Saturday, January 26, 2013

DirecTV vs Dish Network vs Cable: What is the best value?

Outdoor cable TV utility enclosure
Cable TV Distribution Box
Image source: Dr. Penny Pincher

TV Service Options

The main options for receiving television programming are satellite TV and cable TV.  The main players in satellite TV are Dish Network and DirecTV.  Local cable companies provide programming in most areas, providing a third option.  Which of these provides the best value?

Confusion Factors

DirecTV satellite dish installed on wood deck
DirecTV satellite dish
Image source: Dr. Penny Pincher
There are so many different packages and discounts that it is difficult to compare offerings between Dish Network, DirecTV, and cable companies.  For example, cable companies offer bundling of services- if you subscribe to phone service, your TV bill is discounted.  If you subscribe to both Internet and phone service, your TV bill is discounted even more.  The satellite companies offer introductory rates for 1 year or some other limited amount of time.  After the introductory rate, the prices go up and the “ every day “rate applies.

Dish Network satellite dish installed on wood deck
Dish Network HD satellite dish
Image source: Dr. Penny Pincher
In order to compare prices that you would pay in the long run, I tried to identify the “every day” price.  This is the price that you would expect to pay after the introductory rate.  This is the price with no bundling, the price you can get with only TV service.

Another issue that makes comparison difficult is that the channels included vary.  The value of a channel package depends on how much you value the channels in the package.  A 140 channel package may be more worthwhile to you than a 290 channel package- it depends on which channels are included and which ones you would watch.

How to compare?

I decided to set a budget and number of receivers, then compare what Dish Network, DirecTV, and the local cable company could offer to meet the budget.  The price points I picked out were :

  • $50 per month for one TV set, standard definition
  • $75 per month for 2 HD TV sets
  • $100 per month for 3 HD TV sets

So how much TV can you get for $50, $75, and $100 per month?

Price Comparison without Bundling or Introductory Rates

Cable has best option under $50, satellite for $75, and all have programming options for $100 per month
Table of TV programming packages available for $50, $75, and $100  per month
Image source: Dr. Penny Pincher

Note that this comparison chart represents my best attempt to sort through the many offers and packages to find the “every day” price with the charges for the receivers included.

These prices get higher if you want to upgrade your receiver to a DVR so that you can record shows.  This may cost an additional $10 for an “advanced receiver service” or similar fee per month FOR EACH DVR.  Also, you may need to pay for the DVR equipment, which costs about $200 per receiver.  This may be an upfront fee, or may be rolled into your monthly bill at some point.   Also note TV service typically requires a 18 to 24 month service contract- if you want to leave early you'll have to pay a cancellation fee which can be substantial.

I was disappointed that $50 per month doesn't get you much.  All I was looking for in this price range was service for 1 standard definition TV set.  Only the cable company delivers in this price range.

At the $75 price point, DirecTV and Dish Network provide options that meets the budget and provides 2 HD receivers.  The local cable company did not have any offerings with 2 HD receivers in this price range.  Moving up to the $100 budget for 3 HD receivers, DirecTV, Dish Network, and the local cable company all have options.

Which to choose?

It is a good thing that there are several choices available.  If you are looking for the lowest cost option, cable TV is the way to go.  The satellite companies do not offer packages in the under $50 price range.  If you have $75 per month to spend and want multiple HD receivers, the satellite companies have the only offerings.

If you have around $100 per month to spend, DirecTV, Dish Network, and cable all have packages with lots of channels for multiple TV sets.  Since the price is similar, I think the decision comes down to which packages have the channels you want the most.  You can find the list of channels on the provider's website.  I would suggest printing out the channel listing, passing it around to your family and having everyone circle the channels you think you would actually watch.  This exercise will help you see which is the best value in terms of channels that you would actually watch.

TV Augmentation Options

If you don’t have $100 per month to spend on TV, or even $50, there are some ways to get some movies and television at a low cost.

Table of video services and cost
Low Cost TV Augmentation Options
Image source: Dr. Penny Pincher

Penny Pinching Tips:

  • When selecting TV service, find out the cost after the introductory period.  This is the price you will likely pay for years and provides the best basis for comparison
  • Look beyond the number of channels, check for channels in the programming package that you would actually watch
  • Watch out for additional equipment and service fees if you add a receiver with DVR
  • Cable has the best option for simple, low-cost service
  • Cable and Satellite have lots of options, especially at $100 per month and up
  • Consider low-cost TV augmentation options, you may be able to cut back on TV service if you use these options

If you don't really want all of the channels that cable or satellite TV offers, you can get free HD TV over the air using an indoor HD TV antenna that costs $50.

Recommended Reading:
Cell Phone Plans for Existing Cell Phones

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1 comment:

  1. Thanks to who posted this it helped me make a choice I would be happy with.


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