The Real Cost of Cutting the Cord: Are You Better Off With Cable or Its Alternatives?
It’s an attractive idea, unshackling yourself from a cable plan. No more yelling at your DVR for not recording The Americans or having to deal with awful Comcast customer service. There are hundreds of channels you haven’t even heard of, and the idea of paying for them is kind of galling. All you need is an internet connection and a way to stream the stuff you want to watch. You should end up saving a ton of money. …Right?
Well, maybe. You’ll still need to pay for that internet connection. Unfortunately, the largest internet service providers (ISPs) are also cable companies and thus inclined to charge more for unbundled internet. To get the content you want to watch, you’ll need to subscribe to one or more over-the-top (OTT) services. And unless you only watch media on your laptop or some other mobile device, you’ll also need a means of accessing the internet through your TV.
To see how much you’ll save, we’ve done the math on a few potential scenarios, with a wider breakdown at the end that will allow you to do your own math, should you so desire.
UPDATE, JULY 21, 2015: A lot can happen in a few months’ time. HBO Now is now available on Android and other non-Apple devices. Showtime has launched its own standalone OTT service. Lifetime wants people to fork over $3.99 a month for access to all its movies (The Lifetime Movie Club). Hulu is planning to roll out an ad-free tier (for a theoretical price of $12-14). Even more of a record-scratch: Comcast is in the process of rolling out a TV-via-the-internet service called “Stream,” which includes HBO and use of a cloud DVR (but little else). We’ve updated the list of services and prices available below the following scenarios.
SCENARIO #1
You are two thirtysomethings cohabiting in the suburbs outside Chicago. You have a kid who’s about to turn two (condolences). For internet service, your “best” option is Comcast (condolences). You sign up for 25Mbps at $29.99 per month.
One of you cannot live without access to televised sports, so you sign up for Dish’s new OTT service Sling. You don’t have a satellite dish; this is live TV delivered over the internet. For $20 a month, you get ESPN and other Disney-owned cable channels (Disney, ABC Family), AMC, most of the networks in the Turner family (TNT, TBS, Cartoon Network), Food Network, Travel Channel, and El Rey (“Wha?” Exactly).
Netflix is rapidly turning into an indispensable streaming service thanks to its catalog of great shows (Parks and Recreation, Breaking Bad, Netflix Original Orange Is the New Black), and it’s got tons of kids’ programming for your munchkin. In order to get access to the latest Gotham episode the day after air, rather than having to wait eight days for free access via the network’s site or the free version of Hulu, you get Hulu Plus. You’re also a Game of Thrones and Last Week Tonight with John Oliver devotee, so you sign up for HBO’s new OTT service HBO Now.
You decide on the Apple TV as your portal to these OTT services.
All together, you have:
- Netflix: $8.99/mo
- Hulu Plus: $7.99/mo
- Sling: $20/mo
- HBO Now: $14.99/mo
Cordless total per month: $82, plus one-time payment of $69 for Apple TV
Cost of a Comcast Xfinity “Triple Play” (cable + internet + phone) package: $79.99
SCENARIO #2
You’re a 27-year-old living by yourself in northern New Jersey. You go with Optimum’s “$44.99/mo for 50Mbps” option, so you can get HBO Now. (Optimum is the only cable company that has brokered a deal with HBO to offer the standalone service.) You have essentially the same programming needs as the couple above, minus the sports, and back seasons of your favorite shows (Hannibal, The Americans) are only available on Amazon Prime, so you need to add that in, too.
You decide to upgrade to an Xbox One to connect to your TV. You’ll need to subscribe to Xbox Live in order to access the internet through it, though.
- Netflix: $8.99/mo
- Amazon Prime: $8.25/mo
- Hulu Plus: $7.99/mo
- HBO Now: $14.99/mo
- Xbox Live: $10/mo (Necessary for access to Netflix, etc. via Xbox)
- One-time payment for Xbox One: $349.99
Cordless total per month: $93, plus $349.99 for new Xbox One
Cost of an Optimum “Triple Play” package: $89.99
SCENARIO #3
You’re empty-nesters in Southern California. You go with AT&T U-verse, which has a $49 internet-plus-HBO Go-and-Amazon Prime bundle. You’re only getting up to 18Mbps, speed-wise, but that should be enough to stream HD media, if U-verse delivers the speed they’re advertising.
Hulu Plus has a large selection of the Criterion Collection available to stream, and the Warner Archive Instant service has a lot of old movies you enjoy revisiting. You both love NCIS and Blue Bloods, so you might as well get CBS All Access, which gives you access to all of their episodes on demand (plus older shows like The Twilight Zone), and will even allow you to stream live TV—provided you’re in the right TV market. You have a granddaughter, and you want to have some sort of kid-friendly programming for when she comes to visit, so you “splurge” on Nickelodeon’s new OTT service Noggin. (Noggin is only available on Apple devices right now, though, so she has to watch on your iPad.)
In order to access Hulu Plus, CBS All Access, and Warner Archives through your TV, you go for the Roku 3 4200R Media Player at $94.
- Hulu Plus: $7.99/mo
- Warner Archives: $9.99/mo
- CBS All Access: $5.99/mo
- Noggin: $5.99/mo
Cordless total per month: $78, plus one-time $94 payment for Roku 3
Cost of an AT&T U-verse “Double Play” (cable + internet) package: $89
SCENARIO #4
You’re a 22-year-old kid just out of college, living with three other people in a house. You live in an area where Verizon FiOS is available, so you choose their 25Mbps internet service, for $54.99 per month (the cheapest option). You can’t imagine a life without live sports, or The Walking Dead, or True Detective, and Netflix is just kind of a given. You’re also a huge fan of Amazon Prime’s Transparent, and who doesn’t like free two-day shipping?
One of your roommates already has an Xbox, so you don’t have to shell out $349.99 for that until your living arrangement inevitably falls apart, and you all already have at least one Apple product, for HBO Now.
- Netflix: $8.99/mo
- Sling: $20/mo
- Xbox Live: $10/mo
- HBO Now: $14.99/mo
- Amazon Prime: $8.25/mo
Cordless total per month: $117.25
Cost of a Verizon FiOS “Double Play” package: $74.99
SCENARIO # 5
You’re the same kid we just talked about in Scenario #4, but you’ve realized that you could, if you really wanted, not bother with paying for any of these official services, and you’d probably get by pretty well. You could crib a friend’s HBO Go password. Your parents may take pity on you and let you use their Netflix account (after setting up a different profile for you, because they really don’t want to know how many times you’ve watched Blue Is the Warmest Color, my goodness), and maybe even their cable provider login, too, so you can use WatchESPN and Comedy Central‘s online on-demand services. This option, TV Insider feels obligated to note, is Not Good, and very close to theft. But anecdotal evidence suggests an increasing number of cash-strapped Gen Y-ers going this route.
Cordless total per month: $54.99
Cost of a Verizon FiOS “Double Play” package: $74.99
SCENARIO # 6
You’re a worker bee in Boston, somewhere in the Gen Y age range. Comcast Stream sounds cool to you, so you sign up as soon as they launch. (Boston is the first market in which the service will be available.) But since it includes, essentially, just broadcast networks and HBO, you decide to supplement with Hulu, through which you can also tack on Showtime’s new OTT service Showtime (the shared name certainly isn’t confusing at all) for an extra $11/mo. You’ll suffer inconvenience of going over to your buddy’s place to watch the sporting events you don’t have access to. Online speeds of up to 25 Mbps will cost you (as of this writing, in your area) $66.95/mo.
- Hulu Plus: $7.99/mo
- Showtime: $10.99/mo
- Comcast Stream: $15/mo
- Netflix: $8.99/mo
Cordless total per month: $109.92
Cost of a Comcast Xfinity “Triple Play” (cable + internet + phone) package: $79.99
Of course, a large chunk of people who subscribe to pay TV also subscribe to one or more streaming services, or they have a more expensive cable package, so they’re not necessarily just paying $80 or $90 a month. But the savings are still less than you think, for a greater level of inconvenience. If you do find yourself with a burning need to watch the Justified series finale live, you won’t be able to; and the more devices and services you have, the more likely you are to experience some sort of tech glitch. Plus, you still have to deal with gross incompetence (or willful obstruction) from your ISP.
But life is full of tradeoffs. If you want to figure out for yourself what it’ll cost to cut the cord, here’s a list of the most popular services you can use to do the math:
Streaming Subscription Services:
Netflix: $8.99/mo
Amazon Prime: $99/year ($8.25/mo)
Hulu Plus: $7.99/mo
CBS All Access: $5.99/mo
HBO Now: $14.99/mo
Showtime: $10.99/mo
Comcast Stream: $15/mo (Not yet available nationwide)
Noggin: $5.99/mo
Warner Archive: $9.99/mo
Acorn TV: $4.99/mo
PlayStation Vue: $49.99/mo (Includes live TV/ability to record for 53 channels, not including ABC or ESPN; $60/mo for additional sports networks; $70/mo for 26 more channels.)
Sling: $20/mo (Includes live: ESPN, AMC, Disney, Turner nets, ABC Family, Travel Channel, Food Network, El Rey. Add-ons for $5/mo each: Other Disneys; other sports networks [i.e. NBCSN]; HLN, Cooking Channel, DIY, Bloomberg. Add-on HBO: $15/mo.)
Streaming Hardware Options:
Chromecast: $30
Apple TV: $69
Amazon Fire TV: $99
Amazon Fire TV Stick: $39
Roku: $49.99 (3500R Streaming Stick), $94 (Roku 3 4200R Streaming Media Player)
PlayStation 4: $399.99
Xbox: $349.99
Wii: $299.99
Blu-ray player: ~$75 (Depending on brand)
Smart TV: ~$400 for 40″ (Depending on brand)
Broadband Internet Options:
Caveat emptor: Prices depend on availability, your location, deals providers may be offering, etc. This is not a comprehensive list of ISPs, but they are some of the biggest companies. As a benchmark, Netflix recommends a downstream speed of at least 5Mbps for HD streaming; all of the speeds listed are advertised as “up to,” which means you might not (probably won’t) experience that speed all the time.
Time Warner Cable: $34.99/mo for 15Mbps; $44.99 for 20Mbps; $54.99 for 30Mbps; $64.99 for 50Mbps
Comcast (Xfinity): $29.99/mo for 25Mbps; $39.99 for 25Mbps + HBO Go; $59.99 for 105Mbps; $89.99 for 150Mbps
AT&T U-verse: $29.95/mo for 3Mbps; $34.95 for 6Mbps; $44.95 for 18Mbps; $64.95 for 45Mbps; $49 for 18Mbps + HBO/HBO Go/Amazon Prime
Optimum: $39.95/mo for 15Mbps; $44.95 for 50Mbps; $59.95 for 75Mbps; $94.95 for 101Mbps
Verizon FiOS: $54.99/mo for 25Mbps; $64.99 for 50Mbps; $74.99/mo for 75Mbps (all with 2-year agreement)
Charter: $39.99/mo for 60Mbps
First published March 20, 2015.
