Wider World by CS

10 things not to buy in 2014

By AnnaMaria Andriotis 

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1. Cable TV

Cable television’s heyday is over. Subscribers have been declining since 2004, and analysts say there’s no end in sight. Roughly 54.8 million households currently pay for cable TV, down 3.3% from 2012 and down 17.6% from a decade prior, according to research firm IHS. Cable companies are expected to shed roughly 1.3 million subscribers in 2014.

The decline is due in part to so-called cord-cutters: consumers who are canceling cable and transitioning to lower-cost services, such as Hulu and Netflix (NFLX) , which provide much of the same programming at a fraction of the price. Using an Internet connection, consumers can stream many cable shows, news programs and sports games, as well as movies, directly to their TVs. Some channels’ websites also provide viewers access to their shows. (MarketWatch recently launched a calculator — Are you ready to cut the cord? — that allows consumers to find the shows they normally watch through such lower-cost options.)

These services are mostly beneficial for people who do not mind watching shows after they’ve aired and are willing to part with most live programming.

2. Landline service

Fewer households are holding on to their landlines. Two in every five U.S. homes had wireless phones only during the first half of the year, up slightly from the first half of 2012, according to data released this month by the Centers for Disease Control and Prevention. The number has been rising over the past decade: Roughly 90 million adults, or 38% of the population, are now wireless-only, versus 21% during the first half of 2009 — and fewer than 3% during the first half of 2003.

Ditching the landline allows households to shed a monthly bill — but it doesn’t mean they’re restricted to their cellphones. There’s also Skype, which is free and allows video chatting via smartphones and other devices with friends and family anywhere in the world at no cost. FaceTime video can also be free with a Wi-Fi connection. Separately, magicJack Plus provides phone service when it’s connected to a USB port, computer, or regular phone router; it costs $49.95 in total for the device and for the first six months, after which service costs range from about $1.67 to $2.50 per month. (In contrast, most traditional telephone providers charge at least $10 a month.)

To be sure, these services require an Internet connection. Consumers who want the security of a landline — many Americans were without phone service after Hurricane Sandy disrupted cellphone and Internet service in some areas — may want to consider holding on to their home phone.
3. GPS devices

Up until a few years ago, personal navigation systems were considered a must-have for most drivers since they drastically reduced the chances of getting lost. But the tides have turned and demand for these gadgets is plummeting: 7.5 million personal navigation devices sold in 2012 in North America, down from a peak of 18 million in 2009, according to the latest data from Berg Insight, a Swedish research company.

The need for this service still exists, but consumers can get it for a lot cheaper. Rather than paying $70 to $300 for a new GPS device, drivers can use map apps to get around. They’re available on most smartphones or free to download.

Separately, many new cars come with built-in navigation systems: 49% of 2013 model-year vehicles have a standard navigation system (in at least one of their styles), up from 33% of 2010 models, according to Edmunds.com.
4. DVD and Blu-ray players

DVD sales and rentals are down, so it’s not a surprise that fewer consumers are buying DVD players. Sales of DVD and Blu-ray players totaled 21.3 million in 2012, down 20.1% from a year prior and down 24.8% from 2010, according to research firm SNL Kagan.

Instead, experts say, consumers are increasingly streaming movies from Internet-based subscription services like Hulu and Netflix. Gamers can also use their consoles, such as the Xbox One and PlayStation4, to watch DVDs.

5. Hotel rooms

As more travelers book vacations, demand for hotels is rising and so are room rates. The daily rate at U.S. hotels averages $110.59 this year, up 4.1% from 2012 and up 12.6% from 2010, according to professional-services firm PricewaterhouseCoopers. The average price is expected to rise to $115.68 in 2014.

There’s another, cheaper alternative: Travelers can reserve apartments or homes in their destinations at a lower price with more space to boot. Several services, such as Airbnb and Vacation Rentals by Owner, allow consumers to choose from an assortment of homes to stay in. Some owners also offer free airport pickups and drop-offs.

It can also be more helpful and cost-effective for large groups that are traveling together (you can book a large home with many bedrooms) or families with young children who require privacy and can cook in the home rather than paying to eat out. The downside, however, is less security than what hotels offer.

6. Two-year phone contracts

Consumers are encountering more setbacks than benefits with two-year cellphone contracts. There’s no way to change phones within this period of time without incurring a fee. And there’s the fine print many of these plans come with that result in consumers paying more than the starting monthly price they’re quoted in the store.

Mobile users have several alternatives. They can opt for no-contract providers that sell the phones at full price (that’s more than the upfront price they’ll pay for a phone with a contract) but monthly payments are much lower (often half). They’re available through MetroPCS as well as big-box retailers like Best Buy and Wal-Mart. Most regular wireless providers also offer this option.

7. Desktop and laptop computers

There’s little reason to buy a desktop or laptop computer anymore. Tablets perform the same functions — playing music, sharing photos, Web surfing — that most consumers use PCs for and they’re made to use while on the go. They can also be a lot cheaper. For instance, Apple’s iMac’s start at $1,299 and MacBook laptops start at $999 while iPads start at $299.

Of course, ditching desktop PCs isn’t for everyone: Graphic designers and traders, for instance, who require large screens will find it hard to part with traditional computers.

But data shows that PCs are starting to fall out of favor: Worldwide shipments fell 4% in 2012 from a year prior — to the lowest level since 2009, according to the latest data from IDC, an information-technology research firm.

8. Extra legroom in economy

Over the past few years it’s become common practice for airlines, including American Airlines and Delta Air Lines, to charge many passengers extra — up to an additional $180 — for roomier seats (read:extra three to six inches of legroom) in coach. These seats are often in the exit rows or first row in economy.

But for a similar payment of $100 to $200, travelers can get upgraded to business class where the seats are much more comfortable and the service is of a higher caliber. These upgrades used to be reserved for airlines’ frequent fliers, but many now give them out to passengers who are willing to pay a bit more when they check in or at the gate.

9. Credit cards with points or miles programs

Card issuers have been ramping up some of their rewards programs in the past few years, but consumers should steer clear of one common promotion: credit cards with rewards programs that are comprised of points or miles.

Many card issuers are devaluing their rewards programs by requiring cardholders to spend more in order to get the same “free award” they could have gotten previously with fewer points. What’s more, many of these cards come with annual fees, ranging from $30 to $75.

Instead, consider a credit card with a “cash-back” program — a rewards program that’s a lot more straightforward: consumers get 1% to 5% cash back per a certain number of dollars they swipe on their card.

10. Digital cameras

Their small size and sleek look made digital “point and shoot” cameras all the rage for years. Now, demand is sunsetting. Roughly 11.5 million are estimated to have sold this year in the U.S., down 44% from 2012, according to the Consumer Electronics Association, which represents consumer technology companies. Sales are expected to drop to just under 8 million next year.

The cameras are suffering from an identity crisis. Consumers who want high-quality photos are opting for the larger, DSLR (digital single-lens reflex) cameras. Others prefer to stick with just one gadget — their smartphone — which takes pictures.

And there’s new competition from cameras intended for the outdoor thrill-seeker, like the GoPro, for people who want photos capturing action (the camera attaches to your body while white water rafting or scuba diving, for instance) rather than stopping to pose for a pic.