In the good old days of 2007, when Netflix rolled out its streaming service, it was nothing short of revolutionary. U.S. Netflix subscribers, who were shelling out a monthly fee between $5.99 and $17.99 for DVD rentals, suddenly found themselves blessed with access to 1,000 movies via their web browsers. Forget waiting for DVDs to arrive in your mailbox or enduring television commercials—just click and start watching. But oh, how times have changed. Today, Netflix’s top-tier 4K plan has soared to $23 a month, and even its basic, ad-free package is priced at $15.49 monthly. Want the budget plan with ads? That’s $6.99 a month, and it comes with strings attached: no offline viewing and limited content.
Adding fuel to the fire, Netflix has recently cracked down on account sharing. Great for its bottom line, sure, but a real bummer for thrifty consumers. Now, adding more profiles to either the standard or premium plans will set you back an extra $7.99 monthly.
But don’t just blame Netflix. Practically every streaming service in town has hiked up their prices lately. Apple TV+ has shot up to $10 monthly (or $99 annually), while Disney+ increased its no-ad premium tier to $14 a month. If you’re subscribed to multiple platforms, it’s enough to make you feel like you’re trapped in a cable TV nightmare, hemorrhaging money for countless channels.
Before we start pointing fingers and panicking, let’s put things into perspective. Even with these increases, streaming services are still a more economical choice compared to traditional cable packages. Take Comcast, for example. Their popular 125+ channel plan advertises a cost of $60 a month, but when you add in hidden fees like a $27.80 broadcast network charge and a $13.40 sports license fee, the real monthly cost jumps to $101.20—and that doesn’t even include taxes and additional equipment costs. Want cloud DVR? Cough up another $20 monthly.
Contrast that with the Bureau of Labor Statistics’ report that the average city-dweller forks over an astonishing $575 monthly for cable, satellite, or live streaming. Sure, some folks might be going all out with sports packages and whatnot, but even thinking about the 2010 average of $370 for cable alone is mind-boggling. When you look at it that way, Netflix edging closer to $25 seems like a small price to pay—especially when you consider that cable users also need to subscribe to streaming services to access original content.
So, is the dream of cord-cutting over? Far from it. Cable was never a cheap alternative to begin with, and its prices have only skyrocketed. Streaming services, with their wide array of content, offer a compelling alternative. Do you really need to pay a small fortune just to binge on another HGTV series when you can find similar content across streaming platforms?
Yes, it’s frustrating to see streaming platforms engage in what Corey Doctorow terms “internet enshittification”—the practice of initially offering a cheap, quality service only to later downgrade the experience to extract more profit. But we have to remember that streaming services were initially underpriced as part of an experiment to attract users. Netflix was a prime example, running as an inexpensive addition to their DVD rental service before becoming a standalone feature in 2010 at just $7.99 monthly.
But why were these platforms so affordable? Netflix had a leg up since it was funded by its lucrative DVD rental business. This enabled the company to raise substantial funds (around $5 billion) to produce original content without worrying too much about profitability. Other companies like Disney and Warner Bros. had a trickier time figuring out where streaming fit into their existing business models.
However, when Netflix reported a drop in subscribers in 2022—first by 200,000 in Q1 and then by a whopping million in Q2—it was a game-changer for the streaming world. Layoffs, content cancellations, and new revenue strategies were suddenly the order of the day.
With economic concerns and increasing interest rates, streaming services had little choice but to up their prices. Don’t expect them to roll back these hikes anytime soon. The best-case scenario? The fear of subscriber loss and market competition will keep them from reaching the astronomical prices of cable TV.
Remember, one advantage streaming has over cable is ease of subscription management. With a few clicks, you can unsubscribe, sparing you the hassle of negotiating with a customer service agent or waiting for a technician to show up at your doorstep.
While streaming services are inching up in price, let’s not forget they are still a bargain compared to the era of Blockbuster rentals and late fees. So yes, it’s disappointing to see Netflix and others raising their rates. But if you ask me, I’ll take the era of streaming over the days of physical media and cable packages any day.
Frequently Asked Questions (FAQs) about Streaming Services Cost Comparison
What is the main point of the article?
The article explores whether subscribing to streaming services like Netflix, Apple TV+, and Disney+ still offers value compared to traditional cable TV, especially in light of recent price hikes. It argues that despite the increases, streaming services remain a more cost-effective and flexible option.
How have the costs of streaming services changed over time?
Initially, streaming services were relatively cheap. For instance, Netflix’s streaming service was first introduced as an addition to its DVD rental service and later became a standalone feature costing $7.99 a month in 2010. However, prices have gradually increased, with Netflix’s premium plan now costing $23 a month.
Why are streaming services increasing their prices?
Streaming services are raising prices due to a variety of factors, including the need to fund original content and the pressures of sustaining a profitable business model. Economic concerns and rising interest rates have also contributed to the trend.
How do streaming service costs compare to traditional cable?
Even with recent price increases, streaming services generally offer a cheaper alternative to traditional cable packages. The article cites that Comcast’s most popular plan, when accounting for hidden fees, actually costs around $101.20 per month, not including additional taxes and equipment fees.
What is “internet enshittification”?
The term “internet enshittification,” coined by Corey Doctorow, refers to the practice where companies initially offer affordable and quality services to attract a large user base, only to degrade the service quality later to maximize profits.
Is the dream of cord-cutting dead?
No, the article argues that the dream of cord-cutting is still very much alive. Despite price hikes in streaming services, they remain a more economical and flexible option than traditional cable, which has also seen its own set of price increases over the years.
What advantages do streaming services have over cable?
Streaming services offer a wealth of content options and the flexibility to subscribe or unsubscribe with ease, without the need for complicated interactions with customer service or waiting for technicians.
Are streaming services expected to decrease their prices anytime soon?
The article suggests that it’s unlikely for streaming services to roll back their price increases in the near future. However, the competitive landscape and the threat of losing subscribers could act as a check on how high prices can go.
More about Streaming Services Cost Comparison
- Netflix Pricing Plans
- Apple TV+ Pricing
- Disney+ Pricing
- Comcast Cable Plans
- Bureau of Labor Statistics on Cable Costs
- Lowpass Newsletter by Janko Roettgers
- Corey Doctorow on Internet Enshittification
- BuyTechBlog Podcast
- Cord-Cutting Trends
- Lucasfilm and Streaming
- Interest Rates and Their Impact on Streaming