Cut Your Cable Bill
Cut Your Cable Bill. Potential Savings: $100-600/year in 15-30 minutes. Difficulty Level: Low
|Andrew||Sep 3, 2019|| 3|
Welcome to Saving Money with Andrew. Thank you for signing up and if you like it, please tell your friends!
If you’re reading this you probably know me personally, and know that I love sharing money-saving tips and other unsolicited advice. I thought I’d try a semi-regular newsletter with simple, actionable tips that may save you money, sometimes a lot (!), with little effort.
In future issues, I might expand to other topics, but for now let’s keep it simple. Without further ado…
Tip #1 - Save Money on Your Cable/Telco Bill Every 12-24 Months!
But First, A Riff on the Cable/Telco Industry
The cable companies are the least-loved corporations in America. Not hard to see why. From a wild west of fierce competitors in the 70’s and 80’s (see the excellent Cable Cowboy), the industry consolidated to three major cablecos, carving up the country by region.
In most cities, there’s one cable company (e.g., Charter/Spectrum, Comcast, Optimum) and, if you’re lucky, a telco (AT&T, Verizon, CenturyLink) offering broadband/TV/phone service. The result of this lack of competition is high prices and poor customer service.
But, the cable oligopoly has one weakness you can take advantage of. Building a cable system involves large capital investment (wiring, network equipment, etc) but low marginal (per-customer) cost to provide service. Makes sense. After the cable guy sets up your cable box/router, do you think it costs much to provide service? To the provider, you are a very profitable, high-margin customer at almost any reasonable price point.
So, your goal as a customer should be to make sure your cable provider earns as little from you as possible. How do you do this? Some options include (i) reduce internet speed (shockingly, almost all internet plans greater than 100mbps are mostly unnecessary even with heavy video/gaming usage), (ii) switch to a “skinny” Pay TV bundle (or cut the cord entirely), or (iii) eliminate landline service (and enable Wi-Fi Calling on your cellphone for landline-level sound quality at home). But today’s tip is to save money without having to cut anything.
Seven simple steps:
Call your Cable/Telco Provider. The phone number will be on your bill.
Ask to be transferred to the “Retention” or “Cancellation” department. You might need to say you are considering cancelling, you may be able to just ask directly.
Say you are considering cancelling, and ask if any promotions are available if you stay. You can be as blunt as you’d like, but be polite!
Unless you are already on a promotional rate, it is highly likely (probability 75%+) that you will be offered a significantly better rate for 12 or 24 months. Often this will not even require a contract or commitment, but you might get a better deal with a contract, depending on your provider.
Ask if any other discounts are available. You can push this part as much as you’d like, but if you don’t ask they’re not going to offer you anything!
Confirm you will receive the discount and how long it will last, and say thank you!
Set a reminder on your calendar for however long the new rate lasts + 1 day, and repeat from step 1.
It is shocking how few people do this. And monthly fees spiral out of control when people don’t. I’ve seen many $200+ and even $300+ monthly cable bills, usually from several years of high-single digit % increases that went unchallenged. In my experience, the average monthly savings ranges from $20 to as much as $60 or more. A pretty good return for what should take 15-30 minutes!
I hope this has been helpful! If this works for you, please let me know! I would love any feedback or suggestions you have for this newsletter, especially content and frequency. And if you liked it, please tell your friends!
P.S. This tip has a much lower success rate for wireless bills, though it is always worth calling and asking about discounts (AT&T Wireless often has significant discounts for many groups based on employer or affinity groups). I’ll discuss the wireless providers in another issue. But for most other subscription-based businesses, this will work. A recent chat with the NY Times saved us 73% (about $140) for the next 12 months, bringing us back to a $1/week subscription. Don’t forget to set a 12 month reminder!
 Because there are relatively few new customers to sign up, the industry focuses on maximizing profitability from a stagnant customer base, cutting costs by aggressively outsourcing customer service, and raising prices well in excess of inflation.
 Pay TV is a partial exception - cable companies pass along much of the TV portion of your monthly bill back to the cable networks (e.g, ESPN), who earn much of their revenue from per-subscriber “carriage fees”. For some channels, particularly the regional sports networks (e.g., YES, FSN Chicago), carriage fees account for the majority of revenue, with relatively little from advertising. The dark secret of TV is that most channels have shockingly few viewers.