Part one of a series on what every media reporter and executive should know, but probably doesn’t.
What is more expensive, playing Batman or watching it? What is the real cost of watching TV or surfing the Internet on your smart phone? If you hate video ads or Facebook ads, how much should you have to pay to remove them? How much should it cost to be able to play everything, watching everything, listen to everything?
In the next series of posts I’m going to cover the cost of
- Music and Radio
- Magazines & Newspapers
- Phone service
- Other services
Unlike many harried journalist I have reliable data sources for my many stats…
First, how much do Americans spend to watch TV?
We pay for TV in 3 ways:
- We buy a TV (or other hardware)
- We subscribe to a TV service
- We watch ads (or buy/rent a DVR)
How much do our TV’s cost?
We buy 37.1 million TVs at an average TV costs of $704. However it’s replaced only about once every 7 years. Per viewer (in the USA there is slightly more than 1 TV per person) this works out to $97/year, plus another $25/year in electricity. That’s a total of $122/year or just about $10/month per viewer.
And what is the cost of those TV ads?
We watch $64B worth of Ads or $18/month per viewer.
The cost of TV + TV service + TV ads
$10 + $22 + $18 = $50/month.
For this we watch ~3 hours of TV a day or ~$.50/hour. That’s cheap entertainment!
Why ~3 hours a day and not ~5 (what Nielson reports)?
I use Bureau of Labor Statistics (BLS) data and then add 10%. I chose the BLS because Nielsen adds ‘background’ time; when the TV is on but we’re not in the room, when we’re in the room but not watching since we’re sleeping, playing a game, reading, surfing, cleaning, talking on the phone, …
My 10% addition to the BLS estimate represents my estimate that one third of this multitasking time (we spend 30% of our TV hours multitasking) we’re focusing on the TV.
Question: What costs more, a cigarette or a TV show?
Answer: About the same:
- Since Americans spend $77B for 327B cigarette equivalents that’s $.24 a cigarette. At $.50/hour (above) that’s $.25 for a 30 minute show. So a cigarette ($.24) costs about the same as watching a TV show ($.25).
- Since a typical cigarette lasts about 6 minutes, smoking is 4x more expensive per minute than watching TV.
- Per month, Americans (on average, smokers and non-smokers combined) spend $34 on Tobacco, a bit more than the cost of the TV, TV service and electricity ($32/month per viewer), but less than the cost of TV service plus TV ad revenue ($18/month, or a total of $50/month). Of course as ‘only’ 44 million Americans smoke, our non-smokers spend $0 and our smokers spend $240 a month to smoke!
Bonus question. Which is worse for you, smoking or watching TV?
Answer: They are equally bad. Either watching a (half hour) show or smoking a (six minute) cigarette will shorten your life by 11 minutes.
More on TV
- ~4.5 Hours per day of TV (including multi-tasking) http://www.emarketer.com/Article/Digital-Set-Surpass-TV-Time-Spent-with-US-Media/1010096
- 289M TVs on ~5 Hours per day http://www.nielsen.com/content/dam/corporate/us/en/reports-downloads/2013%20Reports/Nielsen-US-Consumer-Usage-Report-2012-FINAL.pdf
- Big report on TV http://www.tvb.org/media/file/TV_Basics.pdf
- TV watching stats from Nielson http://www.statisticbrain.com/television-watching-statistics/