Steep cable price hikes could soon make cord-cutting a reality - KCTV5

POLL

Steep cable price hikes could soon make cord-cutting a reality

Posted: Updated:
When consumers were asked which service they would cut first if they had to save money, a whopping 76% said they would get rid of their pay-TV service.  (CNN) When consumers were asked which service they would cut first if they had to save money, a whopping 76% said they would get rid of their pay-TV service. (CNN)
NEW YORK (CNNMoney) -

Cable subscribers are as mad as hell, and maybe -- just maybe -- they finally aren't going to take it anymore.

To consumers, it can feel like bills for cable, Internet and wireless just keep going up. And they're right, according to a recent report from Macquarie Capital analyst Kevin Smithen.

The cost of those "triple-play" services has jumped about 6.3% on an annual basis for the past three years, a time when overall inflation was running barely 2%.

Compounded, those three years of price hikes have added up to a scary amount of money. Smithen's research showed the bill for triple-play jumped an incredible 20%, or about $46, since 2010, to a current average of more than $273 per month. Those rapid rate hikes are "unsustainable in the long run," Smithen wrote.

Those price hikes are at the core of a recent slew of major disputes between cable companies and broadcasters. Last week, CBS blacked out its channel for Time Warner Cable customers after the cable provider refused to meet the broadcaster's rate increase demands.

It's very clear where consumers are drawing the line.

When Macquarie asked consumers which service they would cut first if they had to save money, a whopping 76% said they would get rid of their pay-TV service. The remaining 24% were split evenly between broadband Internet and wireless phone service.

Ian Olgeirson, a telecom analyst for SNL Kagan, isn't surprised that pay-TV was the overwhelming winner (or loser, depending on how you look at it).

"[Cable] is really the perfect lightning rod for consumer dissatisfaction," Olgeirson said. "It's the biggest part of your bill and the most consistent rate increase."

Plus, he added, it's tougher to replace your cell phone or Internet provider than it is to find an alternative for pay-TV, which faces a long list of semi-competitors: Netflix, Hulu, Amazon and many more. But he's not convinced they'll become "a significant threat to the [cable] subscriber base" over the long term.

"What's not there is all the content -- the newly aired shows, the sports, the live events," he said. "Content stands to stay in the environment willing to pay for it, and for the foreseeable future, that's the pay-TV industry."

Even Smithen, the Macquarie analyst, stopped short of making "a bold call on cord cutting over any specific period of time." But with such steep price hikes, the tipping point for widespread cord-cutting may be closer than ever.

Article on CNN.com

CNN © 2013 Cable News Network.Turner Broadcasting System, Inc. All Rights Reserved.
  • What would you do to save?

  • Thank you for participating in our poll. Here are the results so far:

    Cancel my cable TV
    65%
    221 votes
    Clip coupons
    1%
    4 votes
    Take a second job
    1%
    2 votes
    Cancel my Internet access
    2%
    6 votes
    Cutting back on eating out
    10%
    34 votes
    All of the above
    21%
    69 votes
  • Most Popular StoriesMost Popular StoriesMore>>

  • Missouri man charged with felony after alleged racial slur

    Missouri man charged with felony after alleged racial slur

    Thursday, January 29 2015 11:44 PM EST2015-01-30 04:44:07 GMT
    A 65-year-old Maryville man is charged with felony assault after he allegedly confronted a black server as she served him breakfast. The man is accused of assaulting her and using racially insensitive language.More >
    A 65-year-old Maryville man is charged with felony assault after he allegedly confronted a black server as she served him breakfast. The man is accused of assaulting her and using racially insensitive language. More >
  • Man, woman charged after beating, kidnapping person at Grandview park

    Man, woman charged after beating, kidnapping person at Grandview park

    Friday, May 26 2017 11:54 AM EDT2017-05-26 15:54:37 GMT
    Zane Warner, 21, and Hana Yocom, 19, have each been charged with one count of felony kidnapping and one count of felony armed criminal action. (Jackson County Detention Center)Zane Warner, 21, and Hana Yocom, 19, have each been charged with one count of felony kidnapping and one count of felony armed criminal action. (Jackson County Detention Center)

    Authorities in Jackson County have charged a man and a woman after a person was kidnapped from a park on Wednesday.

    More >

    Authorities in Jackson County have charged a man and a woman after a person was kidnapped from a park on Wednesday.

    More >
  • Teachers name 7th grader ‘most likely to become a terrorist’

    Teachers name 7th grader ‘most likely to become a terrorist’

    Friday, May 26 2017 10:18 AM EDT2017-05-26 14:18:53 GMT
    (Source: Click2Houston via CNN)(Source: Click2Houston via CNN)

    A group of teachers are being disciplined after they thought it would be funny to name a student “most likely to become a terrorist.”

    More >

    A group of teachers are being disciplined after they thought it would be funny to name a student “most likely to become a terrorist.”

    More >
Powered by Frankly
KCTV 5 News

Online Public File:
KCTV  KSMO

Powered by WorldNow CNN
All content © 2017, KCTV; Kansas City, MO. (A Meredith Corporation Station) . All Rights Reserved.
For more information on this site, please read our Privacy Policy, and Terms of Service, and Ad Choices.