Cord-Cutting Services are Headed in the Wrong Direction (Premium)

Several cord-cutting services have announced price hikes recently. This isn't the way it's supposed to work.

As Thurrott Premium members are all-too-aware, I've been struggling with various cord-cutting services since before we moved to Pennsylvania last summer. These struggles take various forms, and they speak to the biggest issues with such services: Channel selection, capability, interface, and cost.

Put simply, cord-cutting is a mess, and each of the available services has some major issue. We eventually settled on Sling TV, for example, but it just stopped recording all of the TV shows I'd set up, and I can't figure out why. (I've tried various things, and will be chatting with support online today.)

Given all the issues I've had, you may wonder why I even bother. But the primary advantage of cord-cutting services, which is essentially portability, outweighs the negatives. If I can't fix Sling TV, for example, I can be up and running on another service within minutes. You can't do that with cable TV.

That said, many will point to cost as a primary benefit of cord-cutting services as well. That isn't really a key concern for me per se, but as I've noted recently, my current mix of cord-cutting services does actually save us money over cable TV.

The worry is that those savings are about to disappear. All year, it seems, cord-cutting services have been raising their prices.

It started in March with YouTube TV, which jumped from $35 per month to $40 per month for new subscribers. Then Sling TV buried a $5 per month price increase for its Orange service in news about new free and a la carte services.

This past week alone, both Sony---which runs the PlayStation Vue service---and DirecTV both announced price increases too. Both services are increasing the price of all of their service tiers by $5 per month. (Both services offer multiple tiers of service.)

What the hell is going on?

The issue, I think, is similar to the issues that services like Netflix, Hulu, and Amazon Prime face, which is tied to the cost of content: Where those services are seeing increased costs related to the original programming needed to raise subscriber numbers, cord-cutting services like DirecTV Now, PlayStation Vue, Sling TV, YouTube TV, and others are seeing increased costs from the channel selections they likewise need to raise subscriber numbers. These costs are sometimes about volume---the need for more channels---and sometimes are just the reality of the market. The cost of content is going up.

The services themselves will rarely speak openly to customers about this reality. But they do speak around it.

"Unfortunately, we must increase the price of our multi-channel plans to keep pace with rising business costs and enable us to continue offering a better way to watch the best in live sports, entertainment, and news," the Sony announcement notes. "We vow to continue providing exceptional service to our customers, with plans to ...