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Time Warner Cable Backs Down on $12,000 Installation Fee, Now Wants “Only” $4,000

Phillip Dampier September 22, 2010 Consumer News, Rural Broadband, TWC (see Charter) 4 Comments

Back in July, Stop the Cap! shared the story of Mark Williams, an eager new customer for Time Warner Cable in Lee, Massachusetts.  The only thing getting in the way of Williams’ desire to shower the cable company with money for its triple-play Internet, cable, and phone service was the $12,000 fee the cable company sought to install it.

That sparked a major incident with Lee’s Board of Selectmen, who called the installation fee “ridiculous.”  It warned the cable company they were prepared to vote Tuesday night to sanction the company, taking money from the $10,000 Time Warner posted with the town as part of its local license agreement, if it didn’t relent.

At issue was Time Warner’s reasoning for the high installation fee, invoking a “long driveway clause” Malcolm Chisholm Jr., of Lee’s Cable Advisory Committee argued was an incorrect interpretation of the town’s license agreement.  Chisholm told The Berkshire Eagle the contract entitles all homes to cable service if electric and telephone service already are available.

Before the board voted, Williams reported the cable company verbally agreed to reduce the installation fee to $4,000.

“They’ve given me a price, but it’s still not cheap,” Williams said. “I’m looking to find an independent contractor who will do the job cheaper.”

Williams acknowledged the cost would be even lower, but he wants the cable buried between his home and the nearest utility pole, which is 500 to 600 feet away. He has his electricity service underground to his home on Fernside Road, near the Tyringham town line.

Time Warner’s typical installation fee of $35 covers up to 200 feet — above ground — with the rest of any necessary cost borne by the subscriber. Williams said he didn’t seek a cost estimate from Time Warner for an above-ground installation.

[…]In a similar case three years ago, Time Warner agreed to drop its claim that a homeowner on Antelope Drive in Lee pay $1,102 for cable installation. The company’s decision followed the town also threatening the company with financial penalties. However, Time Warner officials said the reversal was based on the individual case, rather than agreeing to the town’s interpretation of the contract regarding installation.

Currently there are 4 comments on this Article:

  1. me says:

    What they are doing is picking a high price then later on coming in with a ‘reasonable offer’ (the level they really wanted). The idea is to set a price level in the persons head. Jewelry stores and car dealers do this sort of thing all the time.

    http://en.wikipedia.org/wiki/Door-in-the-face_technique

    The idea is the ‘real’ price is still ridiculous. But you come up with an even MORE ridiculous price that makes the ‘real’ price seem reasonable. It is an effective sales technique. Many sales classes teach it. The idea is people like to think they are getting a good deal. So you make it look like you are giving them one. When in fact you are giving them no deal at all.

  2. Scott says:

    I think you’re giving them wayyy too much credit here.

    At the Telco I worked at many years ago, our engineering department would regularly give out rediculously high quotes to people wanting lines run to their homes that were in the more rural areas out of the city. Given mostly union work, high pay, and of course the company multiplying their costs several times over for the install, seeing a quote in the range of several thousand dollars wasn’t unheard of. For the most part they just simply didn’t want to run the lines to remote customers.

    Generally the employees giving the quotes are just doing what they’re told by management, it’s not until a lot of bitching by the customers of a period of time, or media pressure that you see a response by management telling the employees they can bring down the quote to actual cost just to shut the person up.

    • me says:

      Exactly. Give a huge number up front (hey they might pay it). Then if the person negotiates then lower the price to a ‘reasonable’ level ‘I am giving you a good deal here…’ or ‘i might get fired for this but I will give you an employee discount’.

      It is called anchoring.

      http://en.wikipedia.org/wiki/Anchoring

      The idea is to give a huge value that someone will hang some sort of value on. Then give a lower (but still eye popping price) price later. The sales people want to drive what information you have or do not have. They want to control the conversation. Or as me dad would say ‘take over the conversation up front and tell them only what they need to know then make it look like they came up with the idea themselves.’

      One friend I had lived in a neighborhood. They wanted to charge him 3k to hook up. Even though all his neighbors 50ft away had it. Then later on they show up with a much lower quote.

      It works because people do not normally do these things and do not really know what things are worth. For example you ask me how much a computer is worth and I will get it close. Ask my parents and they will have no idea. It would be very easy to use the ‘it is a 2k computer but I will give it to you for 1100 bucks’ on them. For me I do not dig lines across yards for a living. So I have very little idea what it is worth but you do.

      The period of time is the ‘let me go ask my manager’ technique of this scam. Car dealers do this all the time. When they are ‘asking their manager’ they are really going to get a cup of joe. Heck some even go and talk to the manager. But not about the car they are selling you. What they are doing is giving you time to talk yourself into it but ‘at a lower price’. Then magically they show up with a lower price but just slightly higher than what you were thinking.

      Even with the place you worked I would bet there was a sales droid assigned to the customer. They would tell you to give out ‘huge quotes as we do not want to do the work’. Then turn around and say to the customer ‘well I ran the numbers and I think we can get you a wholesale deal’. Notice who was telling you to tell the customer to buzz off, your management. Your management was probably working directly with the sales force. The idea is the less people in on the con the better. Would also bet the sales droid was feeding the lines of ‘we have too much work’ and your management was just saying what they were told.

      It is fun to get sales droids talking (it doesnt take much) they love to boast about how they ripped of some sucker. If you ask them right they will even tell you exactly how they do it.

  3. Uncle Ken says:

    It would be very useful if a tradesmen or contractor even if their main
    business is digging house foundations chimed on just how much a
    500 foot ditch cost. Then a provider contractor chimed in how much
    more the actual line laying and hook up would cost in their their own
    thoughts not the company they works for. But you dont need a ditch.
    One of those things that cut 2 inch dig (looks like a concrete cutter)
    You know what im talking about. Had one for a house and it took them 10
    minutes from road to house. cable was in.
    l

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