How I cut the cable cord (and saved $5,000)

Each year, my wife and I have a “family summit.” It’s kinda this nerdy tradition where we have breakfast toward the beginning of the year and map out the year ahead. From a professional point of view. Personal. And financial.

And each year, when we discuss finances, one of my areas of focus is “where can we cut?” Like any great financial mind (can you sense the sarcasm here?), I’m always looking for ways to cut–and for ways we can bring in additional income. And each year, one area that just continues to bug the crap out of me is our DISH bill. It recently almost hit $100 a month. Ridiculous. Especially for a family that watches 5-7 cable channels at most (me, mostly the sports channels and my wife mostly “E” and 1-2 other channels).

So, I’ve been thinking about “cutting the cord” (or DISH, in this case) for a couple years now. Not to mention, the move would force us to read more and do more family activities (plus, I don’t want my kids to get hooked on watching too much TV).

This year, we finally pulled the trigger.

And, since I believe we’ll most likely see more of this–not less–in the years ahead with the proliferation of online content (Netflix, Hulu, etc.), I thought I’d share exactly “how” we did it. Mostly because it’s not a simple process at this point–and I don’t consider myself an expert by any means. In fact, I’ve relied on advice from people like Julio Ojeda-Zapata, Meghan Wilker and Matt Storlie along the way (thanks, guys!).

Here’s how we cut our “cable” cord:

Step #1 — We upgraded our TVs

We had one huge Sony tube TV in our basement, a 36-inch Sony tube TV on our main floor and a 32-inch in our bedroom. Got rid of all three (over the last year–in fact, the 36 inch is still in our family room; if you want it, it’s yours!) and bought a 46-inch Panasonic Plasma TV for our basement. A 37-inch LG LCD for our main floor. And a nice, little 32-inch Panasonic LCD for our bedroom. All with HDMI hook-ups. HD ready.

Step #2 — We got the right devices

Next, we needed the right devices to access content. That meant buying two Apple TVs to access all the iTunes content we wanted. Specifically, I was after not only movies and TV shows via iTunes, but also Netflix. On Netflix I’m currently getting caught up with Friday Night Lights, Breaking Bad and Mad Men. And, my kids love their shows, too. Phineas & Ferb. Angelina Ballerina. Shall I go on?

We also bought a fairly cheap Samsung Blu-Ray player for the basement. My theory? We need at least one device that gives us access to Hulu content (different shows than Netflix). And, it gave us a Blu-Ray player, which is nice. It does make a difference on the 46-inch Panasonic in the basement.

Step #3 — We purchased and installed the right antennae

I can’t take credit for this one. In fact, I got a little lucky. Since we live in the city, we had trouble getting a signal with an ordinary, indoor antennae. And, since I had no designs on getting on our roof and installing an antennae, I figured I’d have to hire that out. So, I posted a question on Facebook and former Minnesotan, Jared Roy helped me out with a tip. A couple weeks later, that installer was out sticking a powerful antennae on our roof. Best $100 I’ve spent in a while.

Step #4 — We figured out the right online content options to use

Our three primary sources of online content: iTunes, Netflix and Hulu. We’re not heavily invested in Hulu just yet, but I plan to purchase the Hulu Plus pass so we can watch a few other network shows. We used to have all our movies for the kids on DVDs, but since they scratch so easily, I’m going to move all that to iTunes. So, we’ll have all our movies digitally on our iMac. Forever. Or, until Apple goes belly up. We’ll use Netflix largely for the TV shows–like I said above, Friday Night Lights, Breaking Bad and Mad Men for now. I also use it to stream music during the day while I’m working from home. The movies still are less than stellar on Netflix but I’m hoping that improves down the road. The rest of our movies, we watch by renting Redbox movies at $1.29 a pop. We probably average one a week, so we’re looking at about $5 a month there. Grand total: About $20 a month for all our viewing content.

Step #5 — We started to think differently about our TV habits

The key to making this whole system work is changing your TV habits–or expectations. If you’re a “water cooler” viewer, this system isn’t for you. Sometimes, you don’t get to watch shows/events live. You have to wait. And, you need to be OK with that. You also need to be OK with basically not watching sports. No ESPN. I rely on my ESPN app on my iPhone/iPad a lot for updates on scores now. You really just have to readjust your TV expectations–that’s all.

How I saved $5,000

It doesn’t take a math wizard to figure out how I saved $5,000 (or, in this case, how I *will* save $5,000 in the next five years). First, the costs:

Initial costs:

$100 – antennae

$100 – antennae installation

Monthly costs:

$7 – Netflix streaming fee (monthly)

$5 – Average spent on Redbox rentals per month

$7 – Hulu Plus subscription (still considering this, but will probably pull the trigger soon)

Total: $200 start-up cost; $19 a month ongoing cost

Previous total cost: $100 a month ongoing

Savings per month: $81

Savings per year: $972

Savings per 5 years: $4,860

Money we will most likely stick in our kids college savings now. Thanks DISH!

Photo courtesy of jasoneppink via FlickR Creative Commons

32 comments
mecose
mecose

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Sports Preview
Sports Preview

This posting is marvelous and what a fantastic research that you have done. It has helped me a lot. thank you very much.

teaser38
teaser38

I'd have a spare PC or laptop to hook up.  Many cable networks have their shows available on their websites.  For instance, most of HGTV's content is available through their website, but no, at least yet, through set top box steaming.

joeldon
joeldon

Did I miss it?  You did not factor in your recurring monthly cost for Internet service which is the heart of your content streaming.  Also, unless you live "in range" of a major metropolitan node, the antenna solution won't pull in HD channels for most of suburbia.  And when your internet provider starts charging you by the gigabyte, Netflix streaming will not be the bargain that it is today.  It's coming; see what Time-Warner is test marketing in some markets.  The cable and DSL companies are not ignoring your solution.  You are still using their pipe, and they already charge a premium for Internet-only customers.

OtherWaysToWatch
OtherWaysToWatch

Great how to post! Cord cutting is definitely becoming more prolific and its exciting to see how each person does it. What do you think of the new Apple TV interface?

Patti76
Patti76

My solution:  A Mohu Leaf indoor antenna ($36-$40,excellent pictures), a Tivo Premiere box ($65, check ebay or Amazon, then $20 a month for the service) to record my OTA signals and watch at my convenience, Amazon Prime ($79 per year or $6.60 a month) and Hulu Plus ($8 per month) memberships and a Roku LT box ($50).  Initial Cost $153.  Monthly cost under $35.  My cable bill was $65 per month and I was already paying for  Prime and Netflix (xld in favor of Hulu Plus for access to cable TV shows) memberships so my cost has been reduced by $45 per month or $540 a year.  There are a few cable shows I'm doing without, but have found I really don't miss them.  Out of sight, out of mind and well worth the savings!

Greg4Vegas
Greg4Vegas

Margaret and I got rid of cable TV last year. We watch what we want via Internet, and don't miss cable TV. We walk more, talk more and do more now in the evenings and on weekends. One suggestion - we reserve DVD movies for free at the local public library, and only rarely rent from Redbox. 

bvincent
bvincent

@arikhanson excellent post. $5k is a pretty great number. I'm ready to do the same.

BridgetMonroe
BridgetMonroe

@arikhanson Upgraded to an HD TV recently so we could cut basic cable. Haven't had "real" cable for six years. Not missing a thing.

mamodeo
mamodeo

Arik, we also rely on our Apple TV and a Netflix/iTunes combo but haven't cut the cord because we're addicted to high speed Internet service -- and it comes packaged with the "cable tv" content.  What do you do for Internet?

ryanmathre
ryanmathre

Good post Arik. My only deterrent in cutting the cord is live sports but with two young kids I hardly have time to watch games as it is plus the most pro sports (short of NFL which are nearly all on networks anyway) offer decent season packages via streaming devices. 

 

I think I'll be joining the club this summer....

JohnNemoPR
JohnNemoPR

Arik enjoyed the post - we live on AppleTV and Netflix too, and also with over the air TV. And rent movies on iTunes or Redbox. Only thing my kids wish we had is FSN for sports, but I actually like reducing the sports watching to highlights via the various iPad/iPhone Apps for each sport. Saves time and you get the best plays of the game anyway! ;)

apearson
apearson

@arikhanson I don't think I could give up Twins baseball :-( #cutthecord

nicolenavratil
nicolenavratil

@arikhanson Great post, Arik. We haven't had cable or TV for 3 years and love it. We have a PS3 for Netflix and Bluray and it's all we need.

DanielHonigman
DanielHonigman

Also, what are you doing about sports? Are you using a premium streaming service?

DanielHonigman
DanielHonigman

What are you pulling in from that antenna? Basic channels (2, 4, 5, 7 etc)?

DaisyMaeDesign
DaisyMaeDesign

@arikhanson Great blog post! Really enjoyed it. 1 thing: what about the cost of all those new TVs?

arikhanson
arikhanson moderator

 @joeldon Yeah, but I was already buying that. I need that anyway--it wasn't an add-on. And, I know they'll figure it out eventually, but Netflix and other companies like them, will adapt, too. I can't plan based on what I think Comcast will do five years from now. I'm reacting to what I see as viable options right now. I'm sure things will change, but for now, it's working. And eventually, I could probably live without the Netflix. So far, we're using it less than I thought.

arikhanson
arikhanson moderator

 @mamodeo We get our high-speed thru Qwest, so we weren't locked into Comcast in our neighborhood. We also have city-based Wi-Fi here, which was another option.

arikhanson
arikhanson moderator

 @ryanmathre Once MLB figures out its deal, we should get Twins access (fingers crossed). FSN is probably a lost cause. Sports is the drawback no question. But, I'm learning to live without it. And, I'm surviving ;)

arikhanson
arikhanson

@nicolenavratil Gotta love Netflix, even if it doesn't have the best movies

Patti76
Patti76

I am using a Mohu Leaf.  I live in the greater Los Angeles so I get more than just the basic channels (my guess is over 30).  So I would say it depends on where you live.  One way to find out is by going to http://transition.fcc.gov/mb/engineering/maps/ and entering your zip code.  You'll get an idea of what channels you can get with an antenna.

arikhanson
arikhanson moderator

 @DanielHonigman Yep--more than that, but basically, yes. HD channels, to be exact. And, they're crystal clear, which is unlike our DISH experience.

arikhanson
arikhanson

@DaisyMaeDesign Yeah, should have included those. Wasn't all that spendy though, really. Needed an upgrade desperately.

nicolenavratil
nicolenavratil

@arikhanson Yeah, we've been busying ourselves getting caught up on all the (new-to-us) Family Guy episodes. :)