The Crazy Price of Video Cables

Wednesday, 15 September 2010 15:02 by The Lunatic

In years past, when you purchased a VCR or a DVD player, it would come with a video cable so that you could go home, connect your new player to your TV, and immediately start watching.  It was usually a cheap combination audio/video cable – not very sturdy, but it would get the job done.

If you purchase a new Blu-Ray player today, however, you will find that not a single cable is to be found in the box. A high tech Blu-Ray player should really should at least come with an HDMI cable (High Definition Multi-media Interface, the preferred method of connecting any HD video source to a digital television).

 A decent quality cable costs less than fifty cents to make. Are the manufacturers just getting cheap?  Trying to cut corners?

Nope.  They’ve stopped including cables because the retailers have asked them to!

Let’s use Best Buy as an example retailer.  At most, Best Buy will make 20% margin on a Blu-Ray player. So if they sell a player for $200, they make about $40 in gross profit – but out of this $40 they still need to pay for the rent on the store, power bills, advertisements, salaries for all their employees, and all the other overhead that it takes to run a business. In today’s highly competitive market, they can’t charge more. So selling a Blu-Ray player by itself isn’t going to make them a lot of money.

Now, the story changes quite a bit if you are in need of an HDMI cable to go along with the player.

A “premium” HDMI cable costs about $2 to manufacture, vs. the fifty cent one (if it was included with the player).  What’s the difference between a fifty cent cable and a two-dollar cable?  Regarding the picture and sound quality, absolutely nothing. The higher end cable will last longer and probably won’t fall apart as as easily – but for any kind of digital signal like HDMI, it will not degrade your picture one iota as long as the cable meets the specification and isn’t too long.  Guaranteed – no matter what the salesperson tells you – the picture quality will be identical.

So an opportunistic company like Monster Cable makes a piece of wire with some pretty plastic around it, and adds a couple of connectors.  I don’t have anything in particular against Monster Cable; they have great marketing. However, from a technical standpoint their products don’t really add ANY value. Their manufacturing cost for an HDMI cable is probably about $2, which they can sell to Best Buy for around $10.  It’s a nice markup for a manufacturer like Monster Cable.

But then Best Buy puts it on the shelf and sells it for $45.

Yes, you heard right.  That $45 HDMI cable that they pressure you into buying will earn them about a $35 profit. So now our good friends at Best Buy have almost doubled their profit on the sale of the player. You can see why they don’t want the Blu-Ray manufacturers to include a cable in the box!

And if they can talk you into an extended service contract, they can just about triple their profit. Cables and extended warrantees are the biggest money making items that the electronics retailers carry in their stores. 

The friendly sales person at Best Buy will tell you all sorts of factoids about why you really need a premium cable.  They will discuss oxygenized dielectrics and the skin effect of electrons.  They get all goofy about gold planted contacts. They will spout off specifications, quote from color format tables, and explain how they measure impedance with impunity. They are trained to be fast talkers, and they all go through an extensive series of seminars to drill these terms into their heads, over and over again. 

But these classes aren’t based in sound engineering principles, they just teach the sales team all sorts of buzz words which makes everything sound more technical and confusing than it really is.

You can get a perfectly good cable for your Blu-Ray player on eBay for less than $5, including shipping.  Just make sure it conforms to the HDMI specification 1.3 or higher. This will work fine, even for the latest 3D gear running at 1080P resolution. (there is a specification for HDMI 1.4 – but that only has to do with the electronics, not the cable – unless you also want Ethernet over HDMI as well, then you do need a cable that supports the version 1.4 specification. It will still cost less than five bucks.)

And do yourself a favor: get the cable BEFORE you go to the store to buy a player, so you won’t have to wait to hook up your new toy. That way, you won’t be tempted to pay the outrageous amount that they will want to charge at the store.

Categories:   Economics | Miscellaneous | Science
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Comments (2) -

September 22. 2010 08:05

Great information!  I will note remember this when I purchase my Blu Ray player next month and maybe have some fun with the sales associate. I recently purchased an Xbox 360 and I was wondering why the graphics were pretty lackluster on my HDTV.  I then realized it only came packaged with a standard AV hookup.  Lucky for me happened to be giving HDMI cables away a few days later (with the caveat that you pay shipping and of course, end up on their email marketing list).  I actually got three of them so I'm assuming the connections are universal and will work with the Blu Ray I purchase.  Thanks for the insight!

ICC Cable

April 6. 2011 08:26

Great informational post on cables. This is the kind of info that everything needs to read before they make a purchase.

Freelance Copywriter

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