Little Secret for Serious Cable Cutters: Amazon Prime Beats Netflix in Value

ImageI just realized that the last time I wrote anything on here was February 12.  In case anyone thought I had abandoned my blog, that’s not the case.  The bar examination started two days ago, and finished just yesterday.  It was probably around February 12 that I started feeling like I needed to spend every waking hour studying for the bar (nothing like time pressure for motivation).  Anyways, that’s all done, and now I’m back writing while I wait for the results to come out.

Recently, I ran into a deal on Amazon Prime.  If you are not familiar with Amazon Prime, it’s a subscription service through Amazon, where you pay an annual fee of $79 and you get: 1) free shipping on the stuff with “Prime” logo; 2) have access to Amazon instant video; and 3) the ability to borrow books from the Kindle Owner’s Lending Library.  I had seen Amazon Prime ads before but it never caught my attention.  This time around, they offered a $39 for the first year, so I decided to try it out.

Saying Goodbye to Cable TV

ImageCable-cutting is on the first page of ALL frugal-living 101 books.  I remember when M & I first met, she was paying around $120/month (remember, this should be always thought as $120*12=$1440/year, rather than “just $120 a month”) for her cable TV + internet.  At the time, she didn’t think much of it, and neither did I.  That’s what people pay for these things, right?  Luckily, our financial awareness started to grow and we decided that she should look for other alternatives.  Since then, our TV set-up has been built on: a) local HD channels, and b) Roku streaming.

HD Channels & Roku Streaming

1. HD channels are comprised of major national TV channels (FOX, NBC, CBS and ABC).  These channels are everywhere and they’re free!  The best way to pick them up is with your internet cable.  As long as you have internet service, these free channels will almost always flow through them.  I have a splitter that splits my internet cable from the wall.  The splitter splits the cable to our modem (for the internet), and to our TV (for the HD channels).  I know many people use external or built-in antenna (a.k.a. bunny ears).  Rest assured, I have tried at least 5 different types of external antennas and have largely been disappointed at their inconsistent performance.  Your location and weather can affect the quality of your HD channels, and it could really piss you off when you’re watching something intently.  I can’t guarantee ALL internet providers do this, but it seems to be the norm.  We did it this way with Comcast in Little Rock, and now with Cox in Northwest Arkansas.

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Two Way Splitter

2. Roku is a video streaming device that runs on internet.  You need internet to use Roku.  Roku has countless channels you can subscribe to.  Some of them are free and some are not.  Examples include Netflix, Amazon Instant, HuluPlus, HBO, YouTube, etc.  Now, there are other competing devices such as the Apple TV or Google Chromecast.  As far as my research goes, however, I think most reviewers believe that Roku stands in the forefront of the TV streaming industry.  Roku has the most channels available, and that’s something you want to check before purchasing a streaming device.  We have the “Roku 1” device, and that works perfectly for us.  If you need guidance in deciding which device is the right one for you, check out this article.

Amazon Instant Video vs. Netflix

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Netflix at $7.99/month

We’ve always been fans of Netflix.  At $7.99/month, you have access to unlimited entertainment.  If Netflix offers particular shows that you want to watch, and you GOTTA have it, then $7.99/month is not bad.  However, if you want access to streaming for general entertainment, I recommend that you at least check out Amazon Prime.  Like I said before, membership to Amazon Prime gives you access to Amazon Instant Video.  At only $79/year, similar to Netflix, you get documentaries, TV shows and movies.  Obviously, you probably want to check out their library before ditching Netflix.  Look how they stack up price-wise, though.  $79/year for Amazon Prime vs. $96/year for Netflix.  Reminder: Netflix doesn’t give you FREE SHIPPING on stuff (select items) you buy on Amazon!

If you check out the selection of content on the Prime library, and think you can fulfill your entertainment needs with it, I think the jump from Netflix to Amazon Prime is more than reasonable.  In essence, Amazon is offering you more for less money.  Why not take it?

Your Decision

I’ve read in few articles that Amazon is considering hiking up the Prime subscription fee.  That would be a huge bummer, but  Amazon might still stand ahead in the value category even if they do raise the price.  The value you would get out of Amazon Prime would depend on how much Amazon increases the fee and how much you shop on Amazon.  As for our household’s monthly expenses on electronics, it now looks like the following:

  • Streaming with Amazon Prime: $6.5/month
  • Local HD Channels: $0.00/month
  • Unlimited Internet: $32.99/month
  • 2 Republic Wireless Cell Phones: $25/month
  • Total: $64.50/month

I hope to improve these numbers in the future, but I feel like I’ve hit a wall.  For now, it suffices to say that what we pay every month for a) streaming, b) internet and c) 2 cell phones is far less than what many people pay on 1 cell phone these days.

How do you cut costs for home entertainment?  Are there other creative ways to achieve this goal?

***UPDATE: As of 03/13/2014, Amazon raised the Prime price by $20.  Now, it’s at $99/year, or $8.25/month.  Still a great deal considering the totality of the package.

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7 thoughts on “Little Secret for Serious Cable Cutters: Amazon Prime Beats Netflix in Value

  1. I’ve looked into both netflix and amazon prime and both sound pretty good! I have heard that not as many “good” shows are on amazon prime (but I guess that depends on the viewer’s tastes!). We have free cable for the moment but once that runs out we’re goign to look into getting one of those two options to stream through our Roku! That’s awesome that you got a $39 deal on prime- wow!

    • You got all kinds of free stuff up there (I remember you telling me your utilities were included with rent)! And you’re right, if Netflix has a show that you love, and Amazon doesn’t, then I think the difference in price is probably justifiable. In my case, I don’t watch tv shows, but my fiancee enjoys watching them. Good thing is, she doesn’t have a preference, she just enjoys watching good shows, so Amazon Prime ended up working really well for us!

  2. Great review! We will look into Amazon Prime now. Netflix has been a win because of the variety of kid shows, and some key favourites have been rotated out recently – opportunity for change! Thank you for this review.

    • Thanks! Netflix is still a good value for what it offers. Especially if it caters to not only the adults in the house, but also the children. But you might as well check Amazon out see what they got (before they raise the fee, if in fact they do…)!

  3. I haven’t had cable for a while now, but I’ve been using an antenna to get my OTA channels and a TiVo with Comcast internet. My main frustration is, as yours was, poor reception in bad weather (or any kind of weather, really). Your cable splitter suggestion had me curious, so I went out and bought one to give it a try. I hooked it up to my main coax cable and sent one side to my modem. No problems there, but when it came to hooking up my TiVo, I got a little lost. I’ve got two options on the back of my TiVo box – cable and antenna. I chose cable first and ran the guided setup, choosing cable as my TV source. Finished setting up the TiVo and went to check the reception – no channels at all. So I went back and switched the coax to the antenna side and reran the guided setup, this time choosing antenna as my TV source. Again, nothing, so I screwed the coax straight into the TV, thinking maybe TiVo was the issue. Nothing. Not sure why your solution isn’t working for me, but for now, it’s back to the rabbit ears, which is a shame because your talk of clear HD channels was very alluring.

    • I’m sorry you had to go through all that. I’m not familiar with TiVo and similar devices and haven’t tried it. I don’t know who provides your wireless internet, but my previous experience with Comcast and Cox has been uniform, in that they both came with local channels. You deserve recognition, though, for going that far! (Also, when you do use your wall coax as a source of your local channels, you must go through settings on your TV to “detect” or “find” channels. It’s like a process where your TV syncs with your coax).

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