By Heather Struck
New York, January 9 Like many people paying
bills in January, Brad Hill is thinking of eliminating household
cable service. "It is an active discussion in my house," he
says. Hill, a freelance writer and former vice president of
audience development at AOL, still pays the $128 monthly fee to
his Time Warner Cable provider in part so his wife can
continue watching one of her favorite channels - HGTV.
This year might be the one in which more people ask: How
much am I paying for all these channels, anyway? And why? With
the growth of broadband streaming video and its pay-per-show
approach, the idea of paying $50 to $150 a month for 1,000 plus
channels via a neighborhood cable provider is no longer a slam
The cable industry that used to move in one direction -- up
-- is now losing subscribers who opt for less expensive and more
targeted broadband services. Comcast Corp., the
largest U.S. cable provider, said it lost 117,000 video
customers in the third quarter of 2012.
The firm still has more than 22 million paying customers,
but the loss shows a change in direction. According to the
Nielsen Company, the number of U.S. households subscribing to
pay-TV services declined by 1.5 Percent, or 1.5 million, in
The Internet-streaming alternatives - Netflix,
Amazon's Prime, Hulu and Apple Inc.'s iTunes
are leaders - have content that is less predictable than cable
television, but it is also more efficient, with customers often
paying per episode or show, instead of for the whole big
Here is how you should review your family entertainment
budget for 2013, and how to manage it.
PAY FOR WHAT YOU WATCH
It's hardest to give up cable if you love sports, news or
other specialized offerings (like that addictive HGTV) that
cable reserves for itself. And if you are hooked on a particular
new show, don't expect it to be readily available everywhere
else -- or maybe anywhere else.
The first step is to make a list of what you want to view,
find each program and its cost.
Recent episodes of many shows are available on services like
Hulu Plus ($7.99 per month) and iTunes (starting at $1.99 per
episode), but the chances that every desired program is
available through one provider are slim. When one goes to Hulu
and searches for the latest episode of the CBS program, "How I
Met Your Mother," for example, disappointment follows. The show
is available on CBS's ad-supported website, but it is not
available on all streaming devices.
If you want to watch old and new episodes of a show, you may
need more than one service. For example, fans can find the first
four seasons of the AMC series "Mad Men" on Netflix, and watch
all of them in a snowy weekend or two. However, a fan of the
show would have to use another service, like iTunes or Amazon
Prime, to watch current episodes of the program, which are
available one day after the air date.
SPORTS AND NEWS ARE SPECIAL
While many sports events are streamed online, fans who want
to consume a lot of action across multiple teams or sports, or
who want to save games for later, are probably best served by
sticking with their cable provider. However, for people who
never switch on the football game, the sports channels are part
of what makes the cable bill so expensive.
Cable sports account for about 20 percent of the fees that
providers must pay to carry channels like Disney's ESPN and
ESPN2, according to Bernstein Research analyst Craig Moffett.
Those fees are passed onto all customers in subscription costs,
including the sports indifferent.
Those who want to simply stream one team or one sport or one
game should hunt for the smoothest running service, like
fromBAR.tv; they aren't found at the usual show-streaming
News hounds face the same quandary, because you can't get
24-hour news from a station like CNN without subscribing to a
cable package. CNN allows users to stream live audio from its
broadcast, but no video.
CHOOSING YOUR HARDWARE
If you still want to watch on your big-screen TV and not
limit viewing to your computer, tablet or phone, you'll need to
spend more money on hardware, too. Many new TVs are Internet
enabled; they can run Netflix, Hulu or Google TV.
Others require an intermediary box, like a Roku
($49.99-$99.99) or a Boxee ($99), that you'll have to wire to
the TV. (One more reason for technophobes to stick with
tradition; streaming services won't send a cable guy if your
system stops working).
You can even hook up your laptop to your TV, and your added
investment would be limited to a couple of cables.
Finally, once you've made all these decisions, you will
likely have to re-evaluate, again and again. The cable industry
is constantly working to stay out front of the alternatives, and
may continue to block first-run episodes from appearing outside
subscribing households -- or find other ways to discourage cord
cutters. For example, NBC reserved a lot of its streaming
Olympics content last summer for those viewers who were already
"It is definitely too early or uncertain for most people to
switch," says Hill. Once his wife can stream HGTV all day,
though, it might be time.