Should You Cut the Cord on Your Cable Company?


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With cable television billing rates on the rise is now finally the time to severe the cord and make the leap to a streaming internet content provider? Who are the major players, what do they offer, and why should you consider making this move now. Get the answers to these questions and more inside.

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Should You Cut the Cord on Your Cable Company?

  1. 1. Should You Cut the Cord on Your Cable Company?
  2. 2. Cable TV is getting pricey… Rising Costs • In 2011 the average pay-TV package cost $86, including premium channels • By 2020, that cost is forecast to rise as high as $200 – Who can really afford to pay that much? Source: NPD Group,
  3. 3. Cable TV is getting pricey… The model’s broken! • Cable channel owners keep charging pay-TV companies more to carry their content • Pay-TV operators like Comcast, DirecTV, and Time Warner Cable pass that cost on to you!
  4. 4. The alternatives But you have a choice! • There are three big streaming video services today – Netflix – Amazon Instant Video/Prime Instant Video – Hulu/Hulu Plus
  5. 5. The alternatives What you’ll pay • Netflix: $7.99/month – Or $11.99/month if your family wants to watch more than two things at once • Amazon: $79/year for Prime membership ($39/year for college students) – Pay-per-view for content not available on Prime • Hulu: some content is free; Hulu Plus is $7.99/month
  6. 6. The alternatives They’re not the same! • Each has different strengths – Netflix: pay one price, large content library, original series – Amazon: pay-per-view and subscription offerings, large and growing content library, other perks – Hulu/Hulu Plus: free and subscription offerings, current TV shows Let’s take a look…
  7. 7. Netflix The streaming leader • Got its start mailing DVDs to customers’ homes • Created streaming video service in 2007 • Started offering standalone streaming service in late 2010
  8. 8. Netflix The streaming leader • More than 30 million U.S. subscribers • More than 40 million global subscribers Source: Netflix Q3 2013 shareholder letter
  9. 9. Netflix Top syndicated content • TV Shows – – – – – – Breaking Bad Family Guy How I Met Your Mother The Walking Dead Grey’s Anatomy Law & Order: SVU • Netflix also has a large collection of movies Source: CNET,
  10. 10. Netflix Netflix is also investing heavily in original content • House of Cards • Orange is the New Black • Arrested Development (4th season) • Lilyhammer • Hemlock Grove • Marco Polo
  11. 11. 2 services • Amazon Instant Video: more than 150,000 titles available to buy or rent • Prime Instant Video: more than 40,000 titles included with Prime membership – Prime members also get free 2-day shipping on most Amazon purchases Let’s focus on Prime Instant Video
  12. 12. Prime Instant Video Growing member base • “Tens of millions of members worldwide” – Amazon has never given firm Prime membership numbers • More than 1 million new sign-ups in the 3rd week of December – But many members don’t use Prime Instant Video Source: Dec. 26 press release,
  13. 13. Prime Instant Video Top Prime content • TV Shows – – – – – Downton Abbey Under the Dome Falling Skies SpongeBob SquarePants Dora the Explorer • Also includes a good selection of movies
  14. 14. Prime Instant Video Amazon is also testing original content • Alpha House • Betas • Tumbleaf
  15. 15. Hulu/Hulu Plus Old media meets the 21st century • Hulu is a joint venture of three big media companies – Comcast – 21st Century Fox – Disney • Hulu officially launched in 2008
  16. 16. Hulu/Hulu Plus Two models • Hulu is a free, ad-supported service – Primarily offers recent episodes of TV shows • Hulu Plus also has ads, but has 2 main advantages: – You can watch older episodes for many shows – Supports viewing on your TV through connected devices (for most shows) Hulu Plus now has more than 5 million members
  17. 17. Hulu/Hulu Plus Great for TV • More than 86,000 episodes across 2,900 TV series – Most top content comes from Hulu’s 3 owners • Not so good for movies… Source: Hulu blog,
  18. 18. Hulu/Hulu Plus Top shows • 7 of the top 10 primetime shows – – – – – – – Modern Family The Voice The Blacklist Agents of S.H.I.E.L.D. Scandal Grey’s Anatomy Sleepy Hollow
  19. 19. Hulu/Hulu Plus Original content • Hulu is also trying original content – The Awesomes – Behind the Mask – The Wrong Mans
  20. 20. Which is right for you? Strengths and weaknesses • Netflix: best original content; popular exclusives; user-friendly interface – Limited new release movie/current season TV content • Prime Instant Video: popular exclusives; integration with pay-perview service; lowest price – Limited new release movie/current season TV content; fewer originals • Hulu Plus: lots of current season TV shows – No way to avoid ads; few movies; some shows can only be watched on a computer
  21. 21. The Motley Fool’s Top Stock for 2014