INTERNET

Why The Internet Is So Costly Compared To Cable/Digital Tv Services?

Pay-TV has had a difficult few years, with subscriber numbers at all-time lows, new competition popping up everywhere, and mobile devices taking over the traditional role of the television. Despite this constant roller coaster ride of cable TV over 90 million households in the United States still pay for cable or satellite, compared to roughly 55 million Netflix customers.

Of course, the prime most reason for keeping the cable is the ability to view live broadcast channels is one reason why people keep pay-TV, and some keep cable because it’s combined with their home internet service. We can also not undermine the rise of the value of customer services for telecommunication services. For instance, CenturyLink internet español users know that they have several channels to reach out to the company during any need for assistance. This is yet to be found for any streaming services.

Nevertheless, one thing it all comes down to is the pricing of the internet and why even to this day are so costly and why they do not seem to be heading down anytime soon either. There are several reasons for this, so without any further ado, let’s calm this tickle in your brain down that why the internet is so costly compared to cable/digital TV services even to this day.

Pricing Models

We commonly see that bundling home phone, internet, and pay-TV into a single service is frequently less expensive than purchasing them separately. This echoes the pricing strategy that has allowed telecom firms to make billions of dollars for decades. Pay-TV packages are costly for your cable or satellite provider to supply because they must license material from content owners, and channel rates have been steadily rising year after year.

Artificial Cost

Once you have your network, providing Internet is a low-cost service. That’s how municipal broadband providers may offer gigabit service for a fraction of the cost of traditional cable providers: The initial cost of building the network can be readily paid off over years once consumers start joining up because they don’t have to worry about a pay-TV infrastructure or shareholders.

However, costs for standalone internet have been artificially kept high to support the cable TV market, where telecoms corporations can truly benefit. If internet costs $65 per month and cable costs “just” $35, the cable package appears to be a bargain – even if you’re already overpaying for the internet. People are encouraged to keep the bundle rather than sign up for solo internet because the bundle is a better price.

The Future Of Cheap Internet

The ability to connect to the internet wirelessly could make all the difference. Fixed-wireless 5G or even the space internet idea should drastically reduce the cost of building a home internet infrastructure. Rather than installing wires to every single house on the street, a corporation may simply connect a fiber-optic cable to a 2,000-foot wireless tower and install a receiver in the home. Google is already looking on fixed-wireless 5G, as are Verizon and AT&T, two businesses that only serve a small percentage of the population with wired internet.

Rise Of Streaming Services

We have already witnessed the rise of streaming services and it is not coming to a halt as well. The telecommunication companies may be having these pricing models to keep the internet so costly as compared to the TV services, but this entire business could be turned upside down in the next decade. Since the streaming services are already on the market to replace cable as a pay-TV distribution mechanism, which means that easy access to low-cost internet is the only thing keeping the big cable providers from losing a mass exodus of users.

Conclusion

To sum up the discussion above, it is evident that it is the monopoly of the telecommunication companies that are trying to save their services for as long as they can. Once there are more viable solutions to the internet’s inexpensiveness, we might not even see these pay-tv services anymore.

About the author

Venkatesan Prabu

Wikitechy Founder, Author, International Speaker, and Job Consultant. My role as the CEO of Wikitechy, I help businesses build their next generation digital platforms and help with their product innovation and growth strategy. I'm a frequent speaker at tech conferences and events.

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