The average cable bill includes $37.11 worth of “hidden” added fees. These are fees that go on top of the advertised price, so many people don’t expect them. In fact, according to Consumer Reports, 69% of customers say their cable bills have fees they were not expecting.

Big Cable lost a total of 596,086 subscribers in Q1 of 2020, according to new data from Leichtman Research. That means in the first quarter of this year, cable companies lost out on around $22 million per month in hidden fees, or $66 million for an entire quarter. In 2020, the subscribers the companies lost this past quarter will cost Big Cable around $264 million in hidden fees! If this trend continues in the next three quarters of the year, cable TV companies could lose $1 billion in hidden fees alone in the next year.

cable hidden fees

Common hidden fees on cable bills include:

  • Broadcast TV fee- Did you know you’re charged extra for channels you could probably get free with a TV antenna? In fact, our report last year showed that Comcast took in around $2.64 billion in fees for these free over the air channels.
  • Regional sports fee- Cable companies pay regional sports networks to carry their channels, although sometimes those networks are owned by the cable companies themselves… hmmmm… not a sports fan? Too bad! You’re stuck with paying.
  • Cable box fees- If you have cable, you need a cable box. But you better believe the cable companies aren’t offering those for free. Nope, you have to rent it.
  • HD fee- While you might think high-def (HD) is standard in 2020, it’s a common additional fee tacked onto your cable bill.
  • DVR fee- Some cable companies slide in an extra charge for the DVR that’s not in your quoted price.

This does not include the average $13.28 in taxes. The Q1 losses will cost state governments about $8 million per month in tax revenue. That’s $96 million a year!

Of course, those hidden fees and taxes are only a portion of the money cable companies charge each subscriber. According to a recent report by Decision Data, the average US household is paying $217.42 per month for cable. That means Q1 losses cost Big Cable around $130 million a month in subscription fees. Multiply that out and you’ll see that Q1 subscriber losses could cost cable companies a total of $1.5 billion a year!

This doesn’t come as a huge surprise to us, as cord cutting has been accelerating dramatically in recent years and Big Cable continues to bleed subscribers. And with the current pandemic, things have only gotten worse. As shown in our recent report, the lack of live sports is hurting pay-TV in a big way.

After all, live sports is the last thing that really keeps people tied to cable subscriptions. Yet without live sports for the last two months, subscribers have paid $3.5 billion in fees for events that never occurred. In fact, a recent survey we ran showed that 32% of cable subscribers say they will consider cancelling their cable if live sports don’t return by June 1st.

On the other hand, streaming video on demand service, Netflix, brought in 2.31 million new customers in the US and Canada in Q1. Their subscribers have upped their streaming habits to around 3.2 hours per day. The company is absolutely thriving… with no hidden fees.

The fact is that Q1 was devastating to cable companies, and I think that we’ll see when Q2 stats come out and a full quarter of quarantine has finished that the pandemic just might be the final straw for cable TV as we know it.

 

William Parker

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