Options for cord-cutters as prices keep going up
For the growing ranks of cord-cutters who fled cableand satellite-TV services for cheaper streaming options, recent weeks have brought an unsettling run: rate increases that look too much like the price hikes that plagued traditional pay-TV for years.
First, the Dish Networkowned Sling TV announced at the end of June that its entrylevel Sling Orange service would increase by $5 to $25. Days later, AT&T was notifying subscribers to its DirecTV Now that its three tiers of service would also go up by $5 a month, raising its starter rate to $40. And Sony PlayStation Vue said it, too, would increase rates by $5 a month to bring its cheapest plan to $40.
Google’s YouTube TV, in turn, had led off this mini-trend in March with a $5 increase that brought its standard rate to, yup, $40.
It’s true that online streaming operations face the same underlying inflation from studios and networks as cable and satellite.
“Costs for content producers and networks continue to rise faster than the general inflation rate,” said Brett Sappington, senior director of research, Parks Associates, in an e-mail interview. “As long as that happens, they will face pressure to increase the amounts that they need from their distributors to cover those costs.”
He noted that online services – often called “over-thetop” services because of how they arrive on another company’s broadband connection – themselves contribute to some of this inflation with motion picture-level budgets for some exclusive series.
“Netflix and other OTT video services are spending big on original series,” he said. “As a result, the bar has been raised for broadcasters and networks in spending and quality.”
But subscribers to online services remain better-positioned to resist this rate creep than those with cable- or satellite-TV bills; they have more options to replace almost all of a traditional pay-TV bundle: DirecTV Now, PlayStation Vue, YouTube TV, Sling TV, fuboTV and Hulu’s live-TV option.
They may now all charge about $40 a month. But you still have multiple options if any one decides to push through another hike.
You could get a cheaper online service that omits some of the most expensive sports channels. Philo, for instance, starts at just $16 a month if you can live without ESPN, while fuboTV offers an extensive array of more than 105 channels, including many non-ESPN sports channels, for $44.99.
If you have good over-theair reception of local stations, you can buy an antenna and drop online options for broadcast TV. That could let you stick with Sling’s $25 Orange plan instead of upgrading to its $40 Orange + Blue bundle, for instance.
Rob Pegoraro is a tech writer based out of Washington, D.C. Email Rob at rob@robpegoraro.com. Follow him on Twitter at twitter.com/robpegoraro.