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Will cable TV ever get cheaper?

With so many people cutting the cord, you'd think cable TV would now cost less, not more. But experts say that's not likely.

By MSN Money Partner Jun 14, 2012 9:23AM

This post comes from Quentin Fottrell at partner site SmartMoney.


SmartMoney on MSN MoneyWhile the fierce competition between cable companies and online video services should be good for consumers, experts say it may end up raising both TV and Internet bills.


Image: Watching television (© Corbis)The Justice Department is conducting a wide-ranging antitrust probe into whether cable companies collude to restrict competition from online video providers like Netflix, The Wall Street Journal reports. At issue: Cable companies want to cap data downloads among heavy users, which would affect those who've abandoned pay TV in favor of streaming shows and movies over the Internet.


Though more people have "cut the cord" in recent years, analysts say it hasn't resulted in the price cuts many expected. "Cable prices won't go down unless cable investors get hurt, and that will only happen when even more customers cancel their cable," says technology analyst Jeff Kagan.


Some 9% of homes with televisions cut their cable services in 2011, while an additional 11% said they planned to do so, a survey released by Deloitte earlier this year found. (Post continues below.)


But despite this, cable prices doubled over the past decade, Kagan says. Customers have been complaining about price increases for years, he adds. "This is backwards compared to other technologies, but cable television pricing continues to go up," he says.


And prices may double again in the next decade. Keith Nissen, research director at NPD Group, predicts bills will hit $200 a month by 2020 -- up from the current average of $86.


In light of the Justice Department's investigation, cable companies may look for other ways to maintain their revenue and market share, experts say. One option: Do what cellular networks are doing and move toward usage-based pricing for broadband Internet, says Craig Moffett, senior analyst at Bernstein Research.


The shift to usage-based pricing would be good for the cable operators, but bad for consumers who want to watch more on-demand television online, he says. This would also slow the pace of innovation within the industry, he says, and make it more difficult for Apple or Google TVs to get widespread and cost-effective access to cable video feeds.


TV and cable networks also have no interest in lower prices, experts say. "The companies are caught in the middle and have to pay more year after year to networks," says Kagan. (Netflix, Time Warner and Comcast did not respond to requests for comment.) 

Cable companies have also responded to the competition with their own new tech offerings, such as apps that allow viewers to watch TV on multiple devices and video-on-demand, says Brian Dietz, a spokesman for the National Cable & Telecommunications Association.


Google and Apple -- which both have streaming video offerings -- may be in the best position to upset the status quo. "These two companies changed the wireless space," Kagan says. "Perhaps they can change the television space as well."


More on SmartMoney and MSN Money:

174Comments
Jun 15, 2012 3:10PM
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It's amazing how I get sold on cable for $49.99 and I get the bill and it's $85+. Amazing...
Jun 14, 2012 3:22PM
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I remember when free tv was free because you had to watch comercials.  Cable tv was touted as being commercial free.  Now since there are abundant commercials on cable, why isn't it really cheap?  Time to cut the cable. 
Jun 14, 2012 5:48PM
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In its infancy, the whole selling point of pay tv was no commercials. WTF happened?
Jun 15, 2012 7:32PM
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I'm in my 70's and remember when 'cable' started, it was called 'Pay TV' then and the whole concept behind it was with the consumer paying a fee, the service was commercial free...  that's what I said folks... there were NO COMMERCIALS when 'Pay TV' started out. Consumers bought into it because the 'free' channels had so many commercials, but like all good things that must come to an end, the money grubbers got there hands on it and the rest is history.... The moral of the story is no matter who comes up with a commercial free anything, don't believe it and if you do. I happen to know of a bridge for sale in Brooklyn.. LOL

Semper Fi

Jun 14, 2012 6:02PM
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Stopped watching T.V. years ago. I am beyond sick of paying only to be forced to watch commercials for 1/3 of the time (more for some channels). Not to mention that channels hardly ever present anything entertaining, let alone informative.

Of the many scams which nobody seems to be aware of, like the absurd cost of prescription glasses, cable has to be among the top.
Jun 14, 2012 9:23PM
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I'll go back to cable when I can choose the 4 channels I want instead of their 55 channel "special" that includes 6 shopping channels, 10 mexican channels, 8 preaching channels and 14 kids channels.  I dont miss commercials every 5 minutes either.
Jun 15, 2012 10:29PM
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I worked for a contractor doing Comcast work; we would get mostly their lower paying, dirty jobs. We also had to hurry through jobs cause they only give a few dollars for certain tasks. The company doesn't seem to want to pay a decent wage for more techs so they use contractors. I am  sure they would deny it and spin the story differently, but this is the truth. Comcast is charging you more while paying the workers less and  less.
Jun 15, 2012 11:18AM
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Cable companies need to set up "a la carte" TV.  For so much you get all the local channels plus 25 of your choice, or 50 of your choice, etc, etc.  I am Sick of paying all this money and I watch possibly 10 channels.  The rest is all garbage.  AND, I'm sorry, not bigoted, but I don't speak Spanish and shouldn't have to pay for those channels.  I should be able to have the option to replace them with English channels.  Hulu Plus may be the way to go.
Jun 14, 2012 2:04PM
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When I was a kid (I'm 58 now) my Dad talked about cable TV (or pay TV). The upside to paying for what we were used to getting for free was supposed to be that there would be no commercials. Now we have pay TV, and have even more commercials than broadcast TV. We will be getting rid of our satellite (Direct TV) as soon as the contract expires.
Jun 15, 2012 9:35AM
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I have TV Antenna and get all major networks for FREE!!  People should just get back to basics and tell the cable companies to well take a long walk off a short peir.

 

They are robing you blind when you think what you can buy with 80-100.00 a month.  1,200.00 a year!!

 

They are keeping you poor, by your choice.  Food for thought.

Jun 15, 2012 7:45AM
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The problem is not only high prices but the customer is forced to pay for channels they never ever watch. My cable "package" includes, music, latin, shopping channels numbering over 50 that I would never ever watch. It needs to go al la carte or I will never have cable or even satellite again. Why should I be forced to pay for channles I do NOT want?
Jun 14, 2012 5:43PM
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When I cut my cable tv Comcast raised my internet bill $20 because I wasn't bundling anymore. Only with the cable companies does less cost more.  
Jun 15, 2012 9:53AM
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If I had the choice I would eliminate 80 % of the channels . The cable companies make you take all the garbage channels you don't want.
Jun 14, 2012 4:48PM
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"Until we get the option of a la carte pricing, and can pick the channels we want, nothing will change."

 

Exactly, Dave. If the feds really want to act in consumers' best interests, they will madate that cable companies make a la carte subscribing an option.  The cable monopolies insist it's impossible, but I don't believe that for a second.

Jun 14, 2012 4:12PM
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Cable has become such crap.. When cable and dish units first came out they were adds free. Thats what we paid for. Every other station was free.. Now all shows are extended out 2 or 3 times longer then it should ever be.. We pay $240 per month to Comcast with internet and home phone and it is a big a$$ rip off....  Cable can kiss my sweet old A$$ and FU*K OFF (sorry folks just needed to vent)
Jun 15, 2012 3:20PM
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Cable companies and satellite providers are essentially monopolies and will continue to rape the public until a reliable alternative is found- but since they ARE monopolies, they cut the throat of anyone who interferes. I would be willing to provide an affordable cable plan- but the Big Boys already own the airwaves and they're not going away and they're not going to let ANYONE  competitive into the ballgame. They're some of the most lucrative businesses with a very low upkeep cost. Even though the American taxpayers own the airwaves and provide the satellites, the insiders with political pull will continue to rule - and charge whatever they want, and we can't do a damn thing about it except go without. AND ON TOP OF THAT- they decide what channels  you get instead what you want. I am tired of paying for QVC and the spanish channels.
Jun 15, 2012 7:40PM
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where i live i can get about 12 channels over the air with just a pair of rabbit ears, including the major networks.  also can watch movies on HULU.  i do miss ESPN, but can't afford even the basic packages starting at $50/month just to watch sports.  sucks that MNF is now on ESPN, so we have to pay to watch it...with the commercials.   even when i graduated from college i could barely afford cable, so i only had it during football season, didn't miss cable the rest of the year.  boggles my mind we continue to pay to watch TV when it's all crap reality shows. 

 

 

Jun 14, 2012 9:22PM
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We fired our satellite tv provider after 10 years;due to the price going up constantly. Luckily although we live in the country WISP Internet is available, so we stream over 10,000 movies/tv shows w/o ANY ads via Amazon Prime membership...$79/year averages $6.58/month! Also I put up a $39.00 Channelmaster outdoor antenna mounted on the old J-arm satellite mount to get locals too. Hulu Plus, Amazon Prime, Netflix = death of cable & satellite providers. Goood riddance!!
Jun 18, 2012 9:52PM
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The price of cable is insane, but what gets me is that I can't pick and choose what channels I pay for.  I do not feel the need to pay for channels, such as the foreign speaking channels, that I do not watch.  Cable should be a la carte.  Let me pick and choose and then charge accordingly.
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