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If you’re tired of paying for cable TV, then I’ve got good news for you.
Millions of people are already saving a few thousand dollars a year by eliminating cable TV in favor of streaming boxes. The amount of money you save is a huge incentive to switch. But there were two things preventing some people from finally ditching cable.
Streaming services like Hulu and Roku have news channels like CNN, Fox, and MSNBC but their versions didn’t broadcast the same live, up to the minute news we see on cable. Hulu and Roku only showed pre-recorded interviews and news clips. That was an issue for some people.
Although Hulu and Roku are available for less than $10/month and feature network channels like CBS, NBC, Fox and ABC, you wouldn’t see the local affiliates you’re used to seeing, like for news or weather. That was an issue too, for some people.
Those two things may not bother some people. I don’t watch much network TV at all. Haven’t seen a sitcom in years. But I do like to watch the news, and watching some pre-recorded clip from a week ago didn’t interest me.
There was a way around that. Kind of. You could also buy a digital antenna for a one-time charge of about $60, and then see your local affiliate of CBS, NBC, and ABC. But not cable news.
But now that’s changed.
The Game Changer
Hulu has recently introduced their streaming live TV that features the big three networks as well as cable news. The real up to the minute news exactly as it airs on cable. Finally, you can make an apples to apples comparison between streaming and cable.
In fact, here’s a quick comparison of the last cable bill I received before switching. I had called the cable company several months earlier advising them that I was going to terminate my service unless they could provide a cheaper rate.
Their reply was “how about $148 per month for triple play”, their internet, TV, and phone service. I agreed because the base rate was about $50 less than what my current charge was.
But here’s what the actual bill shows we were paying:
- $148.49 – Starter Triple Play (doesn’t include HBO, Showtime, Starz etc. But it does include over 100 channels I don’t watch).
- $ 10.00 – HD/DVR Converter. The cable box we rent from them.
- $ 9.95 – HD “technology fee”. Really??
- $ 16.47 – Additional outlets. Their monthly rental charge for boxes on the 3 additional TV’s in the house.
- $ 2.00 – Remote control rental charge.
- $ 7.00 – Broadcast TV fee. (This one surprised me. I’m already paying for channels I don’t even watch)
- $ 1.23 – Universal “Connectivity charge”. Huh?
So, I was paying an extra $46.65 every month for a combination of rental fees and charges. $559.80 per year down the tubes.
Their “$148” rate was actually $195.14! Or a whopping $2341.68 for the year! For the privilege of watching TV.
I don’t know about you, but if I’m trying to trim expenses, this one stands out more than any other.
So, how much can you save?
Obviously, you can terminate cable TV altogether and pay nothing. But if you have family members who do want to watch TV that could put you in the doghouse.
The two most convincing reasons to ditch cable and use a streaming box are:
You immediately cut out all rental charges.
You pay only for what you want. You’re not subsidizing the cable company’s cost for channels you never watch.
To compare the cost for streaming TV to the cost of cable above, I’ll use the same four TV’s. To stream content to each TV, I’d need to buy a streaming box for each TV. But this is a one-time charge. You’d recoup the money you pay for them within a few months. And after that, no more rental fees.
If you’re hesitant to have to lay out money for streaming boxes, just take a look at your cable bill. Add up how much you’re paying to rent their cable box, the additional boxes on every other TV and remotes. A typical hi-def cable box with DVR rents for about $20 per month and boxes for each additional TV are probably at least $5 each month. With just two TV’s that’s $300 per year in rental fees.
You’d also still need an internet connection. So, when you call to cancel your cable, you’d have to either switch to “internet only” or if they can’t offer you an internet only connection for a reasonable price, you may want to switch to another provider. In my area, I can get a broadband internet connection for around $40 per month.
What Would I Need?
You can get a streaming device for anywhere between $30-$150 depending on the features you want. I’ll use a mid-range price of $46 for the Roku 2710R one of the more popular streaming boxes. You can also buy a more full-featured streaming box for your main TV and a more inexpensive option, like a Google Chromecast for TV’s in other rooms.
Here’s what I’d pay for the first year:
- $184 – the initial cost for 4 streaming boxes.
- $ 96 – Hulu’s basic plan of $8 per month for 12 months. (I’d also be able to view Roku’s free content and anything on the internet.)
- $480 – One year of internet service.
- $760 – Total for the first year. So, I’ve saved $1581.68 in the first year, even though I’ve laid out money to buy four streaming boxes.
Now, here’s where you really start to save. This is what you’d pay after the first year:
- $ 96 – Hulu’s basic plan of $8 per month for 12 months.
- $480 – One year of internet service.
- $576 – Total for each year going forward. Now I’m saving $1765.68 compared to cable.
Now, just to be clear, Hulu’s basic plan of $8/month is the one that has tons of content included and you can watch whatever else you want from the internet. But it doesn’t include the live network news. If you’re not a news junkie that may be fine. It does have plenty of family and kid oriented content.
Here’s another option. It’s a little more expensive but would meet your needs if you need network channels and cable news.
For the first year:
- $ 184 – the initial cost for 4 streaming boxes.
- $ 480 – $40 per month for 12 months for Hulu’s live streaming option. This includes channels like CBS, NBC, ABC, CNN, Fox, MSNBC.
- $ 480 – One year of internet service.
- $1144 – Total for the first year. Still, a yearly savings of $1197.68 ($99.80 per month) in the first year of ditching cable.
And for every year after that:
- $480 – $40 per month for 12 months for Hulu’s live streaming option. So, you’d be able to watch live network TV, plus Hulu’s content, Roku’s included content, anything from the internet, or even Amazon Prime video if you happen to subscribe to that.
- $480 – One year of internet service.
- $960 Total for the entire year. No more rental fees and you’d be paying for whatever you watch, not what the cable company wants to bundle to you.
So, for every year, I’m now saving $1381.68 ($115.14 per month) and still able to watch live network TV.
What would you do with an extra $1381.68 each year? Grow your emergency fund? Maybe make a regular deposit into an IRA? I can picture a Mexican beach, clear blue water, and a Dos Equis.
It’s all about what’s right for your family. We all have different situations and different preferences. This is an example of what you can save if you happen to have four TVs.
The game changer is that now, regardless of your situation, streaming and cable can be compared on an equal playing field. A streaming service can now provide the same content as your cable company.
And for my money, it makes no sense to pay lots of money in rental fees and inflated prices for content you never watch.
So how can you go about it?
If you have cable now and are considering switching, here’s a way you can try it out before canceling cable. Try buying just one streaming box. Disconnect the cable from one TV and connect the streaming box. It’s literally a five-minute setup. The streaming box will use your home wifi.
If it’s a Roku box, you’ll be able to browse their content and see what’s available for free. You can also spend the eight bucks to sign up for Hulu and try it out. You can always cancel it anytime. Or if you subscribe to Netflix or Amazon Prime you’d have hundreds of shows and movies through their services.
What makes some people hesitate to finally get rid of cable is the fact that they have internet and television bundled into one price. It’s ‘easy’ to just pay one bill. And cable could always offer what streaming couldn’t – local network channels and cable news. Not anymore though.
The cable company counts on the fact that they’re supplying your internet access and hope you won’t take the initiative to do a bit of work to save yourself a bunch of money.
But according to Money Magazine, 1.4 million people canceled their cable TV in the 2nd quarter of 2016, and that number is on the rise. Now that you can stream anything you’d normally watch on cable – and pay a lot less for it, I think it’ll rise at a much faster rate.
Are you thinking about cutting out cable? Or if you did, how has it worked out? Do you miss it?