The Real Financial and Emotional Cost of Cutting the Cord

BY Allconnect Inc | Sun Jan 12, 2014

cuttingthecordWhat’s the best thing about moving to a new house? Getting rid of all the unnecessary clutter that’s accumulated over the years. The second best thing? Trimming the fat off your utility bills. A new home offers the perfect opportunity for shopping around and getting the best deals on utilities, home services and that biggie: your cable bill.

It is also the best time to try out the concept of cord-cutting. I had been toying with the idea of ditching my monthly cable bill for a few years, but a move across the country was the impetus I needed to start from scratch. Faced with the bill for a 3,000-mile relocation and a 12-month lease on a lovely but ridiculously overpriced home in Mount Pleasant, S.C., I told my family of four that cable had to go – at least for the next year.

In my dreams, I had visions of us all bonding over backgammon by roaring firelight, the lack of flickering images in front of our eyeballs helping us focus on each other. In reality, however, I knew the die-hard television-addict in me just couldn’t survive. So I set about researching alternatives to a $200-a -month cable bill.

Here’s a rundown of the hardware and content options I chose for our 12-month sojourn without cable, as well as the benefits and pitfalls each offered.

Rabbit Ears

It’s funny how advances in technology make you forget that sometimes basic is best. A good old pair of rabbit ears on top of your television can get you HD digital channels for free. I picked up a mid-range digital antenna and was able to access ABC, CBS, FOX, NBC, CW and a couple strange channels that primarily involved people singing or shouting at me, all for free.

Financial Cost: $79

Emotional Cost: For some reason we couldn’t pick up PBS. Ironic, I know; the one supposedly completely free channel and we couldn’t watch it.

Tip: Before you buy an over-the-air digital antenna check out Antenna Web for a rundown based on zip code of what OTA channels you are likely to receive and which type of antenna you’ll need to pick them up.

High Speed DSL

If we’re being literal here, a true cord-cutter would suffice on rabbit ears alone, but I’m not going to do that. For most people that means making a deal with the cable company for high speed internet, which is essential if you are going to stream any movies or television shows to your big screen TV. I ended up paying an introductory price of $29.99 for 6 months for 25 Mbps down from a national cable company.

Herein lies the cord-cutting rub. Cable companies, for obvious reasons, do not want you to cut the cord. Because of this, I truly believe they make it as inconvenient and expensive as possible to do so. After my 6-month introductory offer (half the length of an introductory offer for a cable service), my bill went up to $44.99. But at the end of my 12 months, I had a call from customer service informing me that for no discernible reason my internet bill was increasing to $64.99, and wouldn’t I rather subscribe to their internet, cable TV and HBO/Showtime/DVR bundle for just $74.99 for the first year?

Financial Cost: $450 for the first year, $780 annually thereafter

Emotional Cost: After the number of phone calls I’ve had to make to my cable company regarding my internet service, I am considering therapy.

Streaming Hardware

Taking into account the hardware my family already had (including a 42″ Samsung television, 27″ iMac, an iPad and two iPhones), I opted for the Apple TV over the Roku to stream online content through our big screen TV. The streaming box has been the biggest advance for cord-cutters, as it takes the concept out of the computer and into the living room. However, it was funny how much of a barrier it was to spend $99 on a tiny piece of hardware that would hopefully be replacing a $200 a month cable bill. But once we took the leap we were hooked. That little black hockey puck under our television opened up a whole new world of entertainment to us.

Over the year we were cable free, Apple added a variety of new services to the device, essentially increasing its value after we had paid for it. Today we can watch Netflix and Hulu Plus (see next entry) some PBS, SKYNEWS, YouTube, The Weather Channel, The Smithsonian Channel and, amusingly, Korean TV, not to mention a whole ream of other channels and services I’ve yet to explore, for free. HBO GO, The Disney Channel, ESPN and ABC are also on the Apple TV, but require a cable subscription for access to the most recent content.

Another bonus to Apple TV was the ability to AirPlay content from our iPads or iMac to our television, so essentially anything we could pull up on the internet we could watch on our TV.

Financial Cost: $99

Emotional Cost: Its user interface is fiddly and the remote that comes with it is tiny and easily lost. You can download a remote control app to your iPhone, but I didn’t relish giving my 5-year-old my iPhone so he could change channels.

TIP: If you are not in the Apple ecosystem, Google’s new Chromecast offers essentially the same functionality of AirPlay mirroring, enabling you to “throw” web pages, videos and music from your computer or tablet to your TV.

Streaming Services

We opted for two streaming content services, Hulu Plus ($7.99 a month) and Netflix ($7.99 a month). Combined, these two services pretty much covered everything we used to watch on traditional cable. Via Netflix the children could watch that dastardly pineapple under the sea (SpongeBob SquarePants for the mercifully uninitiated), but thankfully minus a gazillion adverts for horrible plastic things made in China. Through Hulu Plus, which offers a large selection of current network TV shows a day or so after they’re broadcast, my husband could feast on Family Guy and I could have my date with McDreamy on Grey’s Anatomy (you do have to sit through ads on Hulu Plus, but nowhere near as many as watching on traditional cable).

Financial Cost: $192 annually for both services

Emotional Cost: No CBS. The No. 1 network in America just doesn’t want to play ball with cord-cutters, and while they do allow limited access to past episodes of some of their hit shows online, if you want the latest episodes the only option is to buy them on iTunes or a similar service. This also applies to shows on premium networks such as HBO or Showtime. The cost ranges from $1.99 an episode to $49.99 for a series.

Overall Financial Cost

First Year

Cable: $1,080 – an introductory offer including internet, digital cable, a DVR and free HBO for 3 months.

Cord-cutting: $920 – including purchasing hardware, subscribing to streaming services and dropping the occasional chunk of change on an iTunes season pass.

Second Year

Cable: $1,620 – the introductory offer increased to $110 a month, and with no free HBO you’d be paying an extra $300 a year to keep it, because of course now you’re hooked on Game of Thrones.

Cord-cutting: $1,072 – assuming none of our streaming service subscriptions went up (which they haven’t so far) and we didn’t need to buy any new hardware, the price would have gone down. But the cable company more than doubled our internet bill from $29.99 to $64.99 monthly.

Third Year

Cable: $2,232 – by year three all bets are off and we would be paying full whack for our existing cable services.

Cord-Cutting: $1,072 – assuming the cable company didn’t increase our internet bill even further, or we had been able to find a viable, cheaper alternative, by year three cord-cutting really comes into its own financially. And with an over $1,000 savings annually, you can feel less guilty about purchasing that season pass for Homeland.

TIP: Cable TV has a distinct advantage of being available in every room you have a hookup in for relatively little extra cost. Most of the cord-cutting hardware available only works for one television, so if you are a five TV household there’s a substantial increase in the initial outlay for cord-cutting.

Overall Emotional Cost

As it now stands, the financial cost of cutting the cord is evident. But what about the emotional cost? Cord-cutting really is a lifestyle choice, and we discovered we had to adjust our routine significantly. Also, as a die-hard television addict I’ve had to come to terms with no longer being up on the latest and greatest show. For example, I completely missed out on Breaking Bad, and while I’m looking forward to catching up on Netflix when I have a spare 80 hours, I already know so much about it from general online and media chatter that some of the impact will be wasted on me I’m sure.

The “simply sit back and watch” option of cable TV is something I was surprised to find I missed. Cord-cutting involves lots of effort, lots of remote controls and lots of decision making. For a family of four you can see how that spells disaster every time we sit down to watch something together.

On the plus side however, I watch far less television, my children are exposed to far fewer advertisements and inadvertent unsuitable content, and my husband and I have discovered new shows, movies and other content we would never have known about if we stuck to traditional cable (did you know The Smithsonian had a TV channel).

But the biggest factor outside of cost that makes me want to stick with cord-cutting is that watching content with little to no advertisements is a genuinely enjoyable experience. I honestly don’t think I could go back.

Conclusion

If you are not at least marginally tech-savvy, don’t consider cord-cutting, yet. Until there is a simple all-in-one solution where you can turn on your TV, pick up one remote and elegantly navigate through Netflix, Hulu Plus, iTunes and all your local channels, cord-cutting will always be a niche area. It requires technical know-how to deal with the equipment, and patience to sort through different apps, or browse a series of websites to find the show you want to watch, where it is available, and if you have to pay extra.

There are a lot of products and services coming down the line that attempt to address these problems, but the cable companies and TV networks are fighting hard against many of them. So, only time will tell if cord-cutting is here to stay or if some sort of cable/cord-cutting utopia exists in our entertainment consumption future.

Jennifer Tuohy is a freelance writer, editor and social media consultant as well as an avid technophile. Jennifer writers about the latest consumer technology for www.ebay.com.

Allconnect is a free online resource to review and compare the costs and choices for essential home services, including home utilities, high speed Internet, phone, cable TV, satellite TV, and home security systems.

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