Your bundle is bigger than ever.

A-la-carte TV is still dead. Long live the super-sized bundle!

If AT&T and Time Warner wanted to deliver a message to the cable industry as a result of their now-approved blockbuster merger deal, it is one that promises hundreds, if not thousands of more TV channels, movies and shows headed your way in the coming days, bundled into super-sized pricier packages of television, telephone, and internet service.

Despite the fact consumers claim they want to pick and pay only for the entertainment options they specifically want, in reality people are paying for more bundled packages and services — usually from multiple online streaming services — than ever before, with no possibility they will ever watch everything these services have to offer.

AT&T and Time Warner are well aware customers are now subscribing to cable television -and- streaming video services like Hulu and Netflix. But many customers are also buying streaming live cable TV alternatives, despite the fact they already subscribe to a cable television package. Given the option of selling you an inexpensive package of a dozen cable channels you claim to want or selling you much larger and more expensive bundles of services many are actually buying, AT&T will follow the money every time.

What will be different as a result of this merger is where you buy that programming. Before, you may have purchased AT&T Fiber internet access, AT&T wireless mobile phone service, a HBO GO subscription through DirecTV Now, a cable TV alternative, and Netflix. Now, with the exception of Netflix, all of that money will go directly to AT&T. The company will also be able to enhance their bottom line by monetizing content viewed over mobile devices. After taking control of Time Warner’s vast entertainment offerings, which range from HBO to Turner Broadcasting networks like CNN and TNT, AT&T will generously bestow liberal (or possibly free) access to this content for its broadband and wireless customers, while those served by other providers will have to pay up to watch. AT&T will ultimately set the terms of its licensing agreements. AT&T Wireless customers with unlimited data plans already have a sample of this with a free year of DirecTV Now, which customers of other wireless companies have to pay to watch.

AT&T plans to offer the best deals to customers who bundle everything through AT&T. The “quad play” bundle of TV, internet, home phone, and wireless phone will offer customers discounts on each element of the package, but some may experience sticker shock even with the discounts.

The Wall Street Journal noted a premium AT&T customer could pay more than $500 a month for AT&T’s best package — that’s more than $6,000 a year. Most bundled AT&T customers will pay about half that — around $246 a month for a package of 100 Mbps internet, a home phone line, wireless phone and a limited TV package bundling Time Warner content, including HBO. The entry level ‘poverty’ package will still cost around $115 a month.

By controlling each element of the package, AT&T can discourage a-la-carte package pickers by substantially raising the price of standalone services, to encourage bundling. That explains why many customers take a promotional TV offer priced just $10-20 more than the $70 broadband-only package some customers start with. If broadband-only service costs $40 a month and the TV package also costs $40 a month, those leaning towards cord-cutting would find it much easier to pass on cable television.

With Comcast on the verge of picking up much of 21st Century Fox’s content library and studio, Comcast will be able to defend its own turf creating similar giant bundles of content to keep its customers happy. Wall Street is already putting pressure on Verizon to respond with an acquisition of its own to protect its base of FiOS and Verizon Wireless customers.

Companies likely left out in the cold of the next wave of media and entertainment consolidation include online content companies like Google, Facebook, Amazon, and Apple, which will be stuck licensing someone else’s content or bankrolling many more original productions. Charter Communications, which has a small deal with AMC for content, is also stranded, as are smaller cable companies like Cox, Altice, and Mediacom. Independent phone companies like CenturyLink, Windstream, Consolidated, and Frontier are also in a bad position if Wall Street determines telecom companies without content divisions are in serious trouble.

Netflix stands alone as the behemoth content company, and is not likely to be impacted by the current wave of consolidation. Hulu will most likely end up in the hands of a telephone or cable company, most likely Comcast, if it successfully acquires Fox’s ownership share of Hulu.

For customers, your future choice of provider is about to get more complicated. In addition to pondering speed tiers and wireless coverage maps, you will also have to decide what content packages are the most valuable. Your choices will range from basic company-owned networks to third-party services like Netflix and Hulu, as well as full cable TV lineups ranging from DirecTV Now to XFINITY TV. Then get ready for the bill, which will likely include charges for most, if not all, of these services.

The Wall Street Journal explains the current wave of media consolidation. (2:44)

Charter Communications has introduced internet-delivered cable television packages that its cable TV subscribers have requested for years, including one offering a true a-la-carte lineup of network TV channels and the customer’s choice of 10 cable channels for $25 a month.

Spectrum Choice was soft-launched this week and is a companion to a larger internet-delivered package of TV services targeting cord-cutters called Spectrum Stream, which is also available in many areas.

Although Spectrum customers can visit the order page to sign up for Spectrum Choice immediately, when we tested it this afternoon we found the website was not able to complete an order. It turns out Spectrum is initially “hand-selecting” about 100,000 customers in selected areas for Spectrum Choice, but won’t disclose exactly where those areas are. We know from some reviews, it is available in parts of Ohio.

For now, would-be customers can try building their own package from at least 65 cable networks, including several networks Spectrum usually bundles into higher cost Silver and Gold packages. For example, Turner Classic Movies, Hallmark Movies and Mysteries, and FX Movie Channel are all available to choose. Spectrum Choice also offers all three major cable news networks as well as Spectrum News (where available). ESPN, ESPN II, FOX Sports, NBC Sports Network, and NFL Network are also available for sports fans. Even Music Choice is included.

Spectrum Choice customers are not tied down with a bloated package of channels, except for the included large bundle of local stations, which includes ABC, CBS, NBC, FOX, CW, MyNetworkTV, PBS, and independent/foreign language over the air stations. The availability of public television is a rarity among online cable TV alternatives. In most areas, digital subchannels like Grit and MeTV are also included, depending on what networks are provided by stations in your area. You will also get several shopping channels, C-SPAN I, II, and III, and local Public, Educational, and Government Access channels as seen on your local cable system.

If you visit their website can complete an order online, you are qualified to receive their service. If there is no option to move forward to complete an order, you are not qualified to sign up at this time, but check back later or call Spectrum and ask.

The service relies on the Spectrum TV app (available on iOS, Android, Roku, and Xbox One) and the Spectrum website to stream video programming to customers, and no set-top box is required. DVR service is not worth the effort or cost. It requires a traditional DVR set top box and you can only watch recorded shows on the television connected to the DVR. Be aware there are also restrictions viewing some channels outside of the home, just as Spectrum’s cable TV customers already understand:

Linear OOH: Watching a live channel while away from home
VOD OOH: Watching on-demand content while away from home
TVE App Name: TV Everywhere App Name – Independent apps used by programmers or viewing on their websites
VOD Parity: Cable TV and Spectrum Choice customers get access to the same on-demand programming options.

Details (click the name of the package for more information):

Spectrum Choice TV

If you don’t mind Charter/Spectrum choosing your channel lineup, a second option offers more channels for about the same price.

• 7-day money back guarantee/trial, then $15 for the first month
• To get the service, you must have an internet-only plan or an internet + voice plan from Spectrum. You cannot be a current traditional cable TV subscriber
• After the first month, the service costs $25 per month for the first two years, including the Broadcast TV Surcharge, but excluding tax
• After 24 months, price increases to $30 a month
• Your assigned Spectrum TV username and password will also work on websites that authenticate you as a qualified cable TV customer
• Premium channels are $7.50 each for HBO, Showtime, The Movie Channel, Starz, and Starz Encore or bundle all-five for $15 a month for two years. Epix is also available a-la-carte.

Spectrum Stream TV

• $21.99 a month (not including $3 Broadcast TV Surcharge) for 25+ pre-selected channels including local stations and major basic cable networks
• All features included with Choice TV work similarly except the lineup is not a-la-carte. But you may get more channels at a comparable price.
• After two years, the price increases to $26.99. Starting in year three, the price rises again to $34.99.
• The same $15 promotion for five premium movie networks noted above applies, if interested.

Spectrum’s promotion of Stream TV. (1:00)

Spectrum cable subscribers still watching cable television without a set-top box will soon need one, or a functional equivalent, for every television connected in their home or business as Charter Communications continues its effort to encrypt all cable channels.

The campaign has now reached Kentucky, where Spectrum is preparing to encrypt every television channel on the lineup and is sending notices to its residential and commercial customers.

The University of Kentucky is working to get the word out to facilities operated by UK they may lose all television service as early as July 11 if they don’t take action.

Encryption forces customers to use set-top boxes or other equipment, often at an additional expense, to continue watching cable television service. Cable companies use encryption to reduce signal theft and eliminate the need to send trucks to disconnect customers at the pole. Instead, Charter will simply deauthorize a customer’s set-top box or other equipment so they can no longer watch when the customer cancels or does not pay their bill.

Charter Communications has begun forcing some former Time Warner Cable customers into new Spectrum packages and pricing without their permission, causing customers to lose channels, pay higher prices, and have to exchange working cable boxes at a cost of up to $24.

The cable operator has begun “sweeping” accounts looking for customers it deems to have paid too little for too long or who are getting grandfathered cable channels the company feels they are no longer entitled to receive.

One of the first cities to be hit with Charter CEO Thomas Rutledge’s ‘account sweeps for more cash’ initiative is Lexington, Ky., where longtime customers are discovering their cable service is missing more than a dozen channels with no warning or explanation.

Daniel Fitzgerald discovered many of his cable channels were gone, replaced with a message that his subscription no longer included the cable channels that had been a part of his Standard cable package for years.

“I thought, ‘What the hell? I just paid the cable bill,’” Fitzgerald told the Herald-Leader last week at his tiny Lexington apartment he shares with his disabled 16-year-old son.

It turns out he wasn’t paying enough to satisfy Charter Communications.

A Spectrum representative told Fitzgerald that he hadn’t been paying Time Warner enough for the standard cable package. If he wanted those channels back, his monthly bill for cable and internet would jump $36 a month, from $103 to $139, effective immediately. No new channels, no new features, just a new much higher bill. To add insult to injury, the representative didn’t much care for the cable box Time Warner Cable provided him several years earlier and demanded its replacement, for a $24 service fee to send a technician out to check his service and replace his equipment.

When Fitzgerald attempted to negotiate with the cable company that claims it’s a “new day” for how cable companies treat their customers, the representative promptly cut him off.

‘This is Spectrum’s deal, take it or leave it,’ he was told.

“It was bull crap,” Fitzgerald said. “They don’t give us any notice, they just spring it on us in the middle of the month. And then they tell us we’re getting an ‘upgrade.’ This isn’t an upgrade, it’s the same channels we already had!”

Fitzgerald was not the only customer affected with Charter’s “surprise ‘upgrade,'” according to Lexington city officials, whose phones have rung off the hook about cable channels being held ransom for steep rate increases.

City officials who called on Spectrum to explain themselves eventually heard back from the cable company in a terse e-mail claiming Charter has begun performing “sweeps of customer accounts” looking for customers who have got too good of a deal from the cable company. Those customers are then summarily “repackaged” with no warning. Charter was busy “repackaging” a lot of Fitzgerald’s neighbors in his Alexandria Drive apartment building as well.

Rutledge told Wall Street investors this quarter it was all a part of Charter’s commitment to “move prices in the right direction.”

At Ximena McCollum’s home in Lexington, Charter cut off the NCAA men’s basketball tournament in-progress. When McCollum called Spectrum, she was informed she was “repackaged” as well, and could get her basketball game back for the right price: $45 more every month.

The customer service representative told her the channels she claimed she was getting were no longer part of her subscription.

“So if I had been getting them, I shouldn’t have been getting them,” McCollum said last week. “I told her that I’ve lived in this house for seven years. I’ve always had the same channels. She kept insisting that I wasn’t supposed to be getting these channels unless I paid them some ridiculous price. You could tell that she was confused and reading from some sort of script they had given her. Finally, I said, ‘Just cancel my subscription. I cut the cord.”

The Herald-Leader reported the “repackaging” comes down to one issue: money. Charter wants more, a lot more in some cases.

Rutledge has repeatedly claimed Time Warner Cable was effectively giving away the store and kowtowing to appease customers with lower rates when they complained about their cable bill. As far as Rutledge is concerned, the iron hand of discipline for former Time Warner customers is long overdue.

Rutledge promised he will force higher cable prices this spring as the company starts driving customers out of the Time Warner Cable packages into more expensive Spectrum packages. The company does that by allowing bundled discounts and promotions to expire on existing Time Warner packages, which results in sometimes-shocking rate increases of $50 or more per month. When customers call to complain, they are pushed towards slimmed-down Spectrum TV packages that cost slightly more than what customers used to pay and include more than a dozen fewer cable channels.

No one is exempt from being herded into Spectrum’s vision for the future. Even some of the city government’s office televisions have gone dark after “repackaging.”

Mossotti

City councilwoman Jennifer Mossotti got the Spectrum treatment as well, told if she wanted to keep her cable service, she needed to pay $21.50 more a month. Mossotti assumed she could whittle that amount down by dropping her Time Warner Cable phone service, but Spectrum told her that would cost her even more because it would break up her triple play bundle, resulting in an even bigger rate hike.

Lexington officials claim they feel held hostage by Charter and the ransom the city and its citizens have to pay doesn’t get them better service, just the same service they used to have for more money.

“It’s frustrating to the Nth degree. People are calling our offices daily about this,” Mossotti told the newspaper. “We felt like we at least had a little leverage with Time Warner. You could talk to them and usually you could work something out. With Spectrum, everything falls on deaf ears.”

In the face of the public relations disaster this is causing Charter in Kentucky, company representatives are trying to shift the blame on to customers, claiming they have been freeloading channels that have been part of legacy cable packages from years earlier that were either grandfathered or long forgotten, and Charter is simply tidying up.

For example, a local man who lives on Social Security benefits and who received the same cable lineup for 20 years “has only been paying for the Starter TV package,” Jason Keller, Charter’s senior director of government affairs, told city officials in an April 10 email. “The most recent sweep of customer accounts is what knocked out the channels, since he wasn’t paying for them. However, we’ve now repackaged him into a new service offering that has restored the channels and provides him with a new HD box.”

Keller did not respond to calls from the Herald-Leader asking how many Lexington customers now face higher cable prices.

In a prepared statement, Charter spokesman Michael Pedelty wrote: “Time Warner Cable was providing some programming inadvertently to a small number of customers whose packages didn’t include them. We want our customers to have the best quality and most reliable video experience. Earlier this year, we started a network project that adds an element of security and ensures individual channels are encrypted and available exclusively to those who subscribe to them.”

A few Lexington area residents told Stop the Cap! they felt abused by the entire process.

Barbara Montgomery, a subscriber of Charter (and two of its predecessors) claims she faced a higher bill after many of her channels disappeared a few weeks ago.

“We were ‘repackaged’ and told it would cost us $34 to get channels back,” Montgomery told us. “The [Charter] guy literally told us ‘tough luck, honey!'”

Edgar, who withheld his last name, reported that a Charter representative came close to accusing him of being a cable thief for getting channels he was not supposed to receive.

“I had this cable package for 27 years, no less and no more, and the last two companies – Insight and Time Warner Cable – let me keep paying for it year after year and I never saw any reason to change it,” he told us. “But Charter did, and on their own. One day the channels were there, the next day they were not. They tell you it’s too bad but that is way things are with Spectrum and they keep telling me their internet service is better, but I am 92 years old and don’t even have a computer.”

The experience of customers in Lexington may explain why tens of thousands of former Time Warner Cable customers are dropping Spectrum like a hot rock when the rate increase hits. For Rutledge, who was rewarded with a $98.5 million pay package in 2016, charging current customers a lot more for cable service more than makes up for the former subscribers they manage to drive off. For him, customers either get with the Spectrum program or they can go somewhere else, if there is somewhere else for customers to go.

From: Charter Communications’ 1Q 2017 investor presentation

Those experiencing the Spectrum Treatment are switching to AT&T U-verse, although AT&T is trying very hard to get them to sign up for DirecTV instead.

Montgomery tells us AT&T really doesn’t want their cable business, but they will sell her an expensive cell phone or satellite TV.

“AT&T is a happy hog making a lot of money in the cell phone business, but they sure don’t want to spend much on giving me TV service, and told me I’d be happier with satellite TV,” she said. “If I wanted satellite TV, I would have called DirecTV or Dish myself.”

The other option for parts of Lexington is Windstream’s Kinetic TV, a fiber to the neighborhood service available in some Windstream service areas. But Kinetic TV is getting mixed reviews from customers who have the service, and for those that want broadband, Kinetic speeds don’t cut it for many.

While Rutledge figures out how to spend his eye-popping compensation package, those on fixed incomes like Fitzgerald who live on less than $1,000 a month are trying to figure out where they will get the extra money to pay Charter.

Fitzgerald was giving the cable company $103 a month for standard cable television with no premiums and internet service. Now Spectrum wants 35% more for the same service he used to get.

A nearby neighbor told Fitzgerald and the newspaper their Spectrum bill went up $18 a month.

“A five dollar increase, OK, fine, I guess I could deal with that,” the neighbor said. “But twenty bucks just because a new company comes in? This is felonious. What am I gonna do, tell Social Security that I need $20 more every month because Spectrum wants it? It doesn’t work that way.”

“There ain’t much you can do about it, though,” Fitzgerald told the neighbor. “They’re the cable company.”

Comcast’s NBCUniversal is laying plans to introduce a premium online video service highlighting NBC Network content and possibly various programming from the various cable channels owned by Comcast.

After watching rival CBS amass more than 1.5 million subscribers for its “All Access Pass” ($5.99, $9.99/mo for commercial-free option), Comcast’s NBC entertainment division isn’t willing to leave money on the table any longer.

The yet unnamed service is expected to compete with services like Hulu and Netflix, but will most likely be comparable to CBS’ premium subscription offering. In addition to featuring a deep library of NBC content, the service could include a significant catalog of past and present shows from cable networks like Bravo, SyFy and USA. Also to be determined is whether NBC will follow CBS’ lead and offer viewers live streaming of their local NBC station as part of the package.

The new service may not launch in the immediate future because Comcast is still observing restrictions imposed by regulators as a condition of its 2011 acquisition of NBCUniversal. The rules make it difficult for Comcast to develop services comprised entirely of content it owns or controls. Federal regulators added the restriction out of concern Comcast could interfere with Hulu’s access to NBC content. Hulu is popular with cord-cutters, and is seen as a viable alternative to cable television. The last of these restrictions expire in September 2018, about the time Bloomberg News reports Comcast is likely to launch the service.

If all the major American networks decide to develop their own premium streaming services, it could have significant implications for Hulu, which combines content from its partners NBC, ABC, and FOX. If NBC pulls out of the partnership, it will be free to keep all the revenue earned from its own streaming platform, and could inspire ABC and FOX to follow.

Observers suspect this represents more evidence that broadcast networks increasingly expect viewers to pay for access to their programming, at least online.