Interesting look in NY Times at the growth of entertainment and communication services:
- it is not the cost of the machines that has most altered household budgets. Instead, all that cheap computing power embedded in scores of new gadgets and married to communications networks has resulted in a growing number of subscription services that most consumers cannot resist – and continuing charges that they cannot escape.
The party line phone service they had in 1974 probably cost Mr. Green’s family about $19 a month, the equivalent of about $70 today when adjusted for inflation. Long-distance calls were thought of as expensive, infrequent luxuries. Watching television was free, and access to the Internet would not be generally available or billable for two decades.
Today the Greens pay more than $225 a month for services that enable them to watch television, make phone calls and communicate over the Internet. That is more than a threefold increase, in today’s dollars, for communications and home entertainment.
Research at Columbia University in the late 1990’s suggests that like the Greens, most other American households have spent an increasing percentage of their disposable income over the last decade to link themselves to the outside world. Other research, done at Rutgers University, suggests that the appetite for such services has not reached its limit: American families are spending only about half as much as they say they would be willing to pay for technologies that would perfectly meet their needs. That is heartening news for the companies that are trying to convince consumers of the virtues of high-speed Internet connections or digital cable or satellite television services.
….The notion of what constitutes a necessity varies from one household to another, but some services tend to become ingrained and all but indispensable. Both the telephone and television have achieved this status, with a presence in more than 90 percent of American households. While only 54 percent of homes have Internet access and about 56 percent subscribe to a wireless phone service, the Internet and the cellphone service are considered essential by many people.
….”The so-called information age and information economy are reaching down to the household level,” said Mr. Carey, who has tracked consumer spending on communications media since 1990…..
Our fees go to a package of basic cable plus the HBO channels plus cable modem broadband Internet service, we have both AOL and Compuserve accounts, and both my wife and I have cell phones we use sparingly – tres 2003, no?