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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.
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… Read more »
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… Read more »
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… Read more »
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… Read more »