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HDTV Cost per Hour Down 11%

September 6, 2007 | Author: Ibex Marketing

Are you ready for some football? Sports appears to be one of the greatest driving forces behind the adoption of HDTV, and football is probably the most influential of all. So it’s little wonder that this is the time of year when the thoughts of football fans turn not to the kick-off for the season opener, but rather to the task of convincing their significant other (or themselves) that they really should get an HDTV now.

As a public service last year, I ran the numbers and calculated the hourly cost of watching an HDTV. This was well-received, so I’ve decided that it’s now time to update that figure. In time for tonight’s opening kick-off to start the NFL’s regular season, here is “Professor Poor’s HDTV Hourly Cost Index for 2007” which I’ll call the PPHHCI2007 for short.

Using data derived from Nielsen Media Research’s benchmark figures, I assume that two people will watch the new screen for an average of 4.5 hours per day. Based on a comprehensive review of cable and satellite services, I estimate an average monthly cost of $65 for high-definition service. (This assumes that you buy more than just the basic package in most cases, and takes into account that some people will watch high-definition programming over the air for free.) And this year, I’ve refined the model to assume a 42″ LCD or plasma flat panel HDTV. Using figures from Pacific Media Associates, I figure that the average price paid for the HDTV to be $1,497. (Many people will get their 42″ set for less than $1,000.) Finally, I assume that you’ll keep the set for five years. (The fact is that many people keep their sets much longer, but I want to make this a conservative estimate.)

Turn the crank, and the results say that you can watch your new HDTV for $.33 per hour over the five year period. Last year, the PPHHCI2006 was $.37, so this is an 11% decrease. (Aren’t you glad you waited? You just saved 11%!)

Now, a number of factors could be applied to make the costs lower. For example, I do not assume that you’re already paying for some cable or satellite service; the full subscription cost is included in the index. Also, it’s possible that HD service rates will decrease due to increased competition. Since this accounts for nearly three-quarters of the overall cost, that could result in significant savings. But the intent of the PPHHCI2007 is to give a snapshot for now.

Since a typical football game lasts three hours, you can now tell your significant other that it will cost less than $1 for you to enjoy it on a new HDTV.

So what is your best choice for a new HDTV? You can find out in now available in paperback from Amazon or other fine booksellers.