Charter Communications is taking a hard line against extending promotional pricing for Time Warner Cable and Bright House Networks customers and Wall Street predicts a major exodus of customers as a result.

UBS analyst John Hodulik predicts Charter’s new ‘Just Say No to Discounts’-attitude will result in customers saying ‘Cancel’ and he estimates a massive loss of at least 75,000 Time Warner Cable television customers in the third quarter as a result, with many more to follow.

Charter Communications’ executives have ordered a hard line against giving existing customers discounts and perpetually renewing promotional pricing, a practice Time Warner Cable has continued since the days of the Great Recession to keep customers happy.

Time Warner Cable and to a lesser extent Bright House have learned antagonized, price-sensitive customers were increasingly serious about cutting cable’s TV cord for good when the cost becomes too high to justify. Time Warner Cable dealt with this problem by giving complaining customers better deals, often repeatedly. That mitigated the problem of customer loss, allowed the company to retain and grow cable television customers and even helped minimize the practice of promotion shopping common in competitive service areas.

For years, Time Warner and Bright House customers learned they could enroll in a year-long promotion with the cable operator and then switch to a year-long new customer promotion from AT&T U-verse or Verizon FiOS and then jump back to the cable company with a new promotion. In many cases, they even got a gift card worth up to $300 for their trouble. Charter Communications thinks their new “pro-consumer policies” of not charging rapacious equipment fees and sticking to “simplified” prices will delight customers enough to keep their loyalty. Good luck.

Licensed to print money

Wall Street doesn’t believe Charter’s reputation or their ‘New Deal’ for TWC and BH customers will be perceived as making things better, especially for cable television and its cost. As customers roll off promotions at Time Warner Cable, the bill shock of watching rates rise up to $65 a month will speak for itself. The higher the price hike, the more likely it will provoke a family discussion about dropping cable television service for good.

In Los Angeles and Texas, where Charter premiered its new “simplified pricing” for Time Warner Cable customers, the response has been underwhelming, with many customers deriding it as “simply a price hike.”

David Lazarus, a reporter for the Los Angeles Times, characterized the transition from TWC to Charter this way: “Meet the new cable company. Same as the old cable company.”

Culver City resident Jack Cohen provides good evidence of what happens when customers get their first bill from Charter, and it is higher than expected. Cohen received his first bill for $162, $22 more than his last Time Warner Cable bill of $140 a month, because his promotion with TWC expired. As a result, he canceled cable television after Charter wouldn’t budge on pricing. Cohen said “cancel” and never looked back. He now pays the new cable company $40 less than he gave Time Warner Cable, because he now only subscribes to broadband and phone service. Charter’s ‘simplified pricing’ cost the cable company more than the $22 extra they were originally seeking.

Lazarus learned when his own TWC promotional package expires in December, Charter had a great Christmas present waiting… for themselves. Lazarus’ $65 promotion will rise to $120 a month — almost double what he used to pay. But Charter also offered Lazarus a better deal he can refuse, a new Charter-Spectrum package of the same services for the low, low price of $85 a month — still a 30% rate hike.

In Texas, customers coming off promotions are learning first hand how Charter intends to motivate customers to abandon the Time Warner Cable packages Charter promised they could keep — by making them as unaffordable as possible and offering slightly less expensive Charter/Spectrum packages as an alternative.

“But it’s still $45 more than what I was paying Time Warner Cable for the same damn thing,” complained Ty Rogers to a Charter retention specialist, after his Time Warner Cable shot up once Charter took over. He is waiting for Google Fiber to arrive and then plans to cancel everything with Charter.

Charter’s billing practices also are dubbed the weirdest in the cable industry by The Consumerist, because Charter loves to hide taxes, surcharges, and fees by rolling them into other charges on the bill and cannot be accurately accounted for:

Charter breaks out federal, state, or local taxes and fees for some services (TV) but not for others (voice). Also, depending where you live and when you signed up for services, the taxes, fees, and surcharges that do appear may be listed under different sections of the bill or not at all.

While their procedure does result in many fewer line items for consumers, it does produce more confusing bills overall, and make it harder to compare against other providers in a truly apples-to-apples kind of way.

‘No, no, no,’ counters Charter/Spectrum to FierceCable.

“Our internet packages are competitively priced, but we offer faster starting speeds and don’t charge an additional modem lease fee on top of the cost of service (that is an additional $10 at legacy TWC),” Charter spokesman Justin Venech said. “That pricing is better and more attractive to customers. Our video packages are simpler and more robust. For example, our Spectrum Silver package includes over 175 channels plus premium channels HBO, Showtime and Cinemax while a comparable TWC package would have charged extra for premiums.  We don’t add on additional fees and taxes to our voice product that our competitors do, and our equipment pricing for video set-top boxes are much lower with Spectrum than our competitors or legacy TWC or BHN.  Our new Spectrum pricing is $4.99 for a receiver vs over $11 at legacy TWC.”

“That assumes, like every cable company always does, that we want HBO, Showtime, and Cinemax, don’t already own our own cable modem, and are not dancing in the streets over an even bigger television package filled with crap we don’t want,” said Rogers. “Charter also takes away Time Warner’s excellent long distance phone service, which let me call almost all of Europe without any toll charges or an extra cost calling package. I paid Time Warner $10 a month and could talk to someone in France all night long if I wanted. With Charter, it’s more for less.”

Rogers’ promotion included his DVR in the promotion, so comparing Charter’s $4.99 vs. TWC’s $11 for a DVR made no difference to him either.

“You can argue all day about the ‘value’ you are offering, but you can’t argue your way out of a bill that is $45 higher than last month,” Rogers complained.

Overall, the latest spate of cable mergers and AT&T’s acquisition of DirecTV has been bad news for consumers, who face fewer competitive prospects and a new, harder line on promotional pricing. AT&T customers are discovering AT&T is more motivated to get U-verse TV customers to switch to DirecTV and less interested in providing discounts. The cable competition knows that, making fighting for a better deal much tougher if Charter’s only competitor in an area is AT&T. Cable operators also understand there is a built-in reluctance to switch to satellite by a significant percentage of their customers.

Charter’s pre-existing customers not a part of the TWC/BH merger are not too happy with Charter’s Spectrum offers either. At least 152,000 video customers said goodbye for good to the cable operator’s television packages.

Hodulik predicts there are more where that came from as the rest of the country gradually discovers what Charter has in store for them.

While cable operators continue to deny cord cutting is real, their marketing departments think otherwise and are responding with slimmed down cable TV packages showcasing premium movie channels at a non-premium price.

This week, Time Warner Cable began offering a $10 add-on video package of over-the-air major network stations for new customers in Manhattan signing up for 50/5Mbps broadband service ($39.95 a month alone on a one year promotion in TWC Maxx markets). Oh did we forget to mention that $10 also includes both HBO and Showtime — the same networks Time Warner sells to everyone else for about $16.95 a month each?

At $10 a month, the package is a steal if you are still interested in local live/linear TV and movie channels. XFINITY Stream for Comcast is comparable, but Comcast extracts $15.99 a month for almost the same thing.

Time Warner Cable is obviously targeting disinterested Millennials that might otherwise skip television or consider the $20 Sling TV package instead.

But the cable company is downplaying the package and its price.

Time Warner Cable CEO Rob Marcus likes to remind investors at least 80 percent of Time Warner customers still subscribe to the big 200+ channel cable TV package, and Time Warner has hardly been a pioneer of “skinny bundles” that cut down the TV package to just the essentials.

Despite those assertions, the number of Americans willing to drop cable television continues to increase… and fast. Convergence Consulting notes the industry lost 283,000 video customers in 2014 and 1.1 million in 2015 — a four-fold increase. Convergence estimated at least another 1.1 million will cut the cable TV cord this year in what could become “the new normal.”

Video consumers are turning instead to on-demand, online viewing, which can provide commercial-free and binge viewing opportunities. Both Millennials and Generation X viewers are trending towards shows, not channels and networks, and many would never know (and fewer still care) what channel they were watching without the identity bug perpetually attached to the lower right of the screen.

Eventually, cable television service will likely occupy a part of a fat IP-pipe free-for-all, where viewers can still watch linear programming if they wish, but are more likely going to customize a much more personal viewing experience online instead.

Attempts by CBS to get consumers to pay the network $5.99 a month to stream ad-filled network shows, classics, and local affiliates has proven less compelling than the network originally thought.

CBS chairman and CEO Les Moonves admitted to investors “All-Access” has not met the company’s expectations, even after CBS added options to watch several of its network affiliates around the country.

Speaking at the Deutsche Bank Technology, Media & Telecom conference in Palm Beach, Fla., Moonves said CBS was considering discounting the service, especially if customers bundle it with Showtime’s standalone online video service, now priced at $10.99 a month.

Moonves

Instead of relying entirely on other companies to create so-called “skinny bundles” of pared down video packages offered as an alternative of one-size-fits-all cable TV, CBS has kept some of its online video offerings in-house under the All-Access brand, which launched in October 2014.

But convincing the public to pay $6 a month for ad-laced shows is proving as much of a challenge for CBS as it had been for Hulu’s Plus option. Moonves suggested CBS is considering adding a premium ad-free option like the one Hulu offers now, for an additional $4 a month, and is also trying to get the National Football League to allow NFL game streams on All-Access in the future.

CBS’ best chance of success for its subscription service may come from offering original shows exclusively to subscribers, particularly a new Star Trek series premiering in January. Moonves predicted that would help make All-Access an “extraordinary success.”

“Next year it’s going to add substantially to our bottom line,” he added.

Moonves called cord-cutting “inevitable,” as consumers gravitate away from traditional cable television packages.

“Someone is going to figure out how to do this and how to give people what they want […] and not for $100 a month,” Moonves said. “It will [sell] for $35-39 dollars a month [and] you’ll get the 12 to 15 or 18 channels that you care about, and not the Karate Channel for 25¢ a month. That doesn’t make sense anymore.”

Building in protection from cord-cutting, AT&T today announced it was bringing back its unlimited data wireless plan for customers that subscribe to U-verse TV or DirecTV.

The new AT&T Unlimited Plan claims to offer unlimited data, talk and text for $100 a month. Additional smartphones are $40 per month each, with a fourth smartphone free to add at no extra charge.

“Video traffic continues to grow on our network as fast as ever because people enjoy viewing their favorite video content on their favorite devices,” said Ralph de la Vega, CEO of AT&T Mobile and Business Solutions. “And, they will get a high-quality video streaming experience from the start. No compromises in video quality.”

Except that AT&T discloses in its fine print, “After 22GB of data usage on a line in a bill cycle, for the remainder of the bill cycle AT&T may slow data speeds on that line during periods of network congestion.”

Speed throttles often affect video quality and can stall playback.

It’s the first time in five years AT&T has offered an “unlimited data” wireless option to its mobile customers. Analysts suspect the offer is designed to compete with T-Mobile’s free video streaming “BingeOn” promotion, while also protecting AT&T’s video platforms from cord-cutting. AT&T also gets an opportunity to add new video customers to its recently acquired DirecTV service, because only customers with a qualifying video subscription are allowed to buy the unlimited data plan.

AT&T is tying the unlimited data promotion to its satellite offering DirecTV, not U-verse, with a promotional satellite TV package for new video customers beginning at $19.99 per month for 12 months, with a 24 month agreement. After one year, the base TV package increases to $49.99 a month.

To bring back AT&T wireless customers that left for another carrier, AT&T is offering up to $500 in incentives when customers switch to the AT&T Unlimited Plan with an eligible trade-in and buy a new smartphone on AT&T Next. Customers who combine their U-verse or DirecTV account with AT&T Wireless on a single bill will also get an extra $10 off per month.

AT&T is effectively selling its Unlimited Plan for $60 a month, double AT&T’s original rate for unlimited data of just under $30. With a video subscription pre-qualifier, customers enrolling in the plan can expect a substantial bill.

On the mobile side, customers will be initially expected to pay up to $220 a month for four active lines. The $40 credit for the fourth smartphone only begins after two billing cycles, finally reducing the bill to $180 a month before taxes and surcharges. A required video package will range from $19.99 for a basic DirecTV plan ($49.99 in year two) to as much as $80 or more for U-verse TV, bringing a combined television and wireless bill to more than $300 a month.

Those with 4G tablets can save some money dropping the $40 unlimited data device access fee and choosing a $10 1GB data plan for tablets instead.

Comcast is inviting controversy launching a new live streaming TV service targeting cord-cutters while exempting it from its own data caps.

Comcast’s Stream TV is comparable to Comcast’s Limited Basic lineup, only instead of using a set-top box, Stream TV delivers online video over the Internet to Comcast’s broadband customers in Massachusetts, New Hampshire, Maine and the Greater Chicago area. For $15 a month, Stream TV offers a large package of local over the air stations, broadcast networks, and HBO, along with thousands of on-demand titles and cloud DVR storage. In Boston, the lineup includes:

WGBH (PBS), HSN. WBZ (CBS), NECN, WHDH (NBC), Community Programming, BNN-Public Access, WWDP-Evine Live, WLVI (CW), WSBK (MyTV), WGBX (PBS), WBIN (Ind.), WBPX (Ion), WMFP (Ind.), The Municipal Channel, Government Access, WFXT (FOX), WCEA (MasTV), WUNI (Univision), EWTN, C-SPAN, CatholicTV, POP, QVC, WYDN (Daystar), WUTF (UniMas), WNEU (Telemundo), Jewelry TV, XFINITY Latino, WGBH World, WGBH Kids, Trinity Broadcasting Network, WGBH Create, Leased Access, WBIN-Antenna TV, WBIN-GRIT TV, WNEU-Exitos, WLVI-BUZZR, WCVB (Me-TV), WFXT-MOVIES!, WHDH-This TV, WFXZ-CA, WUNI-LATV, WFXZ (Mundo Fox), WBZ-Decades, and WFXT-Laff TV + HBO. The package also qualifies the customer as an authenticated cable TV subscriber, making them eligible to view TV Everywhere services from many cable networks.

Comcast is offering the first month of Stream TV for free with no commitment to its broadband customers subscribed to at least XFINITY Performance Internet (or above). Up to two simultaneous streams are allowed per account and some channels may not be available for viewing outside of the home. Comcast claims it will expand Stream TV to Comcast customers nationwide in 2016. Comcast will not be selling the service to customers of other cable or phone companies, limiting its potential competitive impact.

Competitors like Sling TV offer their own alternatives to bloated cable TV subscriptions at a similar lower price, and they will sell to anyone with a broadband connection. Sling alone is partly responsible for Comcast’s loss of hundreds of thousands of cable TV customers who don’t want to pay for hundreds of channels many never watch. That Comcast might want to launch its own alternative online video package to retain customers is not a surprise. But Comcast’s decision to exempt Stream TV from the company’s data caps while leaving them in place for competitors is sure to spark a firestorm of controversy.

Comcast claims it is reasonable to exempt Stream TV from its 300GB data cap being tested in a growing number of markets.

“Stream TV is a cable streaming service delivered over Comcast’s cable system, not over the Internet,” wrote Comcast in its FAQ. “Therefore, Stream TV data usage will not be counted towards your Xfinity Internet monthly data usage.”

More precisely, Comcast claims it relies on its own internal IP network to distribute Stream TV, not the external Internet competitors use to reach ex-Comcast cable TV subscribers. Comcast’s premise is it is less costly to deliver content over its own network while Internet traffic comes at a premium. Critics will argue Comcast has found an end run around Net Neutrality by relying on usage caps to influence customer behavior.

For the moment, Netflix is reserving comment after being contacted by Ars Technica. But Sling TV and other services that depend on Comcast’s broadband to reach customers will likely not remain silent for long.

Comcast could effectively deter consumers from using competing online video services with the threat of overlimit fees if customers exceed their usage allowance. The cable company could even use the fact its services don’t count against that allowance as a marketing strategy.

Stop the Cap! has warned our members about that prospect for years. Preferential treatment of certain content over others by playing games with usage caps and overlimit fees could have a major impact on emerging online video competition. Since Comcast owns both the broadband lines and the online video service, it can engage in anti-competitive price discrimination. Competitors will also argue that Comcast’s internal IP network is off-limits to them, making it impossible to deliver content on equal terms over a level playing field.

The next move will likely come from the FCC in response to complaints from Comcast’s competitors. As Ars Technica notes, the Federal Communications Commission’s Net Neutrality rules allow for complaints against so-called zero-rating schemes, with the commission judging on a case-by-case basis whether a practice “unreasonably interferes” with the ability of consumers to reach content or the ability of content providers to reach consumers.

With Comcast’s usage caps and overlimit fees, the only reaching will be for your wallet. Consumers need not wait for Sling TV and others to complain to the FCC. You can also share your own views about Comcast’s usage caps by filing a complaint with the FCC here.