Cutting the Cord, A Series:  Part 1, The Economics

We’ve been asked, and read a lot about cutting the cord, but we have yet to see a good series on the pros, the cons, and the costs of doing so.  Well they say that if you want something done right, its best to do it yourself, so let’s get to it.

First, if you require Monday Night Football, and NBA basketball on TNT, you’re out of luck.  There’s not a good online replacement for either.  Looking for TBS baseball, ditto.  Yes there’s NBA pass, and yes, there’s MLB League Pass as well, but its not the same, so you sports nuts should go back to your bliss of overpaying for a ton of content you don’t use to your local cable company.  For those of you undeterred, read on.

For purposes of this exposé, I’m going to assume you spend $80/month on cable – that’s cable, not internet or phone, just the cable component of your triple play.  Now some of you are going to cry, “Wait, I pay $100, no $120, no, I pay ONE MILLLLLLION dollars per month for cable!”  Yeah, we get it, cable’s pricey, but using a conservative figure of $80/month shows just how compelling cutting the cord is.  As you math majors have already figured out, that’s $960/year.

First thing you need is a box to run media center software on.  We’ve profiled, Plex, Boxee and XBMC, all are free, but for this series, we are going to focus on Plex.  Why?  Because for cord cutters, its the most cost effective solution to enable EVERY TV IN YOUR ENTIRE HOME.  This is because Plex is a true client/server system, you only need one box in the house to serve up media to any and every TV in the house.  Start watching something in your living room but want to finish in the comfort of your bedroom?  No problem.  Or finish it on the road on your iOS/Android device.  Gotcha covered.  The Plex Media Server knows where you paused/stopped, and starts it back up right from that spot on any client.  Boxee and XBMC don’t separate the two, and thus each TV requires a some sort of box with its own library to get the full glory of your media.  Now this is going to cause lots of comments, but the point of part one is the focus on cost, so work with me here.

Plex enables users to run one box (Windows, Mac, Linux) and serve up multiple clients cost effectively.

Let’s make the assumption you don’t own a PC or Mac, or a PC running Linux, crazy I know, but let’s just assume.  One can go out and buy an Acer Revo for under $400, or the Dell Zino for $600, or a Mac Mini for the same $600 (Plex’s Media Server app runs on Windows, Max OSX and Linux).  But if you already have a decently powered box in your home, you don’t have to spend an additional nickel.  Also, the Plex Media Server now runs on a number of Linux variants, so if you have a powerful enough NAS device, you can run the PMS there too.  Worst case scenario, $600 + tax.

Tab thus far: $600 (or zero biatch!)

Next, you want live TV.  Well, you don’t need it as you can get any TV show on the planet for either free or a minimal monthly charge (more on that to come), but for live TV you need an antenna.  Let’s assume you live in the swamps of Mississippi.  Nothing against swamps of the great state of Mississippi, the point is a) I like writing M-I-S-S-I-S-S-I-P-P-1 and b) I’m assuming you are far, far away from any broadcast towers and thus require the mother of all antennas which cost under $200.    Now someone’s going to have to get on the roof and install that bugger, that’ll cost you, conservatively, another $200 which includes some basic coax wiring.  Worst case, another $400.

A site like Antennaweb.org can help you select the right antenna

Installing a rooftop antenna is serious business. Take great care when doing so.

Tab thus far: $1,000 or $400 if you already have a box

Now the media center software…that’s easy FREE FREE FREE.  Plex is free, so are XBMC and Boxee, pick your poison.

Now what about all those shows you know and love?  There are two ways to go, one free, the other $10/mo.  The first is the free way, the torrent way.  We’ve written about that on here before.  To facilitate downloading the shows, you need a torrent client, like Transmission, BitTorrent, uTorrent or the like (all free), a PVR like ShowRSS or SickBeard which we’ve also profiled, and for movies, access to a private tracker site.  DO NOT download movies from public tracking sites, bad things can happen (think 5.0, warnings from your ISP, etc, etc).  Troll around on the Plex or XBMC forums and try to score an invite, it isn’t that hard.  This entire setup is free, lovely!  The Usenet method, which we’ve also outlined on the site, costs roughly $10/mo, which is your worst case scenario.

Usenets vs. Torrents is 5.0 vs $$. Both work well, but torrent at your own risk.

Tab thus far: $1,000 (or $400) + $10/mo

Now you need a place to store all that lovely media, and that requires an external hard drive.  You can go the NAS (network attached storage) route, but its more expensive and unnecessary (although it really is lovely and recommended).  There’s lots of options, but you can easily buy 2TB of storage for under $200.  Don’t believe me, just look here.  But lets assume another $200.

Tab thus far: $1,200 (or $600) + $10/mo

What about Netflix and Hulu.  In my opinion, Hulu is completely unnecessary.  There’s nothing there you can’t get from the torrent/SickBeard & CouchPotato options, but let’s assume a Netflix streaming subscription so you can watch Gone with the Wind whenever you like.  $8/mo

Finally, what about recording, pausing and time-shifting live TV?  Here’s the thing, with the setup thus far, you a) don’t need it and b) will rarely if ever use it.  When I cut the cord almost 2 years ago, I went out and bought EyeTV for $80 plus the $20/year subscription for TV Guide and an HDHomeRun for $130.  I only use either when I travel and want to watch live, local TV, which is, basically once in a blue moon, or I want to show off to friends (but I’m seeing someone about that).  With the antenna setup, and every TV after 2003, you’ll be able to watch the Emmys, the Tonys (you know you do), the Superbowl, March Madness, etc, live and in glorious uncompressed HD.  You still want it, get it, but you won’t use it.  That’s another $210.

Total thus far: $1,410 (or $810) + 18/mo

Alright, now what about all those other ginormous big screen TV’s in your house?  Well this is where Plex hits the ball out of the park.  Already own an LG Netcast or Samsung SmartHub TV?  Plex clients already exist for both…for free!  Or, at $49, the new Roku2 LT has a free Plex channel built for it too.  So for $50/TV, you can extend all the your delicious media to any TV in your home.  You can buy the more expensive Rokus, but unless you live in one of those storage container developments, or get really bad WiFi around your home/apartment, there’s no real need for a wired setup.  So lets assume two Roku LTs, that’s another $100.

Grand Total:  $1,510 (or $910) +18/mo.  That gets you ANY TV SHOW YOU WANT, plus movies downloaded to a dedicated hard drive, plus live TV for the main broadcast plus local channels in your area, served up to at least 2 TVs in your home.  So if you don’t already own a PC or Mac (which btw how are you reading this right now if that’s the case), your break even is 25 months, and that math my friends, includes the $18/mo (to get that, solve the following: 1510 +18x = 80x where x is the number of months, and you thought algebra would never come in handy).  After that 25 months, your ‘cable’ bill is just maintenance on the setup, and the $18/mo.  If you were born after 1940, and do own a box, that break even goes down to 14 months, and I’m assuming most of your reading this fall into that camp.  Don’t go the EyeTV (or similar product) route, that that cuts the break even to under a year, and the overwhelming majority of people I’ve helped cut the cord fall into this later camp.  If you are paying $100/mo or more, the break even is WELL under a year.

Are there downsides?  Yes.  The live sports options currently suck, but your over-the-air antenna will get you ABC/CBS/NBC and FOX live sporting events.  Do you only watch the Food Network or the History Channel?  Content is limited, but Plex has numerous plugins that pull content from websites including full episodes (both those channels included).  XBMC and Boxee have some similar, although more limited options.  Can you cut the cord and exactly replicate cable’s offering?  No.  Can you come close depending on your proclivities?  Yes, and we’re here to help you do it.

Next up in the series, picking the right equipment.  Until then, happy cutting….

Update: Click here for Cutting the Cord: Part 2, Live TV!