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Do cord cutters really want to recreate the cable bundle online? I don’t think so

October 28, 2020, 1:31 PM UTC

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“Get ready to un-cable, everybody,” T-Mobile CEO Mike Sievert says in a video announcing the carrier’s newest “Uncarrier” deal dubbed TVision.

America is pretty ready. The rate of cord-cutting has been accelerating throughout the pandemic and, depending on whose stats you use, one-quarter to one-third of households don’t pay for cable (or satellite) TV anymore.

The TVision service, which will be offered first to T-Mobile customers starting next month, is yet another cable replacement plan packaging a lot of the channels you know and making them available via the Internet. That’s not unlike Google’s YouTube TV, AT&T’s AT&T TV, DirecTV’s Sling TV, Disney’s Hulu Live TV, or the dearly departed Playstation Vue from Sony. But unlike the current offerings from most of those rivals, TVision is starting life with low prices and a bit more choice–three bundles ranging from $40 to $60 per month plus a $10 option with even more channels. The channels come wrapped in an appealing if simple app that can record shows DVR-style and run on mobile phones, tablets, or your TV via most online set-top boxes (though not Roku).

Some of the earlier rivals started with much the same approach. Remember way back in 2016 when AT&T debuted DirecTV Now with 100 cable channels for $35 a month? It quickly became various packages for up to $60, started losing customers in droves, and most recently morphed into AT&T TV starting at $60 and going up to $130 plus $8 a month extra for local sports. Hulu’s package once started at $40 but now costs $55 plus another $10 if you want DVR functionality. YouTube TV has also raised prices and now starts at $65.

The reason for the price hikes? Cable channel owners like Disney, ViacomCBS, and Fox are charging more for their programming. AT&T and Comcast got so sick of paying more that they spent billions to acquire Time Warner and NBCUniversal, respectively.

T-Mobile won’t have much control over programming prices; until it gains millions of subscribers it could eat some of those price hikes itself. T-Mobile execs were at pains to say TVision was more of an enticement to its current wireless customers than a new business opportunity. “Our strategy is not to make a ton of money in the TV space through TV profits,” chief marketing officer Matt Staneff told me yesterday. “Our strategy is to continue to use our scale and leverage to keep prices down for consumers.”

With the debut of TVision, there’s now a clear separation among the big three remaining wireless carriers. AT&T owns a lot of TV channels and content producers after buying Time Warner. T-Mobile made deals with producers (including AT&T) to create its package but doesn’t own any content. And Verizon stayed even further above the fray, simply offering YouTube TV to any of its customers looking for a cable replacement package at the usual $65 a month price.

Of course, if consumers keep moving away from cable—not just the cable cord but the whole concept of paying for bundles of channels—all three deals will look increasingly less appealing. Then it will be the carriers seeking to cut the cord, an easy move for T-Mobile and Verizon but a $109 billion entanglement for AT&T.

Aaron Pressman

@ampressman

aaron.pressman@fortune.com

NEWSWORTHY

Admittedly I did it subliminally. With antitrust regulators going after Google in part for its huge payments to Apple, Apple has quietly ramped up its own search activities, the Financial Times reports. Some search results in iOS 14 are provided by Apple instead of Google and sightings of the company's indexing web crawler, Applebot, have been on the upswing. Speaking of antitrust, the Justice Department is taking a hard look at Visa's $5 billion purchase of financial app plumbing provider Plaid, the Wall Street Journal reports. The probe was revealed when the DOJ went to court on Tuesday to force consultants at Bain & Co to comply with a subpoena for documents related to the deal.

Keep your hands off of my stack. Some companies are saying workers can go remote and never return to the office—but with lower pay if they move to cheaper locales. Reddit says it will grant the same flexibility but won't cut salaries. Huzzah!

Kojak with a Kodak. The strategy at Alphabet's Waymo self-driving unit has been to emphasize software and partner with others for the vehicles. On Tuesday, Waymo announced its latest deal, supplying autonomous driving capability for trucks that will be built by Daimler.

Stellar bits. New details have leaked about pricing for Elon Musk's satellite Internet service. Emails sent to potential customers for the initial Starlink service, dubbed the "Better Than Nothing" beta, promised download speeds of 50 to 150 Megabits per second for $99 per month (plus $500 for purchase of a required antenna and router).

Putting my life on my brink. In a nightmare scenario right out of Black Mirror, hackers stole personal patient records from a national chain of psychotherapy clinics in Finland and then sought to blackmail the patients. Records from about 300 patients of the Vastaamo chain have already appeared on the dark web.

Keep the champagne on ice. On Wall Street, Microsoft slightly disappointed with its forecast for the fourth quarter after reporting sales grew 12% to $37.2 billion last quarter. Its stock, up 35% this year, was down 2% in pre-market trading on Wednesday. It may have a lot further to fall, if hedge fund manager David Einhorn's view is correct. Tech stocks were in an "enormous" bubble that "has already popped" in recent weeks.

FOOD FOR THOUGHT

With social networks trying to avoid a repeat of 2016's spread of election misinformation, Twitter's general counsel, Vijaya Gadde, has been rising in influence. Politico's Nancy Scola has a long profile of the tech lawyer who's been advising CEO Jack Dorsey for almost a decade, including appearing with him on Joe Rogan's podcast last year.

In some ways, Gadde has been preparing for that kind of faceoff her whole life. Early on, says Gadde, she realized there were some ugly things about the world. Born in India and moving to Beaufort, Texas, when she was 2 years old, she recalls learning later that her out-of-work chemical-engineer father was advised by a boss to get permission from a local Ku Klux Klan leader to go door to door collecting insurance premiums. “My father literally went to the Grand Dragon’s house and had tea with him,” she has said, and learning that later, she told me, “shocked and terrified” her. Similarly formative, she says, was visiting the small village in India in which her father grew up, and seeing the treatment of women and other marginalized people: “It’s a terrible thing to feel like you don’t have choice, or a voice.”

IN CASE YOU MISSED IT

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International air travel might not recover before 2024, Raytheon CEO warns By Maria Aspan

Pfizer’s high-tech plan to track every dose of its experimental COVID vaccine By Sy Mukherjee

No, offices aren’t going away—but they won’t be the same By Jeff John Roberts

Bitcoin can’t help the unbanked, Mastercard CEO says By Aaron Pressman

Contactless payments and e-commerce got a big boost from the pandemic, says Visa’s Europe CEO By David Meyer

Why hasn’t Lyft moved into food delivery? By Lucinda Shen

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BEFORE YOU GO

With exactly one week left of the 2020 presidential campaign, and having already placed my vote, I must admit I'm sharply curbing my intake of political news. We'll hopefully know the outcome soon enough. Whatever happens next, we will have the benefit of a returning sage: Jon Stewart. The longtime host of Comedy Central's Daily Show has been off the air for five years. Now comes news that Stewart will start a new series focusing on current events to run on Apple TV+ next year. Can't wait.