Another Day, Another Flimsy Report Claiming TV Cord Cutting Won't Save You Money

Overhype

from the denying-the-obvious dept

Once a month like clockwork, somebody in the tech press proudly decides to inform their readers that you can’t save any money by cutting the traditional TV cord and going with cheaper, more flexible streaming alternatives. The logic in these reports almost always goes something like this: “Once I got done signing up for every damn streaming video service under the sun, I found that I wasn’t really saving much money over traditional cable.”

Writers leaning into this lazy hot take almost always tend to forget a few things.

One, the same broadcasters dictating cable TV rates dictate streaming video rates, so in some ways pricing will be lateral. Two, adding a dozen streaming services to exactly match your bloated, 300 channel cable subscription misses the entire point of cord cutting, which is about customization and flexibility. Three, if writers actually stopped and talked to real consumers (like in the cord cutting subreddit), they’d be told (repeatedly) how customers routinely save money each month by breaking free of the traditional, bloated cable TV bundle.

Last week it was Quartz’s turn to prop up the flimsy narrative that “streaming?s live-TV bundles aren?t actually saving cord-cutters money.” Their report was at least somewhat more scientific in nature, leaning heavily on data provided by a research firm by the name of M Science, which acknowledged that the average cord cutter saves around $20 per month by going with a streaming alternative. But the firm then tried to claim that this savings disappeared when you factored in cable company “triple play” bundles:

“When paired with the cost customers continued to pay their cable providers for things like internet, phone, or additional TV packages, the savings vanished altogether. The average virtual pay-TV subscriber paid about $15 more in aggregate than the average cable customer in 2017, based on M Science?s data.

That?s in part because customers can often get a better deal bundling two or three services from a cable provider, like TV, internet, and home phone service, than paying for internet alone. It?s marketed by cable operators as the double or triple play. ?The cable companies will incentivize aggressively for bundling and penalize for unbundling,? said Corey Barrett, senior analyst for technology, media, and telecom at M Science. ?They?ll have attractive rates for a double-play bundle and if you decide to go to broadband only, it?s going to cost more than broadband bundled with other services.?

The problem with this take is that while cable operators claim you’re getting “savings” by bundling multiple services you may not even want (cable digital phone service, especially), these savings are often part of a temporary promotion. And when that promotion expires you’re usually left paying a dramatically higher rate. While new customers tend to get offered promotions in order to get them to switch, existing customers who’ve been with the company for a while often have trouble getting a new, comparable promo when the contract expires.

In reality, ISPs like to artificially jack up the price of standalone broadband to make it as unpalatable as possible in the hopes of upselling you to additional services. That doesn’t necessarily equate to saving money. The report is also likely relying on these companies’ advertised prices, which isn’t the actual price. Cable companies are facing all manner of lawsuits for using bogus fees to jack up the advertised rate post sale, a bit of creative marketing regulators from both parties have turned a blind eye to for decades. That’s before you get to the broadband usage caps and overage fees used to punish cord cutters for leaving the cable walled garden.

Another tendency I’ve enjoyed observing in these reports is that they almost always ignore the fact that piracy exists and is aggressively common in the Plex and Kodi era. Countless consumers save money via piracy, but acknowledging this reality is seen by most news outlets and analysts as a tacit approval of it — resulting in them comically omitting it from the discussion entirely. Because you don’t approve of piracy doesn’t change the fact that it routinely occurs as a cost-cutting measure among consumers. Piracy is, as Techdirt readers have long understood, something you have to compete with whether you like it or not. If you ignore it in your analysis of TV costs you’re painting an incomplete picture.

All told, if you prefer a massive bundle of religious programming, horrible reality television, live sports and infomercials — you may want to stick to paying an arm and a leg for cable. But if you spend even a small amount of time talking to those that have taken the leap and ditched traditional cable, you’ll find absolutely no debate that cutting the traditional TV cord routinely saves you a significant chunk of change each and every month.

Filed Under: cable tv, cord cutting, money, silos, streaming