A few years ago, I went to a social event at a friend’s house.  At the time he was employed in a tech sales position at one of the major tech firms.  I noticed all kinds of wires and devices connected to his TV in the living room. 

When I inquired he proceeded to tell me he had “cut the cord” from the cable company, and was able to replicate the service for a lower price.  He proceeded to show me, a digital antenna to get broadcast channels, a DVR to record programs, and some sort of router that made all of this available to all the TV’s throughout the house.

It all seemed so complex at the time, but he was one of those guys who could make it work and troubleshoot when necessary.  I do remember his savings were notable however.  It seemed cool, but at the time it was a tech mountain I wasn’t ready to climb.

Cutting the cord has become more of a thing in recent years.  Some of it was the young people who had no interest in linear TV, and were happy with Netflix and chill.  Others got tired of subsidizing hundreds of channels they mostly didn’t watch, especially expensive local and national sports channels which were must carry on basic cable and added notable cost to the monthly bill.  Who do you think pays for the multi-million dollar salaries of the players on the local NBA team?

In recent years I had watched the cost of my cable bill increase notably, probably a good 75 percent since the pandemic started.  Recently, the cable company instituted data caps on my internet service.  This meant I could buy up to a higher service level month in and month out, or pay an even higher penalty fee in months I pierced the cap.  Something had to give.

I started to dig.  First I found a few streaming services that were able to deliver the channels we most watched and the local ones (no antenna needed) on any TV in the house without the need for additional equipment rental, for a stunningly lower price.  That sounded great, but I looked into the cost of internet service only from the cable company and it seemed they had you. 

Or did they?  The old traditional phone company did not offer fiber optic service where I live.  Their DSL offering just won’t cut it in the 21^st century.  I thought I was screwed.  But then I came across an ad for one of the cell phone carriers offering 5G service for the home.  I learned for that to work well, you need to be somewhat near the tower – 5G has limited range, and that tower can’t be oversubscribed.  They offered a free trial, so I took them up on it.  I ended up with great service and speed.

Now I have cut the cord.  I have everything I want for about half the price.  There is a lesson here.  Competition works for the consumer.  As long as we don’t allow monopolies, the invisible hand of economics works.

If you haven’t cut the cord, you might want to check it out.  Just don’t sign up for my tower.

The Bottom Line:  Believe in and take advantage of free markets.

–Michael Ross, CFP®