What is the best electronic entertainment value?

Which really costs more, a $60 Xbox game or a 99¢ iTunes song?

How we consider entertainment’s value is related to subjective and personal criteria. We all consume multiple forms of entertainment. You may subscribe to HBO or satellite radio. You may buy DVDs or CDs at Wal-Mart or download songs from iTunes. Some of us rent movies at Blockbuster or purchase video-on-demand from Cablevision, Comcast, DirecTV or Dish Network.

Did you ever wonder which media are good values for the dollar, and which are not? It is difficult to compare the different forms of electronic media, but not impossible. Let us make some assumptions and examine the results. You may be surprised.

My long-ago MBA training suggests we need a numerical measure to compare alternatives. I used cost-per-hour. For example, if you go to a Broadway musical and pay $100 for your ticket for a two-hour show, the cost per hour is $50.00. This says nothing about how much you enjoyed the show. This calculation does not include the $75 you paid for dinner before the show and $30 to park your car. Clearly, a Broadway show is not going to win this competition as the best bang for the buck! This criterion does allow us to compare different electronic entertainment alternatives.

The alternatives can be divided into subscription services versus purchases or rentals. The subscriptions I compared are satellite radio plans, XM or Sirius, HBO, the Rhapsody music service, and Audible’s books-on-tape. I also looked at CD purchases, iTunes purchases, DVD purchases, movie rentals, and purchased games played on gaming consoles. You can rent games but I did not look at that alternative. Subscription services cost per hour is based upon assumptions of monthly use. This is as opposed to assumptions about how much a purchase, such as a CD or DVD, is used in total before it is relegated to one more thing we own but never use again.

Some additional assumptions I made are - all videos are watched by two people on average and only once, all audio-only content is listened to by one person, games are played by 1.5 people on average - this is because people sometimes play games by themselves and sometimes compete with others. I ignored multi-player games played over the internet. I also ignored the costs of basic subscriptions for cable or satellite, and the cost of equipment—DVD players, game consoles, HDTV’s, DVRs, etc.

Based upon all my assumptions (and recognizing that your mileage will vary) the best deal is satellite radio at $0.30/hour. Rhapsody’s music service at $0.75/hour was second. These seem like reasonable rates. I assumed you listen to satellite radio in your car an average of 10 hours/week (40 hours a month), mostly commuting. I guessed if you subscribe to Rhapsody, you listen 5 hours a week (20 hours/month).

The most expensive forms of electronic entertainment are purchased DVDs at $6.00/hour ($18 to buy a 90-minute movie which is watched by two people, once) and an iTunes song at $2.00/hour ($1 to buy a 3-minute song, listened to a total of ten times). Purchased CDs were the third most expensive item at $1.73/hour ($13 to buy a 45-minute CD listened to ten times).

The good value for games purchased to play on consoles like the Xbox surprised me the most. They are expensive to acquire often costing over $50. Some hot titles go for over $100. However, they get used a lot. I guessed that a $60 game gets used for 60 hours of total game playing (40 hours times 1.5 players). This means the game costs $1.00 per hour or half the iTunes rate, a better deal than seven other forms of electronic entertainment.

Who knew?