Money Minute: $200 cable bills? Seriously? [Video]


OK, take a deep breath. Find your happy place. Now try this on for size: $200 monthly cable bills.

That’s the prediction from market researcher NPD Group, which says cable bills of that wallet-busting magnitude could arrive by 2020.

“As pay-TV costs rise and consumers’ spending power stays flat, the traditional affiliate-fee business model for pay-TV companies appears to be unsustainable in the long term,” says Keith Nissen, research director for the firm.


Households now get smacked with average cable bills of $86 a month, NPD says. That’s just for basic and premium channels, and doesn’t include phone or Internet service.

By 2015, the firm says, average bills will top $123. And by 2020, $200.

Why? Blame the never-ending tussles between cable operators and program creators over how much money should be changing hands. This results in cable bills rising by as much as three times the rate of inflation year after year.

Here’s the thing: The typical TV viewer watches only about 17 channels on a regular basis, meaning that we pay for literally hundreds of channels that we never watch. Clearly it’s time that the cable industry stopped gouging us for products we neither want nor use.

It’s time for a la carte pricing -- that is, paying only for the channels you want. Obviously this would cause significant change in the TV industry and probably cause some lesser-watched channels to fall by the wayside.

But the market should have it’s say, rather than industry players dictating terms to customers.

Unless, that is, you think paying $2,400 a year for TV is a reasonable price.