When many of us move or live in an area that doesn’t exactly cater to HD antennas, we end up feeling stuck between a rock and a hard place. Even dedicated streaming fans need internet, which means dealing with whatever company they can find in their area. The local cable company charges as much for decent internet as they do for their minimum cable package, so people figure, “why not?” Then, after they’ve gotten into a comfortable groove with pricing, their bill suddenly starts to creep up. One day, they open that bill, and realize that they’re paying two or three times the original amount.
Believe it or not, this happens more than any of us like to admit. No one wants to feel like they’ve been duped by the fine print, and sucked into a contract that costs more than their mortgage to get out of. Unfortunately, this is the reality for many people, and a driving force behind the cord cutting movement. Let’s take a look at the anatomy of a cable bill.
The Monthly Package
This would be what you originally thought you were signing up for. A certain number of channels and a straightforward price point. What many consumers don’t realize is that this is only the promotional price. The company agrees to allow you to lock into a lower price as long as you’re willing to sign your entertainment life away for 12-24 months.
If you’ve ever been desperate for television and internet, then you know how easy it can be to fill out that form. It seems like a great deal…until that contract runs out. Welcome to the world of inflation. What started out as a $69.99 promo package is now locked in at $114.99. It’s been a year or two, and at this point you’re already invested. This is where cable companies can get tricky.
They don’t usually call you to renew your contract. Instead, each time you agree to a new piece of “necessary” equipment or make a change to your plan, the contract starts over again. Only, that promo price is long gone. Again, this will teach you to read the fine print. By the time you realize what’s going on, it’s too late.
Do you remember that “free preview” of HBO or Showtime that came on for a weekend? So many of us get hooked on a premium show and end up giving in to those add ons. Most of them aren’t horribly expensive, but as your favorite content becomes more and more segmented, those add ons add up. This can easily add $40.00 to each bill.
So far, the bill has hit $154.99/month.
Equipment and Services
This is the section of the bill that can get pretty puzzling. The average router sells for around $100.00, and the average standalone DVR is around $120.00. With a 24 month cable contract, the router is usually listed at $11.00/month. The DVR is around $10.00/month, and for some reason, the tiny receiver box to connect another television is nearly the same price as the DVR.
That’s an average cost of $264.00 for the router, $240.00 for the DVR, and an additional $240.00 for that tiny box that lets you watch television one room over. That’s an extra $31.00/month, and $372.00/year. By the end of that contract, IF you haven’t “upgraded” to new equipment, you will have paid $744.00 for equipment that cost $250.00 at best. That’s almost a 200% markup on equipment, and we all know that the extra money isn’t going to their fantastic customer service.
Now, we’re on the hook for $185.99/month.
Other charges? What else could they possibly squeeze you for? The “broadcast TV fee” and the “regional sports fee” are going to run $12.00/month. Apparently the cable package that included sports doesn’t quite cover that. That sports fee is what cable companies are tacking on to your bills to cover the cost that they’re paying for viewing access to certain sporting events in your area. Even if you don’t watch that sporting event, you’re now paying for it.
The broadcast TV fee is covering what the cable company is paying for broadcast access to certain channels. Because, apparently, those inflated package prices just weren’t cutting it.
We’re now up to $197.99/month.
Let’s Talk Late Fees, Service Charges, and Sales Tax
If you’re unfortunate enough to incur a late fee, you can expect to tack on an additional $10.00 to your bill. Last but not least, sales tax runs an average of $17.00/month, and the FCC regulatory fee will add a measly $0.06/month. Keep in mind that this doesn’t include any of the $20.00 movie purchases or $3.99-$5.99 movie or episode rental fees that can easily add double digit costs to your already inflated bill.
After everything is said and done, that initial $69.99/month promo package has now mutated into a checkbook scarring $225.04. The next time that you see someone claiming that the cost of cord cutting is comparable to cable, just remember how quickly the numbers can escalate. Last time I checked, Netflix hadn’t tacked on a “sports broadcast fee.”
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