After Comcast Rolls Out a Great New Cable Plan, Time Warner Follows Suit. Sort Of.

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Cable boxes are stacked before being stored at the Time Warn
Andrew Harrer/Bloomberg via Getty Images
They say that imitation is the sincerest form of flattery. So, Comcast (CMCSA), consider yourself flattered, because Time Warner Cable (TWC) is copying off your homework.

A couple of weeks ago, we told you about Comcast's "Great New Secret Cable Plan" to try to halt the exodus of subscribers from its services. The Comcast plan allows subscribers to sign up for:
  • A menu of 45 or so of the most-watched, most useful cable channels
  • The premium pay-TV channel HBO -- plus included HBO GO service for mobile devices
  • High-speed Internet access at speeds up to 25 Mbps
  • A subscription to XFINITY Streampix, Comcast's service for streaming video of complete seasons of popular television shows from recent years past...
... all for the low, low price of just $40 or $50 a month (depending on location).

The plan was "secret" because Comcast didn't make much of an effort -- or really any effort -- to publicize it. There's hardly even a mention of the plan on the company's website. In other words, it seems like Comcast would prefer to keep the new plan hush-hush so you continue paying for one of their more expensive bundles.

However, word of Comcast's under-the-radar new plan did get out -- nearly 5,500 DailyFinance readers printed, emailed, commented on, Tweeted, or Facebooked our story on Comcast's "Internet Plus" bundle last month.

So Comcast competitor Time Warner did what any good competitor does: It copied the model and, this week, began offering a similar plan of its own:



Dubbed "Starter TV with HBO," Time Warner's plan is an even more slimmed-down version of Comcast's idea. It features:
  • "20+" cable channels, including the five biggies -- ABC, CBS, NBC, Fox, and PBS
  • HBO and HBO GO
  • and... well, actually, that's about it.
At $30 a month, Time Warner handily undercuts Comcast's Internet Plus offer on price. And yet, it's hard not to wonder if customers aren't still overpaying.

For one thing, Time Warner's Starter TV with HBO offers only about half the channels included in Comcast's deal. Time Warner also doesn't include Streampix (which is a Comcast-only service). Most crucially, Time Warner's deal does not include Internet (although one imagines you can bundle it... at a cost, of course).

Adding the insult of surcharges to injury, Time Warner also includes a bit of fine print informing customers that the $30-a-month fee for the service (which is only guaranteed for 12 months. Did we mention that?) doesn't include the cost of equipment. Just renting a simple cable box will jack up the cost by more than $10 -- meaning it will cost as much as some customers are paying for Comcast Internet Plus, despite giving only about half the service.

So Long, Time Warner, We Hardly Knew Ye

One-third the size of Comcast (by annual revenues), Time Warner Cable has been losing customers at a rate 66 percent faster than its larger rival. Over the past couple of years, more than 1.13 million TWC customers cut the cord.

Like Comcast's plan, Time Warner's appears designed to stop the wave of customers defecting from cable to satellite TV providers DIRECTV (DTV) and DISH Network (DISH), and telcos AT&T (T) and Verizon (VZ), all of which have experienced net gains in subscribers over the past two years.

But Time Warner's "me-too" plan is a poor imitation of Comcast's gambit. It may look a little bit cheaper, but with the Starter TV with HBO plan, you really are getting only what you pay for.

And that's not much.

Motley Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool recommends DIRECTV.

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6 Comments

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GaryWNC

Come to Raleigh, NC COMCAST!!!!!!!!!!!!!!!!!!!!!!!!!!!

December 12 2013 at 9:33 PM Report abuse rate up rate down Reply
Gumby

I amnot sure but you probably ought to know that your cable inside your home installed long ago is obsolete due to outdated cable shielding coating inside the wall of the cable. If you have a HDTV, you need to replace all the cable inside your house with HDTV cable. The cable guy just stops outside your house and never tell you to replace your cable inside. You will probably think you are watching HDTV quality but you actually dont. Can you really count the lines on your HDTV? It is not easy. There is no tester to show that you are actually getting HDTV signals through your outdated cable inside your house. HDTV signals probably leaked thorugh your leaky cable. I am not sure but I know that there is different types of cables being sold and I see some cables that are made for HDTV while others not. So you better verfiy by calling your cable company to see if your cable is up to date for your HDTV.

December 10 2013 at 10:57 AM Report abuse rate up rate down Reply
musikhut

If we had Comcast in our area I'd seriously think about their new plan. I've got TWC now and am paying $80 a month for their cheapest cable package with high speed internet.

December 10 2013 at 10:11 AM Report abuse rate up rate down Reply
JIM

I CANCELED MOST OF MY WARNER CABLE AND I CAN'T FIND ANYTHING TO WATCH, BUT IT DOESN'T TAKE ME NEAR AS LONG TO FIND IT. I HAVE THOUSANDS OF DVDS AND VHS MOVIES SO I CAN WATCH MY OWN RERUNS FOR NOTHING.

December 10 2013 at 9:14 AM Report abuse rate up rate down Reply
1 reply to JIM's comment
Gumby

or you can try over the air antennas ... you get HDTV signals for free! Cable companies charge extra for HDTV signals or you just get EDTV which is same as old analog lines in digital . many people cant tell the difference between HdTV and eDTV on their own screens because they are too ignorant to tell any difference. CAble companies still charge you extra for HdTV that you dont get to your own screen sometimes... It is a real con!

December 10 2013 at 11:00 AM Report abuse rate up rate down Reply
balugablue21

and you can get most of this with an outdoor antenna

December 10 2013 at 7:45 AM Report abuse rate up rate down Reply