Cable TV’s business model is broken…
September 22nd, 2007 by Olivier
…at least for me.
I pay Time Warner Cable $75 a month before tax for ~100 TV channels (including HBO) and an HD DVR. At the end of the day, I only watch 2-4 hours of TV per week, which is $5 per hour of TV. Today, I miserably failed to record the rugby game France-Ireland (the sport channel I need to follow the Rugby World Cup is part of a special Sport package I don’t have), which first made me angry and lead to rationally look at my TV bill.
So, I thought about my options to reduce my TV bill:
- If I drop the DVR rental, I save $10 per month. Problem: I would never watch TV without a DVR. I am never available to watch the shows that I want, and I never have the patience to wait for the millions of ads. Plus, I need to be in control of my own destiny and not watch crap because it’s on. Bottom line: I cannot watch TV anymore without a DVR. I could buy a TiVo HD at $600, so it would be amortized in 6 years, never a good idea with high-tech…
- If I drop HBO, I save $15 a month. This wouldn’t be a major loss for now since the summer is over. I may reconsider my decision when Extras and Entourage/FOTC come back next year, but in the mean time I really don’t need 9 channels of movies, the family and the Hispanic HBO. Netflix is good enough for movies, and I don’t care about spectator sports. Bill Maher can be fun but he will have to pay the price of HBO’s exclusive distribution strategy via cable operators.
- If I drop HD, I can save another $5. But I will end up with a pretty bad picture quality, which will be like going back to black & white TV. My 12 hours of TV per month are worth an extra $0.5 for crisp sound and video.
- What is left is the $45 Digital package. I can go to basic cable and forget about HD or a DVR, or simply cancel my cable subscription. All things considered, I might just do that. With the few bucks I save, I will be less reluctant to buy multi-passes for the few shows available on iTunes.
Cable operators don’t like light consumers like me (more on this later). The only choice is either to have thousands of hours of TV or nothing. Why can’t cable operators provide a-la-carte packages? I guess they assume that we can’t live without TV at all. I don’t know about you, but in the next few weeks, I will find out if I can. Just for fun. Plus, I have a bunch of books I never have the time to finish, and I need to improve my fitness score on the Wii…

