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Originally featured on BroadcastEngineering.com
Jan 21

Written by:
1/21/2011 6:00 AM  RssIcon

scissorsAre you satisfied with the price and service, called value proposition, from your cable/satellite company? According to survey after survey, probably not.

According to an October 2010 study from J. D. Power and Associates, customer satisfaction with the cost of subscription TV service averaged 541 on a 1000-point scale in 2010. That’s down 14 points since 2009. Customers of traditional cable providers are particularly dissatisfied with their cost of service. Satisfaction with fairness of prices paid among cable customers is 22 percent lower than among customers of telephone company providers (such as AT&T and Verizon) and 18 percent lower than among customers of satellite providers (such as DIRECTV and DISH).

According to Frank Perazzini, director of telecommunications at J.D. Power and Associates, "It's apparent, however, that TV providers must better communicate their price-value proposition, as customers are increasingly voicing irritation with the amount of their monthly bill. Seventy-four percent of customers who say they definitely or probably will change TV providers in the next year cite price as a major reason to switch."

I’ve actually never met someone who was pleased with the service and price of his cable/satellite company. Instead, if you inquire about a cable/satellite provider, you’re likely to get a 20-minute diatribe about how awful the service, price, delivery, quality, blah, blah, blah, etc., is. It’s almost like people hate cable/satellite as much as they do the IRS.

I finally cut the (cable) cord — at least a little bit. I didn’t completely cut off my cable company, but I came as close as I could for now.

Just more than a year ago, my SureWest cable bill went from about $100/month to $130/month; a recent bill was more than $150/month. Twelve months ago, a visit to the company’s office, along with a copy of a competing offer from Time Warner, got the bill lowered back to $100/month. But in late 2010, the bill went to $150/month, the current rate.

Back to the SureWest office I went, this time with less positive results. The very young woman there basically said, “Too bad, so sad, can’t help you.”

The frustration I felt was immense. I was hoping for a more cooperative response. Perhaps something like, “Gee, let me see what I can do.” Hey, cable company person, at least make it look like you’re trying to help the customer. Instead, she said the price was fixed and no change was possible.

Up the corporate ladder I went to what’s called the retention department. I think the cable company’s game is that it raises subscription rates knowing people will grumble, but most will remain customers. Those that do complain are given another 12 months at the old price, and then bumped to the new, and by then even higher, rate.

As the retention person and I discussed the bill, it became clear that I wasn’t going to get my $100 subscription rate back. When I reminded her of the $100 service offer I had from Time Warner, she said, “Maybe so, but if you change providers, you’ll have to stay home from work waiting for a technician.” I’m seeing a broken record pattern here: “Too bad, so sad.”

In my case, the representative did agree to reduce the bill by $20/month, which would make my bill equal to last year’s regular price. Now my rate would be $130, which I still believed was too high for the service I was getting.

To further lower my cost, I decided to drop the HD tier, which included a DVR set-top box. That lowered the monthly price another $10. Little did I know, I was losing more than HD.

Armed with my new, tiny and crappy-looking set-top box, I returned home to install it. The first thing I discovered was that the box had no RGB outputs. I had a choice of S-video, composite video or RF, and no DVR capability.

But, sometimes, it’s the small things that really tick you off. In this case, it was the remote control.

It seems that this remote can’t be programmed to drive my not-so-old Sony TV. Yes, the instruction sheet says the remote should drive the TV, but it doesn’t. I suppose there are two options: Either take my 57in TV down to the SureWest store to see if one of their technicians can program the remote control, or I can pay for a service call to have a technician come to the house. Neither option seemed reasonable.

I thought of a third option: Perhaps I could exchange the current remote control for the previous remote control because it might drive both the set-top box and my TV — nope, too bad, so sad.

The bottom line is that while I did manage to get the cable bill reduced by $30, I also gave up services and performance I enjoyed. I no longer have HD or a DVR. Even more maddening is that now I have to deal with dueling remotes because the cable remote control won’t drive my TV.

According to SNL Kagan, the total number of cable/satellite subscribers fell by 119,000 in the third quarter of 2010, compared with a gain of 346,000 in the third quarter of 2009. That represents the largest decline in the younger and technically sophisticated viewers in 30 years.

I suppose that the key reason behind the loss of cable/satellite subscribers is that the sector has one of the worst customer service records of any industry. In the American Customer Satisfaction Index, based on surveys of U.S. households, the four largest cable TV providers (Comcast, Time Warner Cable, Cox Communications and Charter Communications) have averaged 59 on a scale of 1 to 100 since 2004. While the numbers improved for 2010, cable TV still ranks below the airlines, which is a business everyone hates.

Figure 1. Cable/satellite customer satisfaction rankings. Courtesy ChangeWave Research.The satisfaction rating of cable and satellite companies as measured by ChangeWave Research is shown in the figure. Note that the rating of Verizon FiOS is almost 10 times higher than that of Charter Cable. Even more telling are the rankings of the nation’s four largest cable companies, which have an average “satisfaction rating” of 10.75 percent.

Ask yourself, how can a company stay in business when fewer than 11 percent of its customers are satisfied with its service? The answer: insufficient competition.

Will more viewers eventually “cut the cord”? Darn right, just as soon as myself and millions like me have an alternative.

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