The most common reason so many households are kicking their cable TV habit is the cost. Cable bills keep soaring ever higher, yet millions of households still pay ridiculous costs each month for hundreds of channels they’ll never watch, endless hours of commercials, and contracts with hidden fees. Despite the fact that streaming video has become the new norm for millions of households, some people seem to hang on to their cable subscriptions no matter what the cost. According to new data collected by consumer research firm Leichtman Research Group, Inc. (LRG), the average cost households pay for cable is now up to $107 a month. How high will it go before more households decide to cut the cable for good?
The average cost of $107 a month is up 1% from last year, thanks in large part to increasing fees for things like regional sports licensing and taxes – fees which are often excluded from initial contracts and introductory pricing. While the 1% increase might not seem like much, the average price of cable has risen by over 50% since 2010, when cable bills were $71.24 a month at the time.
LRG’s data was gathered through a telephone survey of 1,152 households from throughout the United States. The research found that 78% of American households still subscribe to a paid TV subscription. That percentage is down from 86% in 2013, 87% in 2008, and 81% in 2004, but 78% is still a pretty high figure given how high cable costs continue to rise each year and how affordable streaming video services are in comparison.
Due to these ever-rising costs, more and more households are cutting the cable for good, taking advantage of streaming services that offer skinny bundles of popular channels at a fraction of the price, like Philo (starting at $16 a month) and Sling TV ($25+ a month). In a separate study, market research firm eMarketer found that the number of households cutting the cable has risen 32.8% this year. 33 million people are expected to cut the cable this year.
Still, the majority of households who hang on to their cable subscriptions say they do so because their internet and/or phone service is bundled along with pay TV. In some areas, particularly rural areas, these bundles are the only way to get high-speed internet or landline service.
Nevertheless, as more and more streaming services hit the market and the menu of cable cutting options with live TV continues to expand, it’s likely that the percentage of households cutting the cable once and for all will continue to rise. So why are cable companies continuing to raise prices in the face of a new competitor?