Ned's posterous

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Cost Savings of Living Without Cable TV

Cost Savings of Living Without Cable TV

http://www.iseff.com/post/181268467/the-cost-savings-of-living-without-cable-tv

Advantage ...

 
http://www.hulu.com

I'll be completely honest: I'm a TV junkie. TV is extremely therapeutic for me. It's a great way to shutdown my brain after a long day of work. I like news, sitcoms, dramas, reality shows, game shows, and especially sports. I didn't think I could live without cable/satellite, especially given my reliance on watching sports (ESPN was really the only thing holding me back).

However, recently I moved from Seattle to Los Angeles. I also left a fairly high-paying job at Amazon.com for a not-so-high paying position as a co-founder of a new startup, AppStoreHQ. Colleen also went from a full-time worker to a graduate student with loans. These things have made our lives much more frugal. We've really tried to cut back on many things, especially any recurring expenses. Here's where we cut back on TV.

The Setup

First, how we watch TV (see pics at the end):

HDTV Antenna: We hooked up an HDTV Antenna to our LCD TV so we can get local HD stations. This supports watching many of our favorite shows, like The Office and 30 Rock and Two and a Half Men, etc. It also supplies us with the big sporting events that tend to be played on the networks (think: playoffs, Super Bowl, Olympics, etc). The antenna itself can be slightly flaky and we have to move it down to the ground and place it in the right position to make sure the signal is good, but once we get it set, it works really well and the quality is actually probably better than Comcast's highly awful HD.
  • The Computer - MacBook -> Apple Mini DisplayPort to DVI Adapter + Belkin Y Audio Cable Splitter -> DVI to HDMI cable -> Samsung 32" LCD HDTV: This supplies most of the other TV programming. We use a variety of services to give us programming now, but mostly it's a combination of Hulu and ESPN360.
  • DVD Player: Right now I'm actually using an original XBox for my DVD player until I get my Blu-Ray player replaced (lost in our move), but it works fine. We get our DVDs from Netflix.

    The Benefits
    Cost: This is the biggest benefit and see below for a full-analysis of cost savings.
  • Time-shifting: I can watch all of the Hulu and ESPN360 and Netflix programming any time I want, and I don't have any limits on how much I can store on my hard drive or how much I can record at once. And I don't have to pay for a special box to do so.
  • Less Ads: There's actually less ads while watching Hulu or Netflix than if I watched the shows on TV. ESPN360 still has a lot of ads, but surprisingly, they're not selling any — every single ad is for ESPN (which can get quite annoying after watching the same 5 commercials for an entire day of college football). Given how much money Hulu apparently generates, I'd be shocked if ESPN isn't working hard on this.

    The Pitfalls
    Quality: The quality of certain things — particularly ESPN360 — is pretty low. Hulu's is high, and Netflix is high, too, so it's not all bad. I do wish that ESPN360's quality was better, though.
  • Loss of computer use: This is annoying. When I'm plugged in and watching a show, I could be using my computer (and sometimes still do), but I have to literally stand up and use it in front of the TV. I'd love someone to make a device which allows me to wirelessly stream to my TV so I could keep the laptop in front of me and watch the streaming on the TV.
  • Not quite real time: This is particularly true for ESPN360 as I learned yesterday during the Michigan game. ESPN360 appears to be about 30-60 seconds behind live, which is terrible if someone calls or text messages you about a play you haven't seen yet.

    The Cost Savings

    This is the biggest win overall, so let's see how much I'm really spending.

    Starting with the up-front costs:

    HD Antenna: $35
  • Cables: $5.50 + $5.50 + $26.00 = $37.00
  • Total: $35.00 + $37.00 = $72.00

    And the recurring costs:

    Netflix: $15/month.
  • AT&T DSL Internet: $35/month.
  • Total: $15 + $35 = $50/month

    Now let's see what the old system cost, again starting with up-front costs:

    There was some Comcast installation charge for the TV and internet, I don't remember what it was, but am pretty sure it was around $50.
  • Total: $50

    And the old system's recurring costs:

    Netflix: $15/month.
  • Comcast Cable Internet: $40/month.
  • Comcast Cable TV (HDTV+DVR): $60/month.
  • Total: $15 + $40 + $60 = $115/month.

    Now let's consider the total costs over a two-year period:

    Old system: $50 + 24*$115 = $2,810
  • New System: $70 + 24*$50 = $1,270
  • Total Cost Savings Over a Two Year Period:  $2,810 - $1,270 = $1,540

    That's pretty solid if you ask me. And I fully expect the service quality, features, and available programming to get far better over the next two years as well. Finally, here are a couple pics of what it looks like, first while using ESPN360 and second while using the HD Antenna.


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