• HBO
• Showtime
• Starz
• Cinemax
• Epix
• Smithsonian Plus
• PBS Living
• Acorn TV
• Sundance Now
• Lifetime Movie Club
• Urban Movie Channel
• Tastemade
• Curiosity Stream
• MTV Hits
• Comedy Central Now

Apple TV is a precursor to the company’s more elaborate streaming and original content platform — Apple TV+ — expected to launch this fall. For now, Apple is taking a cut from reselling other companies’ content and wrapping it around its own interface. Some early subscribers report Apple TV subscribers get more generous multiple viewer allowances, and a large selection of live streams of certain networks like HBO that are not even available from HBO’s own app. Because finding content across a wide array of subscription services is becoming more complicated, users can also access a search utility to find favorite shows.

By developing its own ecosystem, Apple hopes to build an audience and subscriber loyalty by getting customers accustomed to visiting Apple TV to access their subscription content, which gives Apple an audience to sell other programming and content. In return, customers will not have to install multiple apps, or keep track of usernames and passwords for each of them.

Owners of recent Apple devices, as well as those with 2019 Samsung smart TVs (and some 2018 models) will find software updates including Apple TV starting today. Later this year, customers with certain Vizio, LG and Sony TVs will be able to use the TV app using AirPlay 2.

There are some caveats. Netflix is missing. The largest streaming provider in the world has made it clear it will not be a part of the Apple TV app. Also, only a handful of cable and streaming providers have signed on to allow customers to authenticate their TV subscriptions through the Apple TV app so far: Charter Spectrum, DirecTV Now and PlayStation Vue.

Those looking for convenience might find the Roku or Apple TV platforms a good place to bring content from multiple services together, but those looking for the best price will save money shopping around for subscription deals not available from Apple TV.

Discovery’s forthcoming streaming service will focus entirely on family-friendly factual, historical, and natural history content and will be sold for around $4.99 a month when it launches in 2020.

“There is really nobody in our space,” said Discovery CEO David Zaslav, talking to investors on a quarterly results conference call. “Discovery’s strategy is different than any other media company. While everyone else is focused on big and expensive movies and scripted series, very crowded space, we have a different approach. We have brand people identify with and love. We’re gaining distribution in all key bundles in the United States and around the world and enjoy a unique global footprint.”

With a decade long content deal with the BBC’s Natural History Unit in place, Zaslav told investors Discovery is about to flood North America with an unprecedented amount of factual, on-demand programming.

“The most strategic element of our BBC deal was securing all of the [streaming/video on demand] rights for the BBC’s library of factual landmark series and specials, a marvel like library for the factual and natural history genre,” Zaslav said. “Our ambition is to take that library along with the best of the Discovery Channel, Animal Planet and Science libraries, together with additional exclusive original content […] in the genres of natural history, science, adventure, exploration, history, space and technology, and package it together into the definitive natural history and factual streaming platform in the world and take that above the globe.”