Should You Buy or Rent Your Cable Modem?

cable modem

If you buy internet for your home or apartment, chances are you’re paying not only for access, but to rent a modem from your internet service provider (ISP). This fee varies, but Time Warner Cable currently charges $6 per month for modem rental, and Comcast charges $7. Other companies are similar. Considering what you probably pay for rent or food, modem fees may not seem like a huge expense, but what if you didn’t have to pay them? Depending on your ISP, living situation, and other factors, purchasing a modem may actually save you money.

What does the ISP say?

Most, but not all, internet service providers allow customers to purchase their own modem in lieu of a rental. You’ll want to verify that yours does before parting with the cash. If your service is compatible with third-party modems, you should find a list of allowed devices on your provider’s website.

While you’re at it, contact your ISP and ask if it plans to upgrade its services anytime soon. Doing so will help you avoid purchasing a modem that will become obsolete before you recoup your costs.

Will you stay put?

If you have no intentions of moving over the next few years, it’s better to buy a cable modem. While ISPs upgrade their services every so often, they typically don’t do so often enough to make renting worthwhile. In other words, even if you want (or need) to keep up with equipment upgrades, buying will save you money if you’ll stay put for a while.

Conversely, if you anticipate moving in the near future, renting is a better bet. After all, there’s no guarantee your existing modem will be compatible with a different ISP’s service, or that they’ll let you buy one at all.

Technical literacy

If you speak in code and can hack any modem on the planet, you’ll be better off making a purchase. However, if you don’t know much beyond plugging your modem in, renting may be the best option. ISPs typically service rented modems, but not those purchased elsewhere.

That said, you can circumvent this problem by purchasing a reliable device. Read online views and check with your more technically literate friends for advice so you can buy one that doesn’t need frequent service.

Payback Period

While cable modem prices vary widely, they’re generally very affordable. For instance, if you’re hoping to beat Time Warner’s $6 per month rental fee, you can purchase a Motorola SB5101 for around $50. It would take a little over eight months to break even with a rental. As this modem should be sufficient for years to come in most areas, buying one is a no-brainer if you’ll stay put for a while and are reasonably confident in your technical literacy. However, if the only modems your service provider accepts are in the $100+ range, and you can’t commit to using the same ISP for more than a year, consider renting instead.

For the less stable or tech-savvy, renting a modem does have some advantages, but overall, buying will save most users money. Just be sure you go with a high quality device that won’t eat into your savings with repair costs, and keep your ISP updated about your purchase. Some may continue to charge you rental fees even if their modem is no longer in use. Once you’ve done your research, though, you’ll have – hopefully – a better modem, and save money at the same time.

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