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All you need are styrofoam cups, an empty 2 litter pop bottle and tape. We are in a big cold snap right nowand my local Home Depot was sold out of faucet covers, so I came up with an even better idea.
I took three large styrofoam cups (20 oz. size from the $1 store) and stacked them all together inside of each other. I then cut off the top lips of the top 2 cups so the cups were no taller than the bottom cup. These go on to the spout first and if you like, you can just tape these cups on to the faucet and leave it at that, but for added protection I cut the bottom half off of a 2 litter pop bottle and put this over the cups. In between the cups and the bottle-bottom I put quilt batting for extra insulation, but you could also use fiberglass insulation, spray in foam or even just a rag. Lastly, I duct taped this to the side of my house. I bet you could also drill a hole and uses zip-ties to secure it.
Ingenious idea! I wish I'd read this before buying a faucet cover for $3-4!
When my outdoor faucet froze and sprunk a leak I went to a hardware store and bought a new outdoor faucet especially made for cold weather. The pipe is about a foot long that is attached to the faucet.
Another way to prevent the pipe from freezing is to find the shutoff valve. We were terrified that our outdoor faucet was going to blow because it seemed to have sprung a leak that left us with a small glacier attached to the back of our house after the first real freeze. (It's also a frost-proof faucet like Harry's above) I poked around a bit and found that just inside our wall (in our mudroom with exposed pipes, but it could be just inside your basement wall) there was a shutoff valve. This prevents water from getting close to the outdoors where it can be disastrous. It gets way too cold here for faucet covers to work, so this was a lifesaver.
Here in Sask we all must have faucets that are frost proof, because no one does anything special at all, and no one has any problems. The temp goes to -40 or lower, so if things were going to freeze up, they would certainly do so.