Dropped Cable TV Today

[MichaelB]

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Originally Posted by bUU US Disposable Personal Income increased from just below 12,000B to just above 13000B in "the 12 months ending January 1, 2013". So compare that 5.1 percent increase in the cost of cable to the 8.3 percent increase in disposable income. ./. In the longer comparison, 1995-2013, US Disposable Personal Income increased 122.8%, actual. I leave as an exercise for the reader the conversion of that to a compound average growth rate, but I suspect you'll find it pretty comparable to 6.1 percent.

The per capita rate of change of disposable income for '04 - '04 was 0.9% (BLS, here). IIRC This is much more consistent with the median real wage increase over that same period. Makes the cable price increase look even worse.

Comparing a price increase with a change in income is a way of saying "the increase is affordable". That is not relevant when the point is cable prices are rising faster than other prices, and this motivates people to cut the cord. The income comparison is a red herring.

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Originally Posted by bUU Again, just because it supports your contention doesn't make that an appropriate benchmark. Apples-to-apples... discretionary expenses to discretionary income.

What makes CPI the appropriate benchmark is that what is being compared - the change in cable prices vs prices of all goods and services - are all using the same methodology and all have the same numerator, denominator, and formula for rate of change. When you compare a change in prices with a change in something that is not price, that is apples-to-someting-that-is-not-apples - and not even a fruit.

[bUU]

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Originally Posted by MichaelB The per capita rate of change of disposable income for '04 - '04 was 0.9% (BLS, here).

Yet it was 5.1% based on my calculations. I guess we'll just have to agree to disagree, and everyone can do their own computations using both my source and yours, making their own decision.

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Originally Posted by MichaelB Comparing a price increase with a change in income is a way of saying "the increase is affordable".

No, it is the proper way to compare price increases in consumer marketplaces. We'll just have to agree to disagree about that, as well.

[rodi]

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Originally Posted by bUU With that more reasonable comparison, cable looks to be a bargain.

LOL - that statement does not ring true at all. You may be convinced of it, but I doubt most consumers agree. It really sounds like you are a paid shill for the cable industry.

[bUU]

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Originally Posted by rodi LOL - that statement does not ring true at all. You may be convinced of it, but I doubt most consumers agree. It really sounds like you are a paid shill for the cable industry.

Except I'm not, and your attempt to disparage me and my comments by the insinuations associated with saying so are troubling. I've already made very clear that from a consumerist perspective things won't look the same way. Things practically never are the way they seem from only one side of the issue. So please let us respectfully agree to disagree rather than throwing insulting words like "shill" at each other.

[MichaelB]

All right, let's all take a step back and relax .. we're among friends

[ERD50]

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Originally Posted by bUU Television entertainment is a discretionary expense. Comparing its pricing to the cost of bread, milk and eggs is irrelevant. Rather, the price of it and of all discretionary expenses must be compared to United States Disposable Personal Income. ...

OK, going with the idea that it is a discretionary expense, rather than compare it to discretionary income, how about a basket of discretionary goods (not a single random item)?

Is there such a thing from BLS? I don't know.

-ERD50

[bUU]

That sure would be interesting. I provided earlier an anecdotal comparison (to Walt Disney World admission prices), but admitted that's probably an outlier.

[Gotadimple]

So, if cable is too expensive, is access to the internet too expensive? Is the internet now a utility important to basic living? Don't most people get access to the internet either through their cable subscription or through a phone system (cell, landline)?

I think it's one thing to say that access to television is too expensive and a discretionary expense, but, that access to the internet isn't a consideration. For many they are linked.

[bUU]

That is an argument someone is going to have to actually stand up an make (not here - in the halls of government), because it is not the legitimate reality today. I suspect no one has made the argument because they recognize how little there is to be gained for them personally: No reasonable court or agency would find that unlimited Internet service is a necessity. So the end-result of such an argument would be the establishment of basic Internet service, a certain amount of MB (yes, MB, not GB) at a certain speed, for a nominal price, akin to basic cable television service, which offered only OTA channels, some shopping channels, and local government channels, for a nominal price. Do recall that the provisions regarding essential services, as they pertained to cable television, and as they would pertain to Internet service, involved news, weather, and information, not access to sports programming or other entertainment.

[rodi]

I apologize. I should have said spokesman. You are advocating the MSO perspective quite well.

[GTFan]

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Originally Posted by bUU Good thing that Comcast also increased their cap. Regardless, you point out something very important: A common complaint about cable Internet is that it has no competition. Perhaps without realizing it, you've highlighted that that's not true. Remember, the laws related to competition are rightfully blind to the distribution mechanism. That's why competition from satellite subscription television services were the basis on which the FCC declared effective competition in markets, thereby allowing cable incumbents to competitively price (i.e., increase prices) their basic offerings and encrypt their broadcasts of OTA channels.

Completely ignoring a few salient facts of course, which is that cell service latency is not in any way comparable to wired HSI service. This matters if you're a gamer, for example. And that cell data caps are an order of magnitude lower than wired, and 'unlimited' data on cell is not really unlimited, it's always throttled after you hit low thresholds. And that tethering is highly restricted if it's even allowed at all, so goodbye whole-home service.

Can it be a competitor for very low usage scenarios? Sure, but that's not the way the market is going, especially with streaming video taking over as seen in this thread. And it's certainly not effective competition under your TV analogy nor is the FCC is not going to declare it as such. They would be pilloried for such an assertion at this time.

[bUU]

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Originally Posted by rodi I apologize. I should have said spokesman. You are advocating the MSO perspective quite well.

Nah. They wouldn't be as open, honest and upfront about these realities as I am, because doing so doesn't reflect well on them in the minds of consumers. The perspective I've shared is more akin to how a journalist reporting the issue in a balanced way would characterize things.

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Originally Posted by GTFan Completely ignoring a few salient facts of course, which is that cell service latency is not in any way comparable to wired HSI service.

And satellite subscription television service goes flaky in strong rainstorms. Again, regulators and agencies aren't looking at quality or price advantages or disadvantages. Those are respective competitive advantages that one provider or another provider may have to garner more market share than another provider. What courts and agencies are looking at is whether the service is provided, yes or no.

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Originally Posted by GTFan Can it be a competitor for very low usage scenarios?

Essentials of life = very low usage scenario.

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Originally Posted by GTFan And it's certainly not effective competition under your TV analogy nor is the FCC is not going to declare it as such. They would be pilloried for such an assertion at this time.

You mean like they were pilloried for all the determinations of effective competition they made with regard to cable television service? (They were.) ... like they were when the details of their "net neutrality" rules implementation became clear? (They were.) And so on? Even with the current, more consumerist makeup of the FCC (as compared to ten years ago), consumers only "win" half the time. So, yes, they may very well consider cellular Internet as effective competition to cable Internet.

Answer this: Why hasn't anyone sued the FCC or MSOs for their "monopoly" control over cable Internet pricing? Put aside whether you agree or disagree with regard to how it would go... you have to admit, at least, that if no one prosecutes the matter, then nothing is going to change to make things better for consumers.

[rodi]

One difference between cable/telco solutions and wireless (cell or satellite) is the infrastructure... which is why franchises are typically awarded by the governing agency for the area... For example, I live in a Time Warner area of San Diego. Comcast is not allowed to dig up the streets and lay their own fiber. South of me is a Cox area... Time Warner is not allowed to operate there. Telco's also have a franchise arrangement... UVerse (ATT) is the only telco offering video services here... FIOS (Verizon) is not available.

Given the franchise nature of the wired solutions for internet and video - there is little competition.

As mentioned - trying to get even basic streaming over 4G LTE is challenging and likely to lead to lots of lag.

Time Warner (my MSO) adds insult to injury - offering services "up to" various speeds - but delivering far less (except in the middle of the night.

[supernova72]

I really want to "cut the cord" but still haven't figured out a way to watch our Seattle Mariners MLB local broadcasts in Seattle. That station here is called Root Sports Northwest. So here I am paying $175 a month for internet and HD TV with a DVR through Comcast/XFinity. Eek!

[RetireAge50]

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Originally Posted by supernova72 I really want to "cut the cord" but still haven't figured out a way to watch our Seattle Mariners MLB local broadcasts in Seattle. That station here is called Root Sports Northwest. So here I am paying $175 a month for internet and HD TV with a DVR through Comcast/XFinity. Eek!

Same here. Maybe this year it will be worth the money! Go Mariners!

[Texas Proud]

BUU,

I think your comparison with income has zero sway in what a consumer does when buying a service... so I think your argument has nothing to do with the subject...

I could care less how much I have in disposable income when I look at my cable bill... I look at it and think, wow, it has gone up almost 100% in the last few years... is it worth it to me to have it


BTW, there have been many talking heads on TV talking about how the young folks are not subscribing... and how the cable companies are trying to adjust to the new reality.... if we used your thinking, there is nothing wrong with the way they deliver their service and they should raise their rates even more... as you said, it is a bargain right now... but I think they know they would lose so many customers that they would have to be foolish to do so....

[bUU]

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Originally Posted by Texas Proud I think your comparison with income has zero sway in what a consumer does when buying a service... so I think your argument has nothing to do with the subject...

Please let me try to understand what you're saying: You feel that discretionary income has no impact on discretionary purchased. Fair enough. We'll have to agree to disagree about that.

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Originally Posted by Texas Proud I could care less how much I have in disposable income when I look at my cable bill...

An early retirement forum is rife with people who have so much financial security that they are able to think that way. To be honest, I suppose I'm in the same situation as you. My step-sister, by contrast, is not, and so she cares very much how much disposable income she has with regard to her cable bill (which, incidentally, she doesn't have, because of a lack of discretionary income).

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Originally Posted by Texas Proud BTW, there have been many talking heads on TV talking about how the young folks are not subscribing... and how the cable companies are trying to adjust to the new reality.... if we used your thinking, there is nothing wrong with the way they deliver their service and they should raise their rates even more... as you said, it is a bargain right now... but I think they know they would lose so many customers that they would have to be foolish to do so....

Yet they have recently raised rates here, so I think you're not considering the entire reality. You don't lower your rates on everyone because a portion of your target market is price sensitive. You make very careful choices, including, sometimes, sacrificing a portion of the market to keep the value of your offering higher with regard to the rest of the market.

[txtig]

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Originally Posted by supernova72 I really want to "cut the cord" but still haven't figured out a way to watch our Seattle Mariners MLB local broadcasts in Seattle. That station here is called Root Sports Northwest. So here I am paying $175 a month for internet and HD TV with a DVR through Comcast/XFinity. Eek!

Same here in Houston. If I cut the cord, I can replace all of the current content that I watch with OTA and streaming, except for the Astros and Rockets. Like you, we get these on Root Sports. The only option to get Root Sports is cable or satellite (U-Verse in my case). I can save about $100 per month by cutting the cord, so I may have to say adios to the 'Stros. It's looking like a tough year anyway.

Happy Cinco de Mayo!!!



Sent from my iPad using Early Retirement Forum

[Texas Proud]

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Originally Posted by bUU Please let me try to understand what you're saying: You feel that discretionary income has no impact on discretionary purchased. Fair enough. We'll have to agree to disagree about that. An early retirement forum is rife with people who have so much financial security that they are able to think that way. To be honest, I suppose I'm in the same situation as you. My step-sister, by contrast, is not, and so she cares very much how much disposable income she has with regard to her cable bill (which, incidentally, she doesn't have, because of a lack of discretionary income). Yet they have recently raised rates here, so I think you're not considering the entire reality. You don't lower your rates on everyone because a portion of your target market is price sensitive. You make very careful choices, including, sometimes, sacrificing a portion of the market to keep the value of your offering higher with regard to the rest of the market.

Some of the reason that cable bills have been raised is that the content provider is raising their rates... I have seen a number of times advertisements saying 'your (whatever) channel is about to be cut' due to the cable operator not wanting to pay us more money... it is not always that they want to have higher profits....

I get a ton of channels that I never watch and never want to watch.... they might be 25 cents each, heck, even 10 cents each (I do not think any are this cheap), but that is money that I would rather not spend if I did not have to....


About income... I am saying that having more discretionary income is not a good reason to spend more on a cable bill... IOW, more income does not equate to wanting to pay higher bills.... and that the higher bill is now a bargain because it is a smaller percent of your discretionary income...

A higher bill is just a higher bill... period...

[aja8888]

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Originally Posted by txtig Same here in Houston. If I cut the cord, I can replace all of the current content that I watch with OTA and streaming, except for the Astros and Rockets. Like you, we get these on Root Sports. The only option to get Root Sports is cable or satellite (U-Verse in my case). I can save about $100 per month by cutting the cord, so I may have to say adios to the 'Stros. It's looking like a tough year anyway. Happy Cinco de Mayo!!! Sent from my iPad using Early Retirement Forum

We are Astros and Rockets fans (forgive us) here on the north side and will go to a local sports bar to watch the games and have a bite to eat. Kills two birds with one stone, so to say.

DD has Sling TV for $20/month to get sports. I'm not sure if she can get the Root channel stuff though.

She has her Comcast bill down to $84/month with very basic TV and high speed internet. The rest is Netflix (shares my account) and free stuff. She is happy. If it wasn't for her boyfriend wanting to watch sports, she wouldn't have Sling.

She lives a few miles from us in a established subdivision and Comcast is the ONLY PROVIDER of cable services. Speak about a monopoly.