Tuesday, February 22, 2011

Analyzing Costs for Going Cable Free - Step 3

The buzz word is Internet TV at the moment.  But this means many things to anyone you ask.  That’s because there are many options on how to achieve your needed level of programming content.  How you get to the content is more interesting because the devil is in the details.  Ultimately, there are many avenues that all lead to television programming content.  Our cable-free options could become one of the following:
·         TV programming via high-speed internet. This may end up becoming one component of the entire solution. 
·         We go completely smoke signals with an antennae. An antennae to catch the traditional and HD channels becomes the primary form of television access.   
·         Internet tv ready devices.  An investment in one or several Internet tv ready devices may be optional for us after considering usage for each device. 
·         We stick with our cable option. Considering that this is an experiment with three HD ready televisions and an effort to reign in cost per program watched, going back to cable could still become a solution if the Internet services can’t provide the level of viewer satisfaction we require.

Yearly Content Acquisition Costs
I'm of the opinion that how you get to the content is most interesting because the devil is in the details.
  

     Programming costs per service/device
Year 1
Year 2
Year 3+
Total cost for first 3 years*
     Satellite tv
$ 300
300
300
$900
    Cable tv (ATT Uverse 260 channels)
$948
948
948
$2844
     Cable tv (Digital Preferred 160 channels)
$479.88
1019.88
1019.88
$2519.64
     Roku box –XD version
$79
0
0
$79
     Apple TV
$99
0
0
$99
     Netflix subscription
$95.88
95.88
95.88
$287.64
     Hulu Plus subscription
$95.88
95.88
95.88
$287.64
     Antennae
$75
0
0
$75

*estimates do not include the monthly fee for internet connectivity; Cable packages assume a lower tiered viewing options; Satellite tv assumes only 40 channels; Subscriptions assume internet only options; Internet TV device boxes assume a mid-level product if available.

If users select an Internet TV device, say Apple TV, and Netflix and Hulu Plus subscriptions, the total 3-year cost is estimated to be: $674.28 versus $2500 with a cable provider.  Even with adding in a mid-grade antennae, users spend only $750, or less than 1/3 of the total expense from an cable provider.

Viewing Experience
The cost examples should certainly appeal to most users on the face of it.  The viewing experience is another factor to consider in the equation.  Can we watch the same content, or nearly the same content, for the same or less pain, aka commercial time to program time?   

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