Last week, Consumer Reports ran a story promoting the idea that cable TV is a better deal than cord cutting now that DIRECTV NOW prices went up. The story promoted Dan Rayburn, the principal analyst at the media research firm Frost & Sullivan.
According to Rayburn, “If you’re paying $140 a month for a triple-play bundle, your TV services may only cost you $50 a month.” According to Consumer Reports, “that means that cable TV could actually be the low-cost option.”
Earlier in the story when talking about services like Sling TV and PlayStation Vue Rayburn said, “These services were initially pitched as cheaper alternatives, but prices are getting too high to be considered cheap. That may make traditional TV plans more compelling,” says Rayburn.
Update: Dan Rayburn posted this comment on our story today “Since I am the one you are quoting in the article, you need to get the facts straight. My bill is $141.21 WITH the taxes and fees. $109.99 for triple play, $3.99 for a cable card, and $27.23 in taxes and other charges. So saying I am “ignoring the fees and taxes” is not accurate. Also, saying “the fact that the $140 price is a promotional offer that will end before your contract ends”, is not true in my case. That’s the price I pay for two years. And I don’t mind paying some of the additional “fees” as it gives me my local sports teams, something no streaming service does, without blackout restrictions.”
We still stand by our stance that cord cutting for the vast majority of people will save them money. Also for the vast majority of people cord cutting can give you the sports you want without a blackout. As you see in our comments many of our readers pay less than $140 for TV and internet. As for the $141.21 a month when we look at Comcast’s cheapest Triple Play bundle in our area we find that with the fees we list below it works out to $167.48 in our area. (Before the promotional rate expires and the price goes up.)
Even if you can get cable TV for $50 a month Sling TV, YouTube TV, and more are less than $40 a month.
Here is an example of some of the fees and taxes you will find with cable TV.
Comcast’s Fees & Taxes
- Additional TV Services: $18.91
- Additional Internet Services: $13
- Add’l Products, Services & Equipment Fees: $33.96
- Other Charges & Credits: $13.23
- Taxes, Surcharges, & Fees: $8.39
You can find a full break down of these fees and taxes HERE.
Total $87.49
Charter’s Fees & Taxes:
- Broadcast TV and Sports Programming Surcharge: $11.55
- Taxes: $9.09
- HD Set Top Box Rental Fee: $11.75
- Digital Converter: $6.99 Per TV (So if you have 3 extra TVs that will cost $20.97)
- Other Fees: $7.53
Total: $60.89
You can find a full break down of these fees and taxes HERE. (Note: This example is slightly different because we only included three TVs and used the updated pricing of $6.99 per digital converter.)
Not only that but this Consumer Reports story ignores the fact that DIRECTV Satellite packages went up this year also. Other services like Spectrum have raised their price twice in just the last 12 months.
The last thing this story forgets is that cord cutting has no contracts. Don’t like DIRECTV NOW’s price hike? There are over 10 live TV streaming services you can switch to in just a few minutes. This idea that if DIRECTV NOW is too expensive you should just go back to cable TV ignores the fact that there are other options for cord cutters.
As we always recommend when you see these “cable is now cheaper than cord cutting” stories is to do your own research. Do your own research on what we say and what stories like this say. After all these years we find that the vast majority of people we work with save money with cord cutting and get the shows they want to watch.
Update #2: Still don’t think cord cutting will save you money? Here are several studies that show the savings you can see with cord cutting.
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