Netflix vs. Cable Cost Analysis

The Get Rich Slowly blog compared Netflix and iTunes to cable TV:

In total, we probably watch 250 hours of television a year, and we pay $789.84 to do it. That’s $3.16/hour. That’s dumb. I complain about how expensive movies are, but watching television is costing us just as much. One solution, of course, is to watch more television. That would lower our cost per hour! It should be no surprise that this idea holds no charm for me.

From 2004-2006, we paid $677.44 and received 378 discs, for an average of $1.79 per disc. If you figure roughly two hours per disc, we pay $0.90/hour to watch video via Netflix. Netflix is a good deal for us.

via DVD Dossier.

Comments

[Ricklogic]

When I take my two daughters to the theater, it costs me about $35 including junk to eat. That's about $12 per hour.

[Ricklogic]

Get Rich Slowly, how many of the 378 discs did you put back in the envelope after 20 or 30 minutes and had to watch TV anyway?

[prozac]

Just recently I made the choice to give up cable tv (no ESPN or Yes will hurt the most but alot of MLB games and postseason will be on regular TV)
I upgraded to the 3-out plan and am going to try it out for a few months.

[machinegunn]

I've been without cable for 9-10 months. College sports are the only thing I really miss watching. I felt like I was missing out a few months ago and went from the 3out plan to the 5out plan for a while, but realized I didn't have as much spare time as I thought and have come back down to the 3-out plan. Not having good reception for broadcast TV could be a dealbraker for some. If nothing else, it has kept me from just sitting on the couch and watching reruns or shows I don't care about. I tend, now, to watch shows I haven't seen and actually want to watch. My tolerance of commercials has gone down greatly as well.

[Matt]

I'm on the "Netflix only" 5-out plan. More TV than I need--I could probably do with 3-out as well--but I'll pay for the extra selection.

[Hunter McDaniel]

I keep saying that Netflix plus over-the-air digital TV is the killer combo. There are a few things I miss out on (Monday Night Football on ESPN, South Park on Comedy Central) but they aren't worth $60 a month - especially when compared to the value of what I get from NF for $18.

[prozac]

Nice to hear Hunter and machinegunn are doing it without cable...guess I'll be fine.

[type-cast]

Nice to hear Hunter and machinegunn are doing it without cable...guess I'll be fine.

BY THE END OF THE FIRST MONTH, I DIDN'T MISS TV. I gave it up years ago. I started off by dumping the overpriced movie channels with a meager selection of titles. Unlimited rental deals like Netflix, Movie Pass, and MVP made cable obsolete. I'd rather pick my DVDs than accept their limited selection. Avoiding the commercials is also a plus. TV sucks.

[mrdiesel]

I use the Netflix 4-out plan plus over-the-air digital/HD TV and agree completely with some of the comments here that it's the way to go. I cut the cord on DirecTV in October 2006 and haven't regretted it one bit. Lots of folks I know are doing the same thing, so it looks like Netflix may be having some impact on cable/satellite subscriptions. It would be interesting to see some real statistics on this if someone has it available.

[jimofoz]

I can't remember the last time I had cable. I do have the 3 out Netflix and have rabbit ears that get the 3 networks and PBS fairly well and fox kinda-sorta sometimes. I watch maybe 4-5 shows a week on TV and the rest are DVDs. This works for me quite well. The rest of the time I'm reading, surfing the net or puttering around the house.

[Edward R Murrow]

Life would not be worth living for me without Comcast. I love the On Demand thing and used it last night to watch an episode of Real Time with Bill Maher which I missed last week. Tonight, I'll watch Rome episode 19: Death Mask since I missed that Sunday night.

Lastly, I pay a little extra to Comcast in order to have access to as many sports channels as possible. I can't get enough sports without the additional Comcast sports package.

[lynn117]

i did the math and my cable costs about $1.55 a day. sounds like a bargin to me since i watch at least 2 hours a day!

[Hunter McDaniel]

lynn117- I don't mean to knock what works for you, but here are a few other things you might want to think about.

1) How much of that two hours a day are you watching cable exclusive channels (Comedy Central, Discovery, A&E, etc.) vs. network TV which you could have gotten for free?
2) How much of that two hours are for real entertainment/sports vs. just background filler? I don't consider an hour's worth of CNN or the Weather Channel to have the same kind of value as an hour's worth of DVD programming - I'd value them more like "radio".
3) If you like the Weather Channel, NBC has a free alternative called Weather Plus which is broadcast in much of the country.
4) With the exception of premium channels like HBO, you are paying twice - once through the subscription fee and then again by having to endure the commercials.

[machinegunn]

There are indeed many factors to consider in this equation. To point out one more: if you travel much (ex: I'm a student so during breaks I can be away from home for a week or more) being able to take a few discs with me or change my shipping address temporarily is more valuable than paying for cable that wouldn't be watched while I was away.

On the other hand, a DVR mitigates the problem. I would think paying up for a DVR makes cable much more valuable than it would be without, even considering the extra cost, since it can answer Hunter's points (2) and (4) if used effectively.