Streaming Service Prices Skyrocketed for a Reason

TV streaming services made big promises during their initial run. The pitch was simple. Cable companies like Comcast were charging customers way too much for television, and streaming companies were going to slash those prices down. At first, it worked.

When YouTube TV first appeared, it offered about 40 channels for only $35. It sounded great. YouTube was already a safe haven oaf free, entertaining content, and now you could grab TV basics from them, too. People bought it. By 2018, things shifted a bit. YouTube TV raised prices to $40 a month. That’s not a huge increase, and most people were willing to stick with the service at that price. Just a year later, it shifted to $50 a month. And today? A YouTube TV subscription costs a whopping $64.99 a month. With tax, it goes over many cable TV subscriptions.

This recent three year span of price increases has left many an online TV customer asking themselves, “How did we go from revolution to the same old thing?” Sure, streaming services appear more high tech and convenient than their cable TV counterparts, but their pricing is no longer light years ahead of those companies. 

Media Companies Run the Show

Like cable TV companies before them, online streaming companies quickly learned just why cable TV costs so much. In part, pricing stems from the people running the show. Media companies like Turner Broadcasting and Disney own the content that streaming services need to craft their lineups. The problem is simple to understand, but it’s difficult to solve. Media companies like Turner Broadcasting bundle their channels together and set the price. Streaming services can’t order just “the channels our customers want.” They have to buy a bundle of channels together.

A working scenario is when YouTube TV decides to add TBS. It’s very popular, and just about every customer wants it. When they contact Turner Broadcasting to add this channel, they learn that they can’t just grab TBS. It has to be TBS, CNN, AMC, and a whole bunch of other channels together. More channels mean more cost.

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Cable TV Suddenly Looks More Reasonable

The outrageous prices of cable TV created the need for online streaming services in the first place. People tired of paying a whole lot for just a few channels they liked. YouTube TV and Hulu were going to fix all that. Now it’s three years later and people are beginning to do the math. In the end, some of the streaming services are now charging just as much as satellite and cable companies. Compare DISH’s 190 channels for $69.99 to Hulu Live TV’s $69.99. YouTube TV may fair even worse here, as it offers only 80 channels for $64.99. Less than half the channels for about the same price as DISH doesn’t read well in a promo.

Even Xfinity Digital Preferred – with over 220 channels – keeps up with Hulu Live TV’s 75 channels. They’re both $69.99. The difference between the two is still noticeable, though. You don’t need a cable tech to install Hulu Live TV. Watching TV on Hulu Live TV is as simple as paying for a month of service. If you want to cancel after a month, you won’t need to go through a sales rep to do so. 

The Future of Online Streaming

Online television still has a nice advantage over cable in terms of convenience, but some people would argue that the services are one price hike away from becoming the newest enemy of TV fans, right up there with cable TV services. Unfortunately, there’s not a lot that streaming services can do about the situation. As long as media companies control the content and how it gets sold, streaming companies either pay up or lose the channels. It only took three years for Hulu Live TV and YouTube TV to learn what cable companies already knew. It’s tough to offer an economical and comprehensive television service. All good things come at a steep price.

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