Americans love television, with American Idols, ballgames and talking-head news shows becoming integral parts of our lives. And television is relatively cheap entertainment, compared, for example, with attending many live events.
But spending on TV service needs to be examined like any other part of a household budget. Many families are easily spending $1,000 a year on TV service. For those on a tight budget, subscription television should be viewed as a luxury.
It's important to pay attention, because the landscape for television service is changing, possibly offering better deals. Last month, the Federal Communications Commission helped spur competition by requiring municipalities to make quick decisions on letting in new TV providers. Those competitors are telecommunications companies, including AT&T and Verizon Communications, which have been rolling out fiber-optic networks able to carry television signals.
That's good news for TV subscribers. The FCC found that prices charged in areas with competition were 17 percent lower than in regions with cable-TV monopolies.
So the television-delivery industry is changing fast and will continue to develop throughout this year, potentially leading to savings. Meanwhile, here are ideas for cutting subscription TV spending:
-- Go online
A major development in TV service is watching shows online, which allows you to pay a la carte for your favorite shows or watch them for free. Apple's iTunes, for example, offers the "Daily Show with Jon Stewart," "Lost," "CSI," "The Office" and "24" for about $2 an episode. Meanwhile, the nightly news, NBC's "Meet the Press" and other shows are available as free podcasts, although some contain only the audio. You also can go to the TV network Web sites to watch some full-length shows for free on your computer.
-- Tier drop
Don't buy more service than you need. If you don't have a digital or high-definition TV, the digital tier might not do much for you. If you mostly watch news shows and game shows, as opposed to movies and sports, a better picture might not matter as much. And consider that to get the digital tier you also have to rent a converter box for every TV on which you want to receive digital channels. That adds to the overall cost.
Check out the new and cheaper "family" tiers if you only subscribe to cable or satellite TV for the kids.
Call your service provider and say you want to cancel because it's too expensive. Listen to their offers to retain you as a customer. The representative may at least offer you a temporary deal, such as a reduced price for six months.
-- Buy bundles
Cable and phone service providers offer discounts when you subscribe to several services such as TV, Internet and phone service in a bundle. Just make sure you actually need and want all the services in the bundle.
-- Examine premium channels
You can pay a la carte for movies. Do that by renting DVDs at a store or by mail service, such as Netflix and Blockbuster Total Access, which charge a monthly fee. Or watch pay-per-view movies from your cable or satellite provider.
The exception is if you will definitely watch a lot of movies on the premium service every month. Find your break-even point. If Showtime costs an extra $20 a month but you can get pay-per-view movies for $4 each, you'll need to pay for five movies every month before Showtime becomes a better value, assuming you think the types of movies offered are similar.
-- Subscribe seasonally
It's easier than ever to add and subtract services, such as premium channels. If you love "The Sopranos," subscribe to HBO while the show is running, then cancel it. Or if you watch a lot of movies in the summer while network shows are in repeats, subscribe to a premium channel just during the summer months.
If you must have ESPN for college basketball, subscribe to a tier that offers ESPN only during the season.
Typically, there is no annual commitment for packages, giving you the flexibility to add and drop services to suit your seasonal viewing habits.
-- Use the premium secret
A little-known tactic for cheap TV is to subscribe to the most basic tier, which often costs less than $15 a month. It gives you all the broadcast network channels and a few others. Even less known is a federal law that gives consumers the right to purchase the cheapest cable package and add premium channels such as HBO, Showtime, Cinemax and Starz. It also allows lowest-tier subscribers to order pay-per-view movies.
Most cable companies don't advertise these options, hoping you will assume you need a higher tier of service to have premium channels. Be aware, however, that the cable company can require you to rent a set-top box to receive premium channels or pay-per-view. The federal rules, called "tier buy-through" or "basic plus premium," do not apply to satellite TV.
-- Try satellite
Satellite television service has been an option for years. But the price savings may be small depending on the package you order, and you'll need to install a satellite dish and buy a converter box for each television.
-- Cut the cord
Cancel your subscription TV and go with what you can get free, which now includes digital and HDTV programming. You can supplement broadcast offerings with DVD rentals of not only movies, but also previous TV seasons of shows. And don't forget your local library, which is a great source of free video entertainment.
Gregory Karp is a personal finance writer for The Morning Call, Allentown, Pa., a Tribune Co. newspaper. E-mail him at firstname.lastname@example.org. For additional discussion on spending wisely, see the Spending Smart blog at http://blogs.mcall.com/spendingsmart/.