Why Americans Loathe Cable Companies

HughPickens.com writes: Vikas Bajaj writes in the NYT that the results are in and the American Customer Satisfaction Index shows that customer satisfaction with cable TV, Internet and phone service providers have declined to a seven-year low. Of the 43 industries on which the survey solicits opinions, TV and Internet companies tied for last place in customer satisfaction. "Internet and TV have always been among the lowest scoring," says David VanAmburg, director of the Index. "But this year they're at the very bottom." The study, which is based on more than 14,000 consumer surveys, gives companies a rating from 0 to 100. The ACSI reports huge drops in customer satisfaction for Comcast and Time Warner Cable, following their failed merger. Already one of the lowest-scoring companies in the ACSI, Comcast sheds 10 percent to a customer satisfaction score of 54. Meanwhile, Time Warner Cable earns the distinction as least-satisfying company in the Index after falling 9 percent to 51. Joining Time Warner Cable in the basement is ACSI newcomer Mediacom Communications (51), which serves smaller markets in the Midwest and South. "Customer service in these industries has long been bad," says VanAmburg of Internet and TV providers. "They don't have a good business model for handling inquiries with efficiency and respect. It goes back a decade plus."

Even though those complaints are longstanding, customer frustration has risen along with the ever-rising prices. "You compound all that with the prices customers are paying, and that's the final straw," says VanAmburg. "They're opening bills each month and saying 'I'm paying how much?'" In an age of over-the-top viewing options like Hulu and Netflix, customer dissatisfaction may increasingly translate to companies' bottom lines. "There was a time when pay TV could get away with discontented users without being penalized by revenue losses from defecting customers," says Claes Fornell, chairman and founder of the Index. "But those days are over."

Comments

Haggling for Rates

[DrLang21]

For a service that I used only a handful of times a week, the straw the brolemthe camel's back for me was the automatic rate increase every year until you call to complain. That's just abusive and degrading. I don't want to haggle for my service. Offer me a price that is fair to both of us and make it the same for all customers with the same service. Allowing me to haggle just means you don't value my time.

No options.

[blueshift_1]

I think the biggest issue is that you're locked into a provider by area. What makes people (including myself) angrier than having terrible customer service is having terrible customer service and no real alternatives to choose from. For TV you pretty much have one cable provider, maybe verizon/AT&T as an alternative, and the various satellite providers - which isn't the worst. However for internet, the satellite providers are slow - so only useful if you can't get DSL or cable. So you have one cable provider and maybe one DSL. Both have jacked up prices and terrible service; then you just accept it, pick the cheapest one(which isn't that cheap), and grumble on reviews. Oh and if you live in one of the few places that have google fibre or similar then you naturally take that. What it comes down to is that the monopolized system has hurt the customers (surprise, surprise).

Re:No options.

[fuzzyfuzzyfungus]

I suspect that it used to be good for the internet that it wasn't considered a utility, given the risk of being misunderstood and folded into some aspect of Ma Bell's 'regulated monopoly' as the non-line-switched stepchild; but now that the incumbents have caught on, and realized that the internet is both a serious threat to cable TV and wireline phone; and that there is lots of money to be made by using your man-in-the-middle position to extract rents from activity on the internet; that time has probably passed.

I don't need a municipal ISP; but I'd be delighted to have my municipality run fiber to a peering point with the same competence that they've shown with handling my utility hookups. Once you get the last mile out of the way, competition becomes something more than a quaint theory again, so you can let the market take it from there; but as long as the last mile is, at best, a duopoly, and in the hands of incumbents who don't really have incentives aligned with the good of the internet; we have a problem.

Re:No options.

[lgw]

That's the right way to look at it: we don't need "ISP as utility", we need "last mile as utility".

A local utility that just maintained the pipe to my house would be a great idea, and let any ISP who wanted compete for my business from there. There are a few places in the US where some quirk still makes independent ISPs possible, and those guys are great. Anything that gets us back to the possibility of independent ISPs in addition to competition between the big guys will fix the remaining issues.

Re:Google Fiber

[fustakrakich]

I would put my trust in municipal and state fiber before taking a chance with Google, which could just call it quits on a whim if precedence is to mean anything. Circumvent the politicians and put the initiative on the ballot.

That's the easy question

[Minwee]

The more interesting question is "Why do American cable companies loathe Americans?"

Re:Google Fiber

[Overzeetop]

No, they wouldn't. CableCos are doing fine where GF has rolled out. Of course, in those areas the consumers are paying 1/2 the cost for 10x the bandwidth because there's actual competition. And they're making money there just fine - they're just not making *as much* money as they are where there aren't competitive markets.

They can provide higher speeds at lower rates - especially for internet where there is no "content" fee involved (as it is with programming) - with very little affect on their bottom line. They just don't.

Re:Google Fiber

[njnnja]

I don't know about your specific state or municipality, but with so many of them cutting exclusivity deals with the local cable company I don't think there are many that could be trusted. As soon as Comcast promises to give a couple new computers to some local school you can be sure they will find some reason why the municipal fiber will have to be shut down. You might be able to install muni fiber by ballot but you can't run it that way.

Re:Google Fiber

[MightyYar]

No question that this happens with private companies. Back to the internet, look at the current state of telecommunications in places with a private telephone monopolies... Verizon in my area still only offers copper service. And while it generally "works", it hasn't had any updates since the 90s, yet the rates constantly go one direction - up.

I was just pointing out that handing the responsibility over to the government won't necessarily buy you anything. If they don't have the will to regulate a monopoly provider, they probably aren't going to be very responsive when they own the business. It's practically the same situation.