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Cable One: Your Price and Customer Service Depend on Your Credit Worthiness

Phillip Dampier June 29, 2016 Cable One, Consumer News, Public Policy & Gov't 8 Comments

no-thanksFirst credit cards were tied to your credit score, then auto insurance, and now how much you pay for cable television and what kind of support you receive from customer service may also depend on your creditworthiness, at least at Cable One.

CEO Thomas Might ignited controversy over his remarks at a recent J.P. Morgan Global Technology, Media and Telecom Conference when he told Wall Street analysts the company was working hard to reduce the “hollow profitability” of its cable TV business. Fierce Cable caught the transcript. One of the biggest reasons to blame for low profits may be Cable One’s deadbeat customers who don’t pay their bills. Starting in 2013, Might ordered a “very rigorous FICI credit scoring process” on all video customers to weed out the good from the bad.

Might suggested Cable One discovered those with low credit scores were among the company’s low value customers, and they deserve much less from the cable company in return.

“We don’t turn people away,” Might said, but the cable company’s technicians aren’t going to “spend 15 minutes setting up an iPhone app” for a customer who has a low FICO score. “What we found is that through lifestyle and billing analysis, we could start to pinpoint where churn and bad debt was coming from, and credit scoring started to be a really good test.”

cable oneCable One has even stopped direct marketing its cable service, even though it was winning nine percent of new customer sign-ups. The customers Cable One attracted were so low quality, Might claims the company didn’t make a penny from the marketing effort.

“It was the worst of the lifetime value segments we had,” Might said.

Cable One’s unwelcome credit challenged customers returned the favor and canceled their service in droves. Although bad debt is down 70 percent under the new credit check policy, Cable One has lost about half of their cable TV customers, most leaving for AT&T U-verse or satellite television.

Might

Might

Might’s intemperate remarks evidently triggered the company’s recent decision to contact the FCC to “clarify” the situation. Chief operating officer Julie Laulis tried to quell any controversy Cable One treats its customers differently based on how they handle their credit.

“Cable One runs a consumer credit pre-qualification, with the applicant’s consent, solely during the new customer sign-up process,” Laulis said. “The pre-qualification results are used to determine the size of the deposit and the installation charge, if any, that would be appropriate for the particular customer to offset the customer to offset the non-payment of bills or the non-return of equipment, as well as any introductory offers the customer may be eligible to receive.”

But once signed up, Laulis admitted the company still treats customers differently based on an internal scoring system it calls Lifetime Value (LTV), which determines what perks and special deals each customer is qualified to receive.

“Importantly, the LTV program has nothing at all to do with the use of credit scores,” Laulis added. “Any Cable One customer can, through a good payment history, achieve the highest LTV level and achieve additional levels of customer service and other benefits. This LTV level is independent of a credit score, and a credit score is not used to determine levels of service or loyalty rewards.”

Laulis claimed “the media” confused Might’s positions on credit scoring inside Cable One, although the cable company never asked for any corrections. Laulis also doesn’t deny the amount of customer service assistance available to customers may still depend on their creditworthiness.

Currently there are 8 comments on this Article:

  1. Really says:

    Ok so this is what they do now. If you’re already rich, they reward you by kissing your feet every time you step in the bath tub but if you honestly could use a little extra help in life you not only get less than equal treatment but you are also punished for not being a CEO at some law firm?

    See there is a difference between actually paying for extra services and price gouging and this kind of treatment is just price gouging using a loophole only instead of charging more for nothing extra it’s just refusal of service to a paying customer which is really one in the same. There’s no confusion here, it was all set up by corporate lobbyists so elitist corporate junkies who know nothing about life it’s self as they have lived in gated communities with golden arches can decide who deserves to get a little respect in life causing more of the same problem that has been putting lesser privileged HUMAN BEINGS in deeper in the same positions they were already struggling to get out of before signing up to this company. Mean while they monopolize everyone’s home towns and cities while they make up usage numbers that are completely false forcing you to pay yet even more money that you really don’t even owe the, and then if you don’t pay they charge you 4 times what the bill is and call it a “re-installment fee”even though they bill you on a day before the average pay check comes in to most customers intentionally so you can’t pay them living on a day to day paycheck knowing now they have you by the balls to pay the penalty.

    What I find really amazing are the names of these people “Might” and “Laulis” which with the second name if you pronounce it right sounds and awful lot like Lawless in which makes me think they are showing their might by being as lawless as they can be which fits when you consider these are the people who admitted went through Wall-street to come up with the plan in the first place which some how the details had to be clarified by the FCC who obviously wrote up the plan AND came up with the saving excuse to tell everyone when they realized it was really just pissing everyone off and knew it would with the fact they never told their users a cap was coming at all to the plan as supposedly they fought so they would never have to put a cap on their service but some how a warning just came up on my screen saying we are over 130 over our cap limit at the time the last bill was paid SO… that being said, how come their computers and servers didn’t pick up on that little detail when it was going over in the first pace when it could have been dealt with at the time and not another month later?

  2. […] if they had used their cards to pay for marriage counseling or tire repair services. A major cable TV company developed procedures to discourage prospective customers with low credit scores from signing up, […]

  3. […] if they had used their cards to pay for marriage counseling or tire repair services. A major cable TV company developed procedures to discourage prospective customers with low credit scores from signing up, […]

  4. […] if they had used their cards to pay for marriage counseling or tire repair services. A major cable TV company developed procedures to discourage prospective customers with low credit scores from signing up, […]

  5. […] if they had used their cards to pay for marriage counseling or tire repair services. A major cable TV company developed procedures to discourage prospective customers with low credit scores from signing up, […]

  6. […] if they had used their cards to pay for marriage counseling or tire repair services. A major cable TV company developed procedures to discourage prospective customers with low credit scores from signing up, […]

  7. […] if they had used their cards to pay for marriage counseling or tire repair services. A major cable TV company developed procedures to discourage prospective customers with low credit scores from signing up, […]

  8. […] they had used their cards to pay for marriage counseling or tire repair services. A major cable TV company developed procedures to discourage prospective customers with low credit scores from signing […]







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