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Spectrum Customer Service Reps Apologizing for Awful Pricing

…for our outrageous pricing!

Spectrum’s customer service agents are apologizing to customers for the rate shock they are experiencing when their existing Time Warner Cable or Bright House Networks promotions expire and customers find out the Spectrum plans and pricing being offered instead turn out to be nothing close to the deals customers used to get.

“You may get a call asking about my performance today, the survey is about me and my job today only,” a customer service agent explained to Jason, a Spectrum customer in Elmhurst, N.Y., who shared his experience on DSL Reports. “It doesn’t have anything to do with how you feel about Spectrum or TWC. If you are upset about the new pricing, please use the comments portion to explain. I look forward to hearing your feedback.”

Customer service representatives are on the front line of delivering bad news to cable customers facing double-digit rate increases, especially when customers realize they also receive fewer TV channels after changing plans.

“I’m guessing these agents must be getting destroyed in the surveys, [and] having worked retail where these types of surveys are used, I felt bad for the reps,” explained the Spectrum customer. “I know in my neighborhood, everyone seems to have their TWC promos expiring in the next month or so and are very unhappy.”

That unhappiness is getting worse as word about Charter Communications’ mid-year rate increase is showing up on customer bills. Broadband prices are increasing at least $1 a month, the Broadcast TV Surcharge is rising to $7.50 a month, and set-top box equipment rentals also increased by $1 a month for each piece of equipment starting in August 2017.

Premium speed broadband customers are now also facing a higher internet bill.

Spectrum’s Ultra tier, which is 100Mbps in some markets, 300Mbps in others, is increasing to $119.99 a month, up from $104.99 in most markets. The increase is less if you also subscribe to Spectrum TV, which reduces the rate to $113.99 a month. Spectrum rate cards from around the country do not yet reflect the $1 rate increase for traditional Spectrum 60/5Mbps internet (100Mbps in select markets):

Low income customers enrolled in Spectrum’s Everyday Low Price (ELP) internet package — a carryover from Time Warner Cable — also got the rude shock of a $5 rate increase on a service that used to cost $14.99 a month. That represents more than a 33% rate hike, which is just fine with Charter.

“In some of our markets the price has increased for the ELP package,” said spokesperson “Julie_R”. “Notifications were sent via bill statements and became effective with the August statements. Our ELP package is not a promotion.  From time to time, Spectrum makes decisions to adjust the pricing for our products and services to account for network investments.  We understand that value is important.  ELP is still a very good value at $19.99.”

The rate increase does not apply to New York State residents, where regulators placed significant deal conditions on the Charter/Time Warner Cable merger to help protect consumers in that state.

We have also been receiving reports from readers that Spectrum’s Internet Assist (SIA) program, designed for the elderly and income-challenged, is not easy to enroll in and customer service representatives have rejected a number of applicants for a variety of reasons. SIA offers a 30Mbps broadband connection for $14.99 a month to those qualified for:

  • The National School Lunch Program (NSLP); free or reduced cost lunch
  • The Community Eligibility Provision (CEP) of the NSLP
  • Supplemental Security Income (SSI) ( ≥ age 65 only) Programs that do not qualify for Spectrum Internet Assist: Social Security Disability (SSD), Social Security Disability Insurance (SSDI), and Social Security Retirement and Survivor Benefits are different from Supplemental Security Income (SSI) and do NOT meet eligibility requirements.

The biggest problems encountered so far:

  • Representatives lack information about the program and attempt to upsell customers to regular pricing and packages.
  • Bundling additional services with SIA can be more expensive than just choosing a traditional bundled package sold to everyone, especially if it is a new customer promotion.
  • There is considerable confusion over the qualifications for SSI recipients. Be sure to recognize you must be 65 or older and note SSD, SSDI, and certain other programs noted above do not qualify you to receive SIA.

We are continuing to monitor the SIA program looking to ensure Spectrum is making the program available to customers that qualify for it.

John Malone’s Virgin Media Teaches Brits About American-Style Rate Hikes

Phillip Dampier July 31, 2017 Consumer News, Virgin Media (UK) 2 Comments

British cable subscribers are getting a taste of American bill shock, courtesy of another dramatic rate hike from cable giant Virgin Media, now owned and operated by John Malone’s Liberty Broadband.

Virgin announced it will hike rates for a 13 TV channel and broadband package by $44.50 a month starting in August. Customers used to pay $8.92 a month for the package, or $51.89 for the year. Next month, they will pay $53.51 for the first month and $77.84 each month thereafter.

If you can afford the VIP Bundle, which includes 97 TV channels, you will also pay more next month. Virgin charges $137.84 a month today for the package. Next month, the same package will cost about $146 a month for the first year, increasing to $195 a month after that. Broad rate increases will also impact students on nine-month discount contracts, generally around $5 more a month.

Last August, Virgin jacked rates up quite a bit as well — $68.11 a year for those with a broadband and phone or “big bundle” package and just under $58 a year for those with broadband-only service.

“Nobody likes a price rise, and we understand this,” Virgin Media always writes on its website in response to rate increases. “That’s why we’re always looking to bring you the best Virgin Media experience.”

It seems Virgin is determined to get those in the United Kingdom experienced with American-style cable bills.

Wall Street Analyst on TV Network Fees: “Companies Are Not Supposed to Make That Kind of Money”

Phillip Dampier July 26, 2017 Competition, Consumer News, Online Video 1 Comment

A Wall Street media analyst called today’s television model of high returns and relentless rate increases passed on to pay television customers unsustainable.

Sanford Bernstein media analyst Todd Juenger told attendees of The Independent Show (courtesy: Multichannel News) in Indianapolis that media companies expecting to profit from linear TV’s increased advertising revenue and retransmission or carriage consent fees are going to get slapped in the face soon as consumers revolt.

Juenger, like BTIG’s Rich Greenfield, is becoming increasingly pessimistic about today’s costly bundled-TV model. Juenger warns high revenue and profit expectations are only going to accelerate the growth of disruptive technologies like on-demand, online video.

Juenger notes cable and television networks never seem satisfied with the massive amounts of revenue they are already earning, and keep seeking ways to raise prices further. The TV business, Juenger notes, already enjoys some of the highest profit margins of any U.S. business in modern history.

“This is a very, very rare thing,” Juenger said. “Companies are not supposed to make that kind of money.”

Most cable networks now expect 40% annual revenue increases and a 30% return on capital, which is what causes runaway programming rate increases to be passed on year after year to consumers. Yet the quality of those networks has not significantly improved in many cases, and consumers are gradually shifting away from watching live television (and the commercials that accompany it).

Viewers, starting with younger generations, are increasingly ditching linear-live television and finding on-demand content to be more appealing. Much of that viewing isn’t taking place on the cable industry’s on-demand or TV Everywhere platform, which has become as littered with advertising as live television. Instead, viewers are drawn to original productions produced by Hulu, Netflix, Amazon, and other content platforms — often commercial-free, and on-demand network shows on platforms like Hulu.

“The whole reason for being for networks is called into question,” Juenger said.

Juenger dismisses the current industry trend of creating virtual online alternatives to cable television bundles — skinny or otherwise — for streaming online. Those efforts, like Sling TV, DirecTV Now, and PlayStation Vue still depend on linear television as their core product, and cord-cutters are showing a growing lack of interest in this model.

Cord-cutters and cord-nevers don’t want smaller, more economical bundles of cable networks delivered online, according to Juenger.

“I don’t think there is anybody who wants these products on an incremental basis,” Juenger said. “If the purpose of these services is to recapture subscribers that were lost, they’re not going to work.”

Viewers want an entirely new model, built around on-demand access to individual shows without viewing restrictions or having to pay for unwanted channels. Many are also willing to pay a little more to avoid commercials altogether.

Gouging Legacy Time Warner Cable Customers: Set-Top Boxes $11.75/month

Phillip Dampier July 25, 2017 Charter Spectrum, Consumer News 1 Comment

Charter Communications customers with Spectrum and Time Warner Cable packages in several parts of Ohio are being notified analog cable television is about to be switched off in favor of all digital, fully encrypted cable service starting in August, and that switch will cost some subscribers plenty.

More than two million customers across the state are getting robocalls from Charter warning all cable-connected television sets must have a digital receiver attached by the time the switch takes place or they will lose television service.

“They only mention digital receivers, which is what Spectrum calls their basic set-top box,” said Charles Pierson, a Charter customer in Columbus who is still hanging on to his old Time Warner Cable package. “The recording doesn’t promote alternatives like a CableCARD, Roku or a digital adapter, which can cost considerably less than what Charter charges its legacy Time Warner customers for cable equipment.”

Pierson notes that because he has not abandoned his Time Warner Cable package, he faces a huge rate increase if he puts digital receivers on his three spare television sets that do not have boxes attached to them.

“Charter really wants to gouge you off of your current plan and make you switch to a Spectrum plan, so they have told us that Time Warner Cable plan customers like us will pay $11.75 a month for each set-top box while Spectrum customers can qualify for free equipment for up to five years or, at worst, pay $4.99 a month. That means we have to pay more than double the price for exactly the same equipment.”

For many customers, “free” equipment will not be an option. Charter usually only provides that promotion to customers who have never had a set-top box before or are on a qualified public assistance program. Charter’s customer service representatives are trained to urge Time Warner Cable legacy plan customers to walk away from them, offering the fact Spectrum plans charge lower prices for cable equipment. If that does not work, legacy customers like Pierson are told the price for each box is nearly $12 a month if they insist on keeping their current TWC plan.

Although written communications about the digital conversion from Charter mention the availability of poorly understood CableCARD technology as an alternative, only a tiny percentage of customers choose this option. Charter’s own support pages don’t help with “clarifying” information like this:

CableCARD customers subscribing to any service package in which Spectrum equipment is included in the package price may receive a discounted price, reduced by an amount equal to/greater than the fee for such equipment not leased from us. We lease CableCARDs for $2.00 per month per CableCARD for use in customer-owned retail CableCARD-ready devices. Our leased receivers also include either a CableCARD or integrated security inside the device. Our lease rate for cable boxes with CableCARD includes a $2.00 imputed charge for the included CableCARD.

Considering the fact CableCARD technology used by Spectrum does not support on-demand features, the majority of customers follow Charter’s recommended upgrade path to digital receivers or cancel service when they learn how much their bill is going up. Many will wait up to two hours in long lines at cable stores to manage either.

Charter customers facing a forthcoming digital conversion can skip the line in many areas and order digital receivers online from Charter to be delivered by mail. Visit spectrum.com/digitalnow or call 844-278-3408 to verify if you qualify. Delivery takes 3 to 5 days, with no delivery charge.

Customers can also bypass Charter’s equipment by placing Roku devices on spare televisions. The majority of Charter’s television lineup can be found in the Spectrum TV app in the Roku channel/app store.

Wall Street Hissyfit: Raise Broadband Prices to $90/Month Immediately! (Or Else)

If the average customer isn’t paying $90 a month for broadband service, they are paying too little and that needs to stop.

That is the view of persistent rate hike advocate Jonathan Chaplin, a Wall Street analyst with New Street Research, who has advocated for sweeping broadband rate increases for years.

“We have argued that broadband is underpriced, given that pricing has barely increased over the past decade while broadband utility has exploded,” Chaplin wrote in a note to investors. “Our analysis suggested a ‘utility-adjusted’ ARPU target of ~$90. Comcast recently increased standalone broadband to $90 with a modem, paving the way for faster ARPU growth as the mix shifts in favor of broadband-only households. Charter will likely follow, once they are through the integration of Time Warner Cable.”

Companies that fail to raise prices risk being downgraded by analysts with views like these, which can have a direct impact on a stock’s share price and the executive compensation and bonus packages that are often tied to the company’s performance.

But there is a dilemma and disagreement between some cable industry analysts about how much companies can charge their customers. Companies like Cable ONE have been aggressively raising broadband prices to unprecedented levels in some of the poorest communities in the country, which worries fellow Wall Street analyst Craig Moffett from MoffettNathanson LLC.

“Never mind that the per capita income in Cable ONE’s footprint is the lowest (by far) of the companies we [Moffett’s firm] cover, or that the percentage of customers living below the poverty line is the highest (also by far),” Moffett told his investor subscribers. “What matters is that there is very little competition in Cable ONE’s footprint. If you want high-speed broadband, where else are you going to go? The unspoken fear among their larger peers is that over-reliance on broadband pricing invites regulatory intervention, not just for Cable ONE, but for everyone.”

Chaplin thinks the risk from gouging broadband customers is next to zero. With cable TV becoming less profitable every day, all the big profits that can be made will be made from broadband, where cable operators often enjoy a monopoly on high-speed service.

According to Chaplin, if customers value internet access, they will pay the higher prices cable companies charge. So what are companies waiting for? Raise those prices!

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