We Killed Cable and Rebuilt A Worse Version

It's Monday, June twenty second. So the other night I wanted to watch The Social Network. Great movie, been out for over fifteen years. I opened Netflix. Searched for it. Not there. Tried Hulu. Not there. Tried Prime. Not there. I think I eventually found it on some service I barely use, or maybe I just ended up renting it for five dollars on Apple TV. Either way, it took me fifteen minutes of searching across apps to find a fifteen-year-old movie, and the whole time I was thinking: I pay for like five of these things. Why is this so hard? And when I looked into it, the numbers confirmed that frustration. I have five subscriptions. I'm spending somewhere around seventy dollars a month on streaming. And the movie I actually wanted to watch wasn't included in any of them. That feels like a scam, and when I looked into it, the numbers confirmed that feeling. The average American household spent $278 per month on streaming and connected TV services in 2025. That's more than most cable bills ever were. We cut the cord to save money. We killed cable. And then streaming slowly became cable again, except now it's more expensive, the content is spread across fifteen different apps, and you still have to rent The Social Network. To understand how streaming went from saving us money to costing us more, you have to understand what the original pitch actually was.

In 2011, Netflix was $7.99 a month. No ads. Every movie and show in one place. You could share your password with your entire family and nobody cared. For eight bucks, four people in four different cities could watch whatever they wanted whenever they wanted. That was the promise: pay less than cable, get more flexibility, no contracts, no bundled channels you never asked for. And for about five years, it worked. People ditched cable in record numbers. The cord-cutting movement felt like a consumer revolution.

What was actually happening was a subsidy. Netflix was spending billions on content and pricing below its costs to grow its subscriber base, the same playbook we covered in the Uber episode. Amazon priced Prime Video as a free add-on to get you to buy more stuff from their store. Disney launched Disney+ at $6.99, well below what it cost to produce and license the content, because they needed subscribers fast. Every major studio launched its own service between 2019 and 2021, pulled its content off Netflix, and priced aggressively to compete. The consumer briefly benefited from a price war. You could subscribe to five services for the price of a single cable package and get more content than you could watch in a lifetime.

Then the war ended and the bills arrived.

Netflix's ad-free plan went from $7.99 to $17.99. Disney+ went from $6.99 to $18.99 for ad-free. HBO Max added $1.50 in one price bump alone. Paramount+ raised prices twice in eighteen months. YouTube TV, which launched at $35 a month as the affordable alternative to cable, now costs $83. A household subscribing to Netflix, Max, Disney+, Peacock, and Paramount+, which is a pretty standard combination, is spending about seventy dollars a month before any live TV service. Add YouTube TV or Hulu Live for sports and local news and you're at $150 to $165 per month. The average cable bill in 2019 was $85 to $147 depending on the package. We replaced cable with something that costs the same or more. The price increases are obvious because you see them on your credit card statement. But three other things changed that are less visible and arguably more important.

The first is ads. Netflix launched as an ad-free service. That was the whole selling point: you're paying a subscription so you don't have to watch commercials. In 2022, Netflix introduced an ad-supported tier, and by 2026, the ad tier is the default entry point. The ad-free experience that used to be the standard has been repositioned as a "premium upgrade" that costs more than double. Disney+ did the same thing. Peacock did the same thing. Paramount+ did the same thing. The pitch went from "pay for content without ads" to "pay for content with ads, or pay significantly more for the experience you used to get at the original price." That's cable. That is literally the cable model: you pay a subscription and still watch commercials.

The second is password sharing. For years, streaming services looked the other way while families and friend groups split accounts. That implicit tolerance was a subsidy that made streaming feel cheaper than it actually was. You weren't paying $15 a month. You were paying $3.75 because four people were splitting the account. Netflix cracked down in 2023, blocking access from different physical locations and offering "extra member" add-ons for $7 to $9 per month. The password-sharing era was the streaming equivalent of Uber's subsidized rides: it got you hooked at an artificially low cost, and once you were dependent, the real price kicked in.

The third thing is content fragmentation, and this is the one that makes me feel like we're being played. When Netflix was the only major streaming service, it had everything. Not literally everything, but close enough that you rarely needed to go elsewhere. Then every studio launched its own service and pulled its content off Netflix. Warner pulled Friends and put it on Max. NBC pulled The Office and put it on Peacock. Disney pulled everything Marvel and Star Wars. Sony struck deals with different platforms for different release windows. The result is that the content you want is scattered across half a dozen services, and no single subscription gives you access to all of it.

And the content doesn't just sit in one place. It rotates. The Social Network was on Netflix for a while, then it left, and right now it's only available through a third-party channel add-on on Amazon Prime, which means you'd need your Prime subscription plus an additional paid channel to watch it. A fifteen-year-old movie that's been fully paid for and recouped its costs many times over requires a subscription plus an add-on subscription to stream. That's the system working as designed, and it's designed to extract maximum revenue from every title by moving it between platforms and pricing tiers on a schedule the consumer never sees.

Of the 280,000 movies in one global database, only about 34,000, less than twelve percent, are available on the top eight streaming platforms combined. Eighty eight percent of movies are either on smaller niche services or not available to stream at all in the United States. The movie you want to watch has roughly a one-in-eight chance of being on a service you already pay for. When it's not, you rent it for four to six dollars, which is essentially the same as walking into Blockbuster in 2003 except now you also pay seventy dollars a month for the privilege of not finding what you want. The thing that frustrates me most about all of this is the realization that we didn't disrupt cable. We dismantled it and rebuilt it in a worse configuration.

Cable was expensive but centralized. One bill. One interface. One remote. Everything was in one place. You complained about paying for channels you didn't watch, but at least you could find the thing you wanted to watch without checking five apps. Streaming was supposed to fix that by letting you pay only for what you wanted. Instead, we now pay for five to seven services, each with its own app, its own interface, its own search function, and its own content library that shifts every month as licensing deals expire and renew. The content is more fragmented than it ever was under cable, and the total cost is comparable or higher.

The Tom's Guide writer who analyzed all of this put it perfectly: "You're no longer paying strictly for what you watch, but rather the idea that you might use it. Which is, of course, exactly how cable worked." That sentence captures the entire arc of the streaming revolution. We went from "pay for what you want" to "pay for the possibility of finding what you want across multiple platforms, and rent it separately when you can't."

The pattern is the same one we've covered in the Uber episode, the AI pricing episode, the gaming episode, and the Enhanced Games episode. Subsidize the product to kill the competition. Once the competition is dead and consumers are dependent, raise prices, add ads, and remove the features that made the product attractive in the first place. Netflix didn't plan this from the beginning. They really were trying to build something better than cable. But the economics of content production, combined with every studio wanting its own direct-to-consumer platform, created a landscape where the consumer ends up paying more for a worse experience than the thing they left behind.

If you're feeling like you're being played, you're not wrong. The streaming services know exactly what they're doing. The question is whether any of us are going to do anything about it, or whether we'll just keep adding subscriptions and complaining about it at dinner. Probably the second one. So if this comes up in conversation, here's how to think about it. Cutting the cord was supposed to save money. For a few years, it did, because streaming services were pricing below cost to win subscribers. Now the subsidies are gone. Netflix went from $7.99 to $17.99. Disney+ went from $6.99 to $18.99. YouTube TV went from $35 to $83. The average household spends $278 per month on streaming and connected TV. Ads are back on every platform. Password sharing has been locked down. And of the 280,000 movies in one global database, only twelve percent are on the top eight services. The movie you want probably isn't included, and you'll end up renting it for five bucks on top of the seventy you already pay per month. We killed cable and rebuilt it as something more expensive, more fragmented, and more confusing. The only thing we actually got rid of was the cable box.

Stay informed, stay curious, and we'll see you tomorrow.