Why Now is the Time to Ditch Your Cable Service

With the economy in major flux, Americans are thinking about cutting corners. And according to Nielsen’s VideoCensus report for the month of September, some have already found a way.

We’re watching television online.

TV on your computer isn’t a new idea. Most of us have visited YouTube (STOCK QUOTE: GOOG) and watched a few minutes– a viral video, a clip from a TV show, or a how-to video produced by a helpful stranger. There’s plenty of content, but turning in your cable box for YouTube might feel like trading a novel for a collection of essays written by second graders. It’s cute, but rarely entertaining beyond its novelty.

That’s where sites like Hulu.com and Veoh.com come in.

Hulu.com, a joint venture between NBC Universal (STOCK QUOTE: GE) and News Corp. (STOCK QUOTE: NWS) offers television shows and films free of charge. It’s also growing quicker than any other video site.

According to Nielsen, Hulu.com amassed 142,261,000 streams in September compared to 105,830,000 generated in July. The Nielsen VideoCensus now ranks Hulu number six behind more established video sites such as Nickelodeon, MSN/Windows Live, Fox Interactive Media, Yahoo (STOCK QUOTE: YHOO), and, of course, YouTube. Another source, Compete.com, reveals that Hulu’s unique visitors have increased more than 52% in the last month compared with YouTube’s 0.6% increase in traffic.

Hulu’s success, and the success of similar sites, is due to the full-length TV shows and films it offers. But streaming TV through your computer does come at a cost. Unless you have an Xbox (STOCK QUOTE: MSFT), Sony Playstation (STOCK QUOTE: SNE), or a computer hooked up to our TV, you will have to watch on your computer screen. Also, shows do stream in lesser quality than when they’re broadcast on cable. But, that’s changing too. Hulu and Veoh are starting to provide some content in high definition.