Throwing the Tires on YouTube TV’s New Business Claim: It Says It’s “$750 Per Year Cheaper Than Cable”


If you’ve watched ESPN’s ongoing NBA Playoffs coverage, you’ve probably seen this ad for youtube tv — the spot claims the virtual pay-TV service is “$750 a year cheaper than cable.”

In its fine print, the ad, produced by agency Essence and launched May 16, says it’s basing the claim on a 2022 SmithGeiger study “comparing comparable services over 24 months, including hidden fees. , promotional pricing, DVR box rental and service fees, and a second set-top box for the home, if applicable.”

Forget for a moment that the broad term “cable” can also apply to the internet service channel that YouTube TV uses to reach its 4 million customers (more or less). Except for the narrow segment of the population versed in the nuances of the telecommunications industry, at first glance this ad offers a vague and confusing comparison of apples and subs.

And the informed viewer must also suspend disbelief on another key law of cable industry physics: Many US cable companies have shifted their focus to broadband connectivity, shuffling their “DVR boxes” into gateways. versatile and replacing their own traditional linear video. services with third-party streaming offers like… YouTube TV.

So, keeping this conversation manageable, we’ll (try to) compare Google/Alphabet’s virtual MVPD service, priced at $64.99 per month with no hidden fees or setup fees of any kind, to this which we think is the average price of only video cable.

Right off the bat, we can tell you that there is no unifying theory as to what exactly the latter is. Even in its own marketing, YouTube TV is conflicted. Visit the landing page for vMVPD, and you’ll see it compared to its biggest competitor, Hulu+ Live TV, which is now priced at $69.99 after a recent hike.

YouTube TV also compares itself to cable TV, this time using data provided by entertainment research firm Screen Engine… which puts the total cable video bill after myriad fees at $109.30 per month.

Doing the basic math, that’s $531.72 per year more than YouTube TV.

(Image credit: YouTube TV ad using Screen Engine data)

We worked to find a scenario, beyond using SmithGeiger data, where cable TV costs $62.50 per month more than YouTube TV.

Last year the The FCC issued a finding that says the average US household spends $116 per month on “cable/internet”. However, it is more difficult to find the average price of cable video – with the ISP component extracted.

For Comcast, the nation’s largest cable subscriber, we split the $5.536 billion in revenue the company generated in the first quarter strictly from the sale of video services by the roughly 17.7 million home and business customers that the cable company had at the end of March.

We then divided that number by three to arrive at a monthly ARPU of around $104.25.

At this price, Comcast’s Xfinity-branded video services cost $471.12 more than YouTube TV each year.

Of course, millions of Comcast customers only pay for broadband, opting to receive services like YouTube TV through the free Xfinity Flex platform.

But whatever. We don’t come up with an annual price difference of $750. Not even close.

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