Cutting the cord just doesn’t pay

May 9, 2016

Want to save money? Why not cut the cord?

“You’ve heard the rumors, maybe even felt the temptation,” writes Evan Horowitz at The Boston Globe. “Everybody else is doing it, right? Cutting the cord and watching TV over the Internet.

“Except it’s not true. Cord-cutters are rare beasts, like white rhinos or Beyonce-haters.”

In fact, he explains, cutting the cord just doesn’t pay. He cites figures for the greater Boston area that probably resemble the situation wherever you live, at least if you live in the United States: “Comcast will sell you a bundle that includes 140+ channels, high-speed Internet, and telephone service for $89.99 per month for two years. Getting just the Internet—at the same 75-Mb/s speed—costs $79.95.” He notes that you can get lower speed Internet service for less but may have trouble streaming video to multiple devices.

“For cord-cutting to really take off, the economics of the industry would have to change,” he writes. “And that means greater regulation, greater competition, or both.”

Horowitz cites an engadget article from 2011 noting that regulation and competition have worked well for consumers in Europe, but you won’t be surprised to learn that American incumbent service providers remain adamantly opposed.

Perhaps the arrival of 5G will improve the competitive situation for OTT delivery of video programing.

About the Author

Rick Nelson | Contributing Editor

Rick is currently Contributing Technical Editor. He was Executive Editor for EE in 2011-2018. Previously he served on several publications, including EDN and Vision Systems Design, and has received awards for signed editorials from the American Society of Business Publication Editors. He began as a design engineer at General Electric and Litton Industries and earned a BSEE degree from Penn State.

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