Spectrum, the dominant cable company in Southern California, has woken up and smelled the cord-cutting coffee.
With little fanfare, the company has rolled out a new — and cheaper — a-la-carte streaming service intended to compete in an increasingly crowded marketplace with the likes of Sling TV, DirecTV Now and YouTube TV.
The new service, Spectrum TV Choice, looks at first glance like a viable option for those who have cut the cable cord.
But there’s a big catch: You have to be a Spectrum internet customer. Once all the costs are added up, it still might make more sense to stick with cable.
For anyone unfamiliar with streaming video, it’s a cool way to save a buck by paying less for fewer channels than available with the traditional cable bundle.
The channels arrive via the internet and are transmitted to your TV or mobile device via wireless routers and gizmos such as Roku players, Apple TV or Amazon Fire TV.
Sling TV, owned by satellite operator Dish Network, charges a base price of $20 a month for about 30 channels. DirecTV Now, owned by AT&T, charges $35 for more than 60 channels. YouTube TV costs $35 (rising to $40 in March) for more than 50 channels.
Similar services also are available from Hulu and PlayStation.
Spectrum TV Choice starts at $25 monthly (not including taxes). For that you’ll get the major broadcast networks, 25 music channels and 10 cable channels of your choosing from a list of 65.
Available channels include AMC, Cartoon Network, Comedy Central, CNN, Disney Channel, ESPN, FOX News, NFL Network, TCM and the Weather Channel.
Premium channels such as HBO, Showtime and Starz can be tacked on for just $7.50 apiece or $15 a month for a premium bundle.
Because there’s no cable box, there’s no DVR service, so you can’t record shows. You can add a box and DVR functionality for an extra $20 a month.
Spectrum is also offering a slightly different online service called TV Stream, which instead of allowing you to choose 10 favorite channels provides 25 channels of Spectrum’s own choosing.
“Spectrum TV Stream and Spectrum TV Choice are targeted at customers who don’t currently purchase a video product from us,” said Dennis Johnson, a company spokesman. “We continue to launch and test new services to better serve customer demand for more choice.”
Although Spectrum has been testing the new services in a handful of markets, I only learned about them by chance, while researching a related topic. Apparently they’ve been available in Southern California for weeks.
That makes you wonder why Spectrum isn’t aggressively marketing them — why the stealth approach? You can’t even find a video touting the services on Spectrum’s YouTube channel.
Johnson said only that to describe the TV Choice rollout as a stealth campaign “would be misleading and not accurate.” All appearances to the contrary notwithstanding.
I asked if I could take TV Choice out for a test drive. Johnson said Spectrum isn’t offering demos for media reviews.
I can only speculate that the company is worried a close look will reveal its streaming services aren’t very good deals.
Spectrum TV Choice is only available to Spectrum internet customers. All the rival streaming services will work with any internet service provider.
Spectrum’s broadband internet access will run you at least $65 a month. So factor in the $25 monthly TV Choice fee and you’re looking at a minimum $90 a month.
By comparison, you can sign up for the company’s Triple Play bundle — TV, phone and internet — for about the same price and not only get more telecom services but about 125 channels to boot.
Oh, and after your first two years of service, the monthly cost of Spectrum TV Choice will jump to $30 and then $38 (not including taxes) the year after that. With internet access, that will bring your total to more than $100.
Here’s the real stink bomb: You can only watch Spectrum’s streaming service if you’re on your Spectrum home internet network. If you’re elsewhere — Starbucks, say, or traveling — forget it.
The other streaming services are accessible anywhere you have an internet connection.
I asked Johnson why customers can’t access the TV Choice app on mobile devices outside their home. No comment.
It’s not hard to figure out, though. This is all about locking you in as an internet customer.
Basically, the deep thinkers at Charter Communications, which purchased Time Warner Cable a couple of years ago and renamed it Spectrum, know that all future revenue growth lies in broadband internet connections.
As of the fourth quarter of last year, Charter had 22.5 million internet customers, compared with 16.5 million TV subscribers. Cord cutting has played havoc with all cable companies as consumers increasingly turn to streaming for their video fixes.
So Spectrum TV Choice is first and foremost a way to entice people into becoming internet customers.
Maybe you’ll drop the Spectrum streaming service down the road and switch to, say, Sling, which offers more channels for less money (and can be viewed at Starbucks). All Spectrum really cares about is that you’re still on the hook for that $65 monthly home internet bill.
I’ll go out on a limb and predict that it’s just a matter of time before that internet fee tops $75 a month. And it will continue creeping toward $100.
That, needless to say, reflects the country’s pitiful lack of competition for broadband service.
The Federal Communications Commission reported this month that only 15% of U.S. households had two or three providers to choose from in obtaining broadband with a speed of at least 100 megabits per second, which is what Spectrum offers.
Forty-one percent of households had just one provider, and 44% had no service providers whatsoever at that speed.
For awhile, it looked like Google Fiber would be the answer. The tech heavyweight appeared determined to beat the you-know-what out of existing telecom players by rolling out super-fast, reasonably priced broadband connections nationwide.
After getting the fiber-optic service up and running in a handful of cities, though, Google’s expansion plans — including for Los Angeles — came to a halt amid cost overruns and disputes with utilities over accessing poles and pipes.
At this point, hopes for broadband competition rest with the prospect of wireless services. Last week, Elon Musk’s SpaceX launched two satellites to test the feasibility of low-cost, space-based internet access.
If it works, the idea is to eventually have thousands of satellites in orbit beaming wireless signals to the planet’s surface. However, we’re still years away from such a system becoming a reality.
So watch your step in the meantime. The number of streaming services is growing, and that’s a good thing.
But they’re not all created equal.