The Dollar Rule vs. Cable TV
As the U.S. economy continues to degrade, many people are increasingly becoming aware that the much beloved cable (or satellite) TV really does take a chunk out of your budget each month. $70-90/month might not seem like a lot (especially when gas is $50 a tank), but it easily adds up to over $1000 at $90/mo (equivalent to a new laptop or large plasma TV each year for that). Even the most basic cable packages are usually $45-50 a month.
So let's apply the Dollar Rule to a $70/mo cable bill. $70 per month means we'd have to use the cable service for around 70 person-hours a month, or 2.3 person-hours per day on average, to reach the break-even DRR of 1.0. Using your cable for several hours a day probably isn't much of a stretch for most families, especially if you have kids. Even for single folks, a couple one-hour TV episodes would cover that relatively easily.
However, let's analyze things a little closer. If you tend to only watch network broadcast TV (i.e., the big 4: NBC, ABC, CBS, and Fox plus any local channels you have), you're not really making that much use of the cable service and technically we couldn't count those hours towards your 70 person-hours per month. If you subtract out the network shows, do you still reach 2.3 hours per day? If you rent or buy movies, they also take away from your cable TV usage. Then throw in video games, and that might further erode your cable TV time.
On the other hand, the built-in digital video recorders (DVRs) that many cable companies now integrate into their set-top boxes are a great convenience since they let you time-shift your TV watching and let's you do cool stuff like pause live TV and automatically recording shows for you. But you couldn't really count the time the DVR spends recording every episode of your favorite shows as actual "use" hours. You're not using it until you're actually watching it, at least in my view. But probably having all the shows recorded and waiting for you will make you more likely to watch them at some point.
So it's kind of a toss-up as to whether subscribing to cable TV is dollar-worthy. Plus, you may be getting your high-speed Internet service from the cable company as well, which might lower the cost of your TV service slightly.
But again, hitting a DRR of 1.0 is really just a minimum. It's like getting a "D" on your report card. Sure, you passed, but you could do a lot better. Personally, I don't like "D"s except when we're talking Dollars.
So that's why we decided to do what many others are doing now -- we cancelled our cable TV service.
Of course, then we had to go out and buy a TV antenna (good thing they still sell these). The cheap-o units didn't work very well, so we ended up with a $30 amplified antenna that does an okay job. Of course, since broadcast TV is switching to digital in 2009, we'll have to get a converter box. But you can get your $40 coupon towards a digital converter box and get it nearly free.
But as DR readers know, we also have a Nintendo Wii, which still easily replaces staring at the boob tube. And frankly not having the cable TV has not been that bad for most of us although we do miss some of the cool Food Network shows and some other channels. But frankly the loss of 500+ junk channels has been nothing but good. We already get our most timely news online anyway. Same for weather reports.
We also have one other "secret weapon" that makes losing the cable TV pretty painless. It's not for everyone, but it's certainly made up for losing cable. We'll talk about this in our next article.
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