Five years ago, the idea of a household without a cable TV subscription was practically unheard of. But, increasingly, “cord-cutters” are becoming the norm. In July 2016, a quarter of all US households didn’t have a pay cable subscription, and the pace of people dropping cable is only accelerating. But how do you go about cord-cutting, and is that what you want out of TV?
Why Cut The Cord?
In America, we buy our TV in bulk. The problem is, we’re buying more and more, and getting more channels, but we’re still watching the same stuff. A 2014 Nielsen analysis found that between 2008 and 2013, the number of cable channels went from 129, on average, to 189, but that Americans were still watching just 17 channels total. And remember, the way your cable bill is constructed, you pay for each channel as part of your bill whether you watch it constantly or not at all.
The cost of all that TV you don’t watch just keeps going up. The average cable bill, in 2012, was roughly $65, and it rose a whopping 39% on average between 2011 and 2015, eight times the rate of inflation. There’s no sign that’s going to stop, either. Leichtman Research, which tracks cable rates, reported the average cable bill crossed the triple figure mark in 2016 at $103. And that’s not adding in taxes, fees, and equipment rental, like the cable box.
Most people cut the cord because it’s cheaper. When I cut the cord five years ago, Netflix cost $8 a month, Hulu $8 a month, and Amazon Prime, then just a young pup of a streaming service, cost $80 a year, which I was paying anyway for the free shipping. In other words, I was paying about $22.50 a month for streaming, compared to about $80 a month for cable. Since then, the price of Netflix has risen to $10 and Prime to $100 a year, although to be fair Prime pays for itself and then some if you know how to use it, so now I’m paying roughly $25 a month. It rose about 2% a year, while my internet costs stayed largely the same.
But all three services have rapidly expanded their libraries with both classic shows and movies and their own original productions. So even as the cost has risen modestly, what you get from streaming services has vastly improved. Still, it’s a fair point streaming services don’t have everything, and there’s another option: Cord-shaving.