A couple of years ago, I did the math and determined that, if I were to purchase the entire season of every show I watch each year on iTunes, the cost would run me around $1000 per year, and that even includes purchasing shows that are freely available on Hulu, or the various network’s websites. Meanwhile, I pay $1500 a year for the privilege of fast-forwarding through commercials, while if I’d simply bought each season on iTunes, I could do without the commercials, and I’d get to keep those seasons, as well.
Still, I justify the $1500 expense because of sports programming, kids’ programming, and because I don’t like waiting until the next day (or the next month) to see certain shows. For a lot of people, the tipping point is already arriving. Last year, thanks to services like Hulu and Netflix, more than 1 million people cut their cable subscriptions. Since 2008, 2.65 million people have cut the cord. Still fewer people are adding cable subscriptions (there were only 112,000 new cable subscribers last year).
What’s the cable industries plan to combat the losses? Raise the prices, of course. Cable prices are already increasing at around six percent each year. Today, the average cable bill is $86. By 2015, the average cable bill will be $123. By 2020, the average cable bill will be $200. That’s $2400 a year. For that amount of money, right now you could buy full seasons of around 60 shows (40 sitcoms, 20 dramas). Obviously, the cost of downloading a full season will increase over time, too, but even if, say, sitcoms ran $50 a piece and one-hour dramas ran $100 per season, you could still purchase 36 seasons of television a year.
Who watches 36 seasons of television per year? Why does anyone still pay for cable? Just imagine how much better our lives would be if we cut the cord? We’d be more selective about the individual shows we pay to watch, and we might get out of the house more to watch sports programming. That may sound inconvenient now, but when cable bills begin to rise toward $200, we may finally reach our tipping point.