Internet, cable and cell phones make up the new home utilities

Posted: 07/07/2009 at 5:55 am

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ELKHART -- Times are tough, the economy is down and many are tightening their belts.

That doesn't mean those with mobile phones, cable TV or Internet access will be getting rid of the services any time soon. These days, such high-tech amenities, far from being mere luxury, have entered the realm of the indispensable for many.

"We have seen no indication that people are canceling their mobile phone service because they consider it a luxury," said Carl Howe, who handles consumer research for the Yankee Group. Rather, for many, such offerings are "a utility, a necessity."

That said, the cost of "household connectivity," as Yankee calls it, isn't cheap. The average U.S. household spent $220.04 per month last year on cable TV, Internet and mobile and landline telephone service, according to the Boston-based technology research firm.

And assuming you're not down to the last can of food in the cupboard and extreme action is in order, there are ways of scaling back without having to abandon your electronic links to the world. Here are a few:

Cord cutting: Do you talk mainly on your mobile telephone? If so, maybe you can cancel your landline service -- cord cutting in industry jargon -- to save a few bucks.

More and more people are doing it, according to Yankee, and the company expects the trend to intensify. Nearly 16 percent of respondents to one of its consumer surveys in 2008 said their mobile phone had replaced their landline, up from 12.3 percent in 2007.

Of course, if you get cable TV or Internet service over your landline, cord cutting may not be an option.

Pay-as-you-go: Rather than inking a contract obliging you to pay a set amount every month for a predetermined period of time for your mobile telephone, get pre-paid service, counsels Russ Rupp, an accounting professor at Goshen College who teaches personal finance. Thus, you can vary the level of service from month to month -- and the corresponding cost -- to match your changing financial situation.

Ax the perks: Do away with all the bells and whistles on your mobile telephone plan.

Rupp says service providers may advertise a special service for just $10 a month. But if you have a family plan with four phones, the extra cost quickly adds up, to $40 per month and $480 per year.

Coaxial cord cutting: You can always cancel your cable TV service -- known as coaxial cord cutting -- and just watch what the over-the-air stations have to offer. If you have Internet service, there are an increasing array of TV offerings there as well, precluding dependence on cable.

Coaxial cord cutting is a newer trend, however, and Yankee reports that only 3.5 percent of respondents in one it its surveys had eliminated cable or satellite in favor of TV offerings over the Internet and other alternative media.

The dearth of devices enabling viewing of Internet programming over TV sets is one factor boding against "cutting the coax," according to a Yankee report on the matter. "But there is a shift occurring in the market."

Ease back on the pay TV: If you have satellite TV service and don't want to do away with it completely, reduce your plan to exclude the over-the-air stations and get those with the help of high-tech rabbit ears instead. Sue Lumadue, a salesperson at ABC Warehouse in Elkhart, says some customers there are doing it, though they may have to purchase digital converter boxes so their older, analog televisions can capture broadcast signals.

Likewise, if you can't bear getting rid of cable TV, just get rid of some or all of the premium channels, such as HBO.

Downgrade your Internet: Paul Penrose, chief financial officer for New Paris Telephone, a telecommunications firm that operates in the southern part of Elkhart County, said some customers are opting for slower Internet connections to save a few bucks without having to do away with service altogether.

Bundling: As consumers look to save money, Yankee foresees an increase in bundling, the packaging of telephone, Internet and pay TV offerings to consumers for a single fee by a single provider. However, the firm advises providers against "bait-and-switch tactics," that is, offering multiple offerings at a special introductory rate that will eventually expire, giving way to a dramatically higher rate.

New Paris Telephone offers Internet, subscription television service and landline telephony as part of a three-service bundle and its considering offering a two-service deal as well, according to Penrose.