A very frustrated employee of Frontier Communications working in one of their Ohio offices sent Stop the Cap! a detailed report on some of Frontier’s problems with customer service, unfair fees, and other horror stories. In this second part, a look at Frontier’s fees, service commitments, and the caliber of customer service. (Stop the Cap’s comments appear in italics.)

Installation fees can be a significant component of a customer’s first bill — a rude surprise for anyone choosing a promotional offer and experiencing bill shock when that first bill arrives. That triggers complaint calls to customer service, where a Frontier representative will ultimately decide whether you will get the free installation you were promised.

How much will your first bill be? The broken promises of “free installation.”

If you order today, your installation will be free… or not.

Let me share a little secret. I believe most representatives will always quote free installation to get the sale. Most believe the payoff for the company in the long run is better than the temporary hit we take on installation expenses. It also makes our commission checks a little fatter the following month. Unfortunately, in the rush to make the sale, I believe the majority of reps fail to note what they promised on the customer’s new account, which means they get charged some expensive install fees. Many quickly call in,  accusing us of reneging on our offer.

We handle these as if we were playing some version of Russian Roulette, straight out of Deer Hunter. One out of every six customers will not get their installation fees waived simply because we refuse. Sometimes it becomes a game of using your gut and flipping a coin. Other times it is the amount of the refund.

It is much easier on us if the fees we reverse are under $100, because we have the authority to issue an immediate credit. If the fees are over $100, things get complicated because the request must be approved by a regional office manager who relies entirely on the notes left by the customer service representative. If the request is denied, it is our job to call you back with the bad news. But the good news is the odds are still in your favor if you persist asking for the fees to be reversed.

I hate to say it, but it all comes down to the mood of the rep you get on the line and how much he or she is willing to fill out those forms for you. It sucks, but there is no full-proof system to prevent this and it frustrates me to no end.

Stayed home all day waiting for a Frontier technician who never showed up? They marked your problem solved anyway. 

Waiting for the service technician that claims he rang your doorbell and nobody answered.

This is truly the one that bugs me the most. I deal with at least 15 calls a day (this number has increased since July) where either the technician does not call a customer to notify them they can’t make it, or simply does not show at all and writes off the service order as “completed.”

The latter irritates customers and our call center to no end. Customers are infuriated when we tell them the technician knocked on your door, nobody answered, so they left you a note. Of course, the customer insists nobody ever actually showed up and they don’t have any note. We tend to believe the customers when they tell us they do not have working service, if only because they are calling us on their cell phones.

Customer service representatives can be audited and disciplined by Frontier for not clearly including a phone number where the customer can be reached, all for the benefit of Frontier technicians. Despite this, we find our techs rarely contact the customer to keep them informed about the progress of their service call.

Our worst problems are currently in Michigan and Indiana where the majority of our missed commitments stem from. No call, no show — a technician can do this to a customer and still have his job the next day. I would get a pink-slip marked “customer mistreat” and shown the door if I pulled this trick. But many technicians just don’t care and do not have to take the angry calls from customers wondering where the hell the technician is. We see it in tech notes left on the account that say things like ‘didn’t make it to the job on time – leaving to go home.’  They never bothered to ask the customer to reschedule or call them to let them know they won’t be coming.

I understand that their job is just as stressful as ours, but they need to pull their weight as well and stop marking incomplete orders as “finished” or avoiding the customer on a missed commitment. It infuriates customers and makes the company look bad.

The Race to the Bottom: Lower wages = inferior customer service

Over the past few years, Frontier has been consolidating its call centers — moving to locations where average wages and benefits are notoriously low and politicians push a “pro-business” agenda that hands out favors in the form of tax credits and incentives to companies willing to relocate.  For Frontier, this spells doom for employees that were paid enough to earn a living in places like Coeur d’Alene, Idaho ($15-21/hr) in favor of cheap labor staffing new call centers in states like South Carolina ($11-12/hr with a five year wage freeze). That is bitter news for former Frontier employees in Idaho who saved the company an estimated $84 million successfully converting an inherited Verizon computer system to the one Frontier uses in other states. Employees were thanked with termination notices and a cheap, plastic travel mug with the company’s logo. Paying a good wage or cutting paychecks to the least amount possible may make all the difference between a good customer service experience or an embarrassment for the company.

I am going to name a call center that every other Frontier call center loathes: DeLand, Florida.

This is one of our main sources of broken promises, bad orders and misinformation. In DeLand, you are considered a lifer if you’ve worked there for more than two years. They pay near-minimum wage to fresh-out-of-high-school students to sit on the phones, most of them quitting before their six month probationary period ends. Working for Frontier customer service is a summer job to the kids down there. They could care less if they write an order for someone in an area we don’t even service, provide customers inaccurate pricing, or just cold-transfer the customer back into the call queue if they are too ignorant to help the customer out.

Thankfully, not everyone in DeLand is doing a bad job. Some of our DeLand supervisors and representatives are earnest about delivering good customer service. But too often that is the exception, not the rule. DeLand is notorious for “cherrypicking” customers. That is a term Frontier call center workers know all too well. It means picking incoming calls that are most likely to generate commission-rich sales for the employee while throwing other callers back on hold for someone else to deal with.

The drive to make the sale is so intense, representatives sometimes start writing the order before they even verify the customer is actually in a Frontier service area. We use a simple verification system called CERT to check whether a potential customer is served by us or another phone company. But the orders for customers actually served by AT&T, Windstream, Verizon or CenturyLink still show up, and the customer has to be told later. We have heard about 60 percent of the orders placed in DeLand do not actually go through, either because of this problem or customers calling back changing their mind after they discover they were mislead about something.

Management does not seem to mind the aggressive sales tactics, because it brings the opportunity for new revenue, but customers left waiting or given bad information might.

Tomorrow: Frontier’s broadband service speeds, fees and some new facts about Frontier FiOS you shouldn’t miss.

A 52-year old Los Angeles woman was bill shocked when she found Time Warner Cable charged her for 17 pay-per-view adult movies ordered over four days, often within minutes of each other.

Total charge: $154.65.

The actual number of adult movies watched, according to Time Warner customer Carol Scott: Zero.

Time Warner Cable’s initial response to Scott’s billing complaint: “We don’t make mistakes. You must have watched all those movies.”

The Los Angeles Times‘ David Lazarus reported on the plight of the healthcare lawyer the cable company thinks can’t put down her remote control:

On one day, the bill shows, a dirty movie was ordered at 9:55 a.m., followed by additional orders at 9:57, 10:03, 10:04, 10:05 and 10:06. Each movie came with a $7.98 charge.

Two days later, according to the bill, Scott’s craving for porn returned in a big way with orders for adult movies at 10:39 a.m. and 10:40, and again at 2 p.m., 2:01, 2:03 and 2:04.

She was apparently in such a randy mood, the bill shows that two adult movies were simultaneously ordered twice that day at 2:03 p.m. and 2:04.

The next day, a little more afternoon delight was seemingly in order. Scott’s bill indicates that two more adult movies were ordered, at 12:15 p.m. and immediately after at 12:16.

Unfortunately, Time Warner’s bill doesn’t specify the titles of the various films, so we can only guess at the range of tastes on display.

Scott explained she never ordered an adult pay per view movie in her life, much less 17 of them — a fact Time Warner Cable could have taken into account had it appropriately investigated her pay per view order history.

Instead, the representative insisted he had proof the movies were directly streamed to her television (was he outside her window?). If she wasn’t the one watching, someone else was — or several people, considering Scott’s bill showed she had as many as six sleazy sex flicks running at the same time.

Scott’s request to block adult pay per view titles from being ordered ever again was blocked by Time Warner. A customer service agent explained it was all or nothing — block all pay per view titles or none of them.

When the Los Angeles Times reporter called Time Warner Cable on behalf of Scott, the cable operator got nervous and had premature explanations.

Scott said one representative suggested electrical shorts could have resulted in her pay per view porn escapade, or perhaps someone got inside her cable box. Another repeated the company’s earlier insistence she must have watched the movies.

Jim Gordon, a company spokesman, didn’t really want to talk about it.

“We take customer privacy seriously, which we know our customers appreciate, and as such we are not able to comment on a particular customer’s account,” Gordon said.

Gordon passed the newspaper reporter to Motorola to discuss cable box hacking, as the Time Warner Cable set top box involved was manufactured by them.

In the meantime, under threat of going public with a relationship gone bad, Scott’s account was credited $154.65 and the cable company found its way clear to configure a block on future adult pay per view titles on Scott’s account.

If you do not use your cable company’s pay per view service, why not consider avoiding being the next lucky victim of cable porn roulette and ask your provider to block all pay per view purchases.

Verizon is pulling back on its traditional landline service and FiOS expansion to continue focusing on its more-profitable wireless service.

Verizon Communications’ landline customers will endure continued cost cutting as the company focuses on its increasingly profitable wireless division, now set to bring in even more profits with Verizon Wireless’ transition to new, often higher-priced service plans.

Verizon executive vice-president and chief financial officer Fran Shammo yesterday told investors attending Bank of America-Merrill Lynch Media’s Communications & Entertainment Conference that the company is pleased with Verizon Wireless’ successful transition to Share Everything, which includes a shared data plan for multiple wireless devices.

Shammo characterized the true nature of Share Everything as a data plan that happens to include unlimited calling and messaging.

“It really comes down to data consumption and that is what drives revenue,” Shammo told investors. “And really the reason we did this was because we saw what happened in Asia with some of the text messaging and the dilution and voice migration.  So you are protecting that revenue stream going forward and we think that is beneficial to the consumer and the company.”

Shammo sees increased profits in Verizon’s future as customers transitioning away from unlimited data plans eventually bump up and over their new plan limits. But the revenue gains actually begin the moment customers sign up, as those bringing various wireless devices to a shared data plan are immediately told to upgrade for a larger data allowance at an additional cost.

“We are telling them that they really need 2GB per device,” Shammo said. “So if they want to bring five devices, they really should be buying the 10GB ($60/month) plan. What we are finding is customers are very receptive to that formula because they can get their head around the 2 gigabytes. They understand what their usage is. So part of it is that they are actually buying higher up packages than we’ve anticipated.”

Verizon also has a plan to deal with potential bill shock from customers using their wireless devices for high bandwidth applications. The company is receptive to letting content producers pay Verizon to cover customer usage charges.

Share Everything = a data plan that happens to include unlimited calling and messaging

“So when you look at that, revenue per account may not go up, but service revenue will because you are just getting it from someone else,” Shammo said. “So the LTE network allows the differentiation, and the way I like to classify it as you can have an 800 service over here, which is ‘free data’ because somebody else is paying for that and then you have your consumption data over here.”

Shammo believes customers who gave up their unlimited data plan believing Verizon’s basic data allowance will suffice for years to come will be surprised at how fast they will hit their limits as wireless data becomes more important.

“I think we are going to see this accretion faster than people think,” Shammo said. “If you look at our SpectrumCo [cable operators Cox, Comcast, Bright House Networks, and Time Warner Cable] deal, [CEO Lowell McAdam] and the team did an outstanding job convincing the Department of Justice about the innovation that can happen here and maybe being the first in the world to really integrate wireless with inside the home and content outside the home. And if you think about how that content can be streamed outside the home within cars, you really say this is unlimited as to where this can go. So I think the innovation is going to come very, very quickly here.”

With the spectrum deal with cable operators in place, Shammo said Verizon will not be in the market for any large spectrum acquisitions in the near future, and even plans to sell off some excess spectrum it does not currently need, so long as the company gets paid what it believes the spectrum is worth.

Verizon’s concern for keeping large amounts of cash on hand is evident as it continues to reduce investments in traditional landline service and FiOS. In fact, Verizon said it would continue increasing prices for its FiOS fiber network to more closely align with the higher prices cable companies are charging.

“We have really concentrated this year on getting our price points equivalent to where the rest of the market was,” Shammo said. “We were actually underpriced with a superior product to cable. So the concerted effort was we needed to do some price-ups and we are doing that over — we started in the first quarter. We did it in the second; we are doing it in the third. You saw some of that benefit come through in the second quarter where we delivered a 2.5% mass-market revenue increase, which was I think the best in years and I see that doubling by year-end. So I think that, coming out of this year, we will be on a very good path for a mass-market revenue increase.”

Two service calls in six months may get your traditional landline canceled and moved to Verizon FiOS phone service, which requires 10 digit dialing for every number.

But those rate increases will not deliver improved service. If fact, Shammo said Verizon will continue reducing costs and investments in its network. Much of its investment in the landline business has been to support Verizon Wireless’ growth through its IP backbone and fiber-to-cell-tower projects. Shammo predicts capital investments will continue to be flat to down.

One example where the cost-cutting is apparent is how Verizon deals with service calls for troubled phone lines.

Verizon landline customers in FiOS areas who report chronic service problems may find themselves disconnected and switched to FiOS Voice over IP phone service instead, because Verizon has quietly set new in-house rules about the number of permitted service calls for each customer.

“If we have a copper customer who is what we classify as a chronic (two truck rolls in a period of six months for that copper line), I am losing money on that copper customer,” Shammo said. “So if I can take that chronic customer and move them to FiOS, I deplete the amount of operational expense to keep that customer on and now I have moved them over to the FiOS network where they get the benefit of FiOS digital voice, which is clearer.”

Once a customer gets switched to FiOS, Verizon’s marketing machine swings into action.

“I now can put their DSL service onto FiOS Internet where they now realize the speeds of FiOS and what we are seeing preliminarily is even if we take a voice and DSL customer and move them, they are starting to buy up in bundles because they are starting to see the benefit of the higher speeds,” Shammo said. “Then we open up the sales routine to go after them, now for the FiOS TV product.”

Unlimited data holdouts can leave

Shammo added Verizon is becoming more concerned than ever about long term investments that leave the company waiting years for a return.

“Lowell and I have a very concerted effort to really make sure that the investments we make are returning their invested capital in a very short period of time,” said Shammo.

That spells trouble for landline service upgrades and future FiOS expansion, which both require the company to take a long term view recouping those investments. But even Verizon’s wireless business’ capital expenses are down — by $1.3 billion through the first half of this year.

Verizon Wireless has also picked up nearly $5 billion in cost savings through restructuring, including lucrative revenue earned from new activation and upgrade fees and also tightening up on subsidized wireless phone upgrades.

For customers holding onto unlimited data plans, intending to get their money’s worth from them, Shammo has a message:

“Quite honestly, they could leave my network because you are not making much money on those.”

Phillip “The Company Paid by Suddenlink to Issue a Third Party Guarantee Makes All the Difference” Dampier

When Stop the Cap! and Broadband Reports reader Simon contacted us about Suddenlink’s fact-free usage measurement tool that managed to rack up nearly 23GB of usage for one West Virginia customer on the same day his service was out for most of the evening, he probably did not think one customer catching the cable company’s fingers in the usage cookie jar would make much difference.

But it did.

Suddenlink spokesman Pete Abel, initially responding to complaints about the usage tool’s accuracy, told Light Reading last week its meter was “consistently accurate, as was demonstrated in the tests we ran before we launched this program.”

Four days later, the company effectively disavowed that, put the meter’s built-in overlimit fee scheme on hold and plans to hire a third party company to “validate the accuracy of its system,” after finding it was faulty after all.

Suddenlink won’t say what is causing the inaccuracies, but blamed “unusual” circumstances for the problem. The company is now refunding customers billed overlimit fees of $10 per 50GB and waiving future charges until its system is reviewed and validated by “a trusted third party.”

Stop the Cap! believes that does not come close to satisfying the company’s responsibility to its customers for accurate billing.

Suddenlink has never demonstrated it actually needs an Internet Overcharging scheme with usage limits and overlimit fees. The company proves that when it claims only a “relatively small number of customers” were ever billed overlimit fees. With no demonstrable usage problem, the company’s need to implement its Project Imagine “Allowance Plan” is sorely lacking.

Easy as counting anyway we like.

Additionally, the accuracy of providers’ usage measurement tools has proven highly suspect, and not just with Suddenlink. All of the companies caught with inaccurate meters always strongly defend them, until overwhelming evidence suggests they should not. Even super-sized companies like Bell Canada (BCE) and AT&T have enforced usage limits with meters the companies later had to disavow. Suddenlink is only the latest.

The scale in your grocery store is checked and certified. So is the corner gas pump, your electric meter, water meter, and gas meter. Why should broadband usage be any different?

Consumers are right to suspect Suddenlink’s usage meter. No official regulatory body verifies the accuracy of usage measurement tools and whatever company Suddenlink chooses to “verify” its meter has a built in conflict of interest — it works for a company that depends on a certain result in its favor. Suddenlink clearly has no business in the usage measurement business when it insists on the accuracy of a meter it disavows just a few days later.

With only murky details available to consumers about what caused the problem and why Suddenlink did not see it until a customer managed to catch them in the act, there is little confidence the company will actually solve a problem it never realized it had. There is also nothing to assure us — “third party guarantee” or not — it cannot happen all over again.

Suddenlink customers need to reach out and tell Suddenlink its “Allowance Plan” is completely unacceptable. Tell the cable company you don’t want to worry about their unverifiable and proven-inaccurate metering program. Ask them why you should remain a customer when they spend time and money on a scheme that the company itself admits is not really needed — targeting just a small number of “heavy users.”

Suddenlink’s customer service team does not think much of customers who use their broadband service a lot, as this recent “Who’s On First” exchange illustrates:

Lisa (Suddenlink): “Well, you show heavy OVERUSAGE of the Internet, you drew 14GB of data yesterday.”

Customer: “Okay, let’s back up, explain to me how I drew 12GB of data when my power was off and I wasn’t home on June 30.”

Lisa: “I didn’t say anything about June 30.”

Customer:  “If you have sooo much faith in your meter, explain to me how I drew 12GBs of data on June 30, while I didn’t have power, and wasn’t home.”

Lisa:  “I didn’t say anything about June 30.”

Customer:  “I’m asking, how did I draw 12GB of data without power to my house?”

If Suddenlink has a problem with a handful of users creating problems for other subscribers on its broadband network, it has always reserved the right to contact those customers directly and work out the problem one on one. That is a far better solution than inconveniencing all of their customers with endless rounds of “usage roulette,” where the big winner could find themselves with Bill Shock from overlimit fees, whether they actually deserve them or not.

[flv]http://www.phillipdampier.com/video/CNBC Internet v. Cable 8-20-10.flv[/flv]

CNBC interviewed Suddenlink CEO Jerry Kent in August 2010 on how his company intends to deal with “invasive online video,” threatening to erode cable-TV profits. Kent proved Suddenlink doesn’t really need any extra money from overlimit fees — the days of big spending on capacity are over, but the money is nice to have anyway.  (8 minutes)

Outside of a handful of consumer groups, just about everyone — including one “anti-tax” Republican on the Federal Communications Commission — favors the imposition of a new broadband tax on your Internet connection.

It is all a part of the Federal Communications Commission’s effort to transform a badly-outdated Universal Service Fund (USF) into the Connect America Fund (CAF) — an ongoing project to help defray the costs of wiring rural America for broadband service.

Phone and cable companies are on board. So are several state regulators. Even search engine giant Google favors applying a surcharge to consumer bills to retire a funding formula currently dependent on declining landline phone revenue.

In April, the FCC began accepting comments on its proposal to expand the number of telecommunications services subject to the surcharge, currently found on telephone bills. The FCC has proposed a number of possible taxes including the new broadband fee, a tax on text messages, or moving to a flat fee for each phone line instead of a variable tax rate (currently around 18%).

Virtually every major telecommunications company provisionally supports the new tax, for at least three reasons:

1. Most can benefit from future CAF funding opportunities, dipping into the fund to help subsidize expanding broadband into areas where current “return on private investment”-standards make deployment unprofitable;
2. Consumers will pay the tax, not providers;
3. The companies are confident their fierce lobbying will get the FCC to drop a proposed requirement the fee be included in the advertised price of broadband service. They want the fee broken out separately on customer bills, in part because they fear higher-advertised-prices for broadband will discourage customers from buying.

Google also supports the new tax because they profit from a larger broadband audience accessing their web pages and services. If the FCC were to tax online services, as Google fears, it would be bad news.

“Saddling these offerings with new, direct USF contribution obligations is likely to restrict innovative options for all communications consumers and cause immediate and lasting harm to the users, pioneers, and innovators of Internet-based services,” Google argued.

The Fiber to the Home Council, another industry group, was disturbed by one FCC proposal that would levy an increasingly higher percentage of the new tax on customers with progressively faster high speed connections. Although the Council agreed with many consumer groups that any new broadband tax would discourage broadband adoption, it was alarmed with the proposition of taxing consumers the most for selecting the highest speed broadband tiers.

“The Commission should not impose a fee that increases with greater performance capabilities (capacity/speed) because that would discourage plant and service upgrades and hinder the expansion of critically important high-speed broadband services,” the Council wrote in its comments to the FCC.

The Fiber to the Home Council is concerned about one proposal that would levy increasingly higher taxes the higher your connection speed.

With 19 million Americans currently unable to obtain broadband service, adding a new tax on existing broadband customers’ bills would bring in millions that the CAF will ultimately award to rural landline providers and cable operators to encourage them to expand their broadband networks.

But consumer groups including Free Press worry the new tax would rob Peter to pay Paul, and further discourage poor Americans who can’t afford current broadband prices from ever signing up for service.

“In other words, as the Commission reforms the overall USF system in the name of greater broadband adoption, particularly among rural, poor and elderly consumers, assessing [a broadband tax] could lead to an overall lower level of broadband adoption, despite the availability of new broadband subsidies,” writes Free Press research director S. Derek Turner in an official filing with the FCC.

Free Press called the current comments from industry players largely as expected.

“Industry commenters simply offered self-serving proposals that will ensure that their (but not necessarily their customers’) contribution burdens are as low as possible,” Turner wrote. “We instead are strongly encouraging the Commission to conduct actual cost-benefit analysis prior to adopting rule changes that could have massive unintended consequences for consumers.”

Thinks a broadband tax will reduce broadband adoption.

Outside of a small handful of remarks from end users, the overwhelming majority of comments received by the FCC are from providers, industry groups, and telecommunications regulators. Almost none come from actual consumers, who will ultimately pay the proposed tax.

Some conservative anti-tax groups have been alarmed by the tax expansion and Republican FCC Commissioner Robert McDowell’s apparent support of it. McDowell issued a statement in April declaring his support for reform of the USF system to broaden the tax to additional telecommunications users:

[…] “To put the importance of contribution reform into perspective, the contribution factor, a type of tax paid by telephone consumers, has risen each year from approximately 5.5 percent in 1998 to almost 18 percent in the first quarter of this year. This trend is unacceptable because it is unsustainable. Furthermore, the cryptic language on consumers’ phone bills, combined with the skyrocketing “tax” rate, has produced a new form of “bill shock.” We must tame this wild automatic tax increase as soon as possible.

[…] “Controversy, however, should not deter us from lowering the tax rate while broadening the base according to the authority granted to us by Congress. The current pool of contributors is shrinking. It must be expanded, but we must do so only within our statutory authority while keeping in mind the international implications of our actions.”