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Mediacom Complaints Pile Up: “I Talk to Mediacom More Than I Talk to My Wife”

Phillip Dampier March 8, 2010 Competition, Mediacom, Public Policy & Gov't 9 Comments

Mediacom is the nation's eighth largest cable company, serving 1.3 million customers in 22 states

Customers across the country are growing increasingly annoyed with Mediacom, the nation’s eighth largest cable operator that scored rock bottom in this year’s Consumer Reports cable survey.

The complaints keep on piling up: unfulfilled service calls, uninformed customer service agents in the Philippines, poor quality service, and in one case, a supervisor more concerned about how a customer obtained her direct number than actually resolving the customer’s problems.

The fallout from irritated customers now extends beyond horror stories from some of the company’s 1.3 million customers in 22 states — it’s now costing the company rejection of extended franchise renewal agreements in some communities, and plenty of bad press.

Boone County, Illinois

Boone County, Illinois

Last spring, Boone County began discussions about renewing a cable franchise Mediacom had with the county for some 20 years.  Public meetings to discuss the renewal brought throngs of customers annoyed with Mediacom’s poor performance.

The Rockford Register-Star took up the story:

Candlewick Lake resident Roger McGee Sr. has been experiencing difficulties with his cable company since he moved to the gated community two years ago.

McGee, a former Huntley resident, said he’s spent more time trying to get resolutions to his cable and Internet issues than he ever imagined was possible. “Every single step of the way the customer service was horrible and mismanaged,” he said Wednesday. “I talked to Mediacom more than I talked to my wife in those three months.”

Mediacom representatives characterized the complaints as mere aberrations and suggested isolated complaints could be resolved without impacting the company’s franchise renewal.  But additional public meetings held later that summer illustrated Mediacom had problems in the north-central Illinois region where it provided service.  The Register-Star reported:

George Chorvat has experienced countless issues with Mediacom Communications, and he’s looking for relief. The Poplar Grove resident isn’t alone.

Chorvat attended the county’s second cable hearing Tuesday at the Belvidere Township Building along with roughly 20 residents to speak out about service woes and to provide input on the county’s nonexclusive franchise renewal, which is in the negotiation phase.

“You took away half of our movie channels and said it was OK because we had On Demand, but we do not and we’re paying the same price,” Chorvat said.

His challenge of the offerings provided by Mediacom was one of several problems residents said they face.

Some residents detailed months of waiting for maintenance cable wires to be buried underground. Others told of weeks without phone service or waiting at home for technicians to arrive for scheduled appointments only to find the cable company had canceled them.

Late last month, Boone County granted the cable company a one-year extension of its cable franchise, citing customer complaints as the primary reason for the short-term extension.  In addition, the county will hold a series of public meetings at three, six, and nine month intervals over the coming year to check on customer service concerns and how Mediacom responds to them before considering a five year franchise extension.

The interim extension also keeps Mediacom from using telecom-friendly legislation to obtain a franchise from the Illinois state government, bypassing local officials.  Statewide franchising in Illinois was the brainchild of AT&T, which wants to expand U-verse without having to answer to local communities.  Mediacom has the ability to hop on board the same provisions to avoid local control if local governments refuse to extend a franchise agreement.

“We need to make sure we keep some county control here,” board member Karl Johnson told the newspaper in February. “No matter how big we think we are here, they’re a whole lot bigger when they come through downstate.”

Johnson heard several complaints from Mediacom customers about missed appointments, incomplete wire maintenance, and some who went weeks without Mediacom phone or broadband service.

Springfield, Missouri

Springfield, Missouri

Cable customers who experience problems expect answers when calling customer service, but Springfield resident Nancy Walker found herself empty-handed after speaking with a Mediacom representative thousands of miles away — in the Philippines.

“I am really upset,” Walker told the Springfield News-Leader in February. “I want a local number I can call, not the Philippines.”

She finally resorted to calling the office number of a friend who once worked for Mediacom before that friend passed away.  A supervisor was more concerned about how she obtained that number than helping her, Walker said.

Mediacom disconnected its local call center about three years ago, and company officials admitted they route calls to call centers, including one in the Philippines.  Larry Peterson, regional vice president of Mediacom, said the company dropped the ball on Ms. Walker, finding the customer service she received “unacceptable.”  Peterson handed Walker his business card and promised any issues would be resolved.

For customers who do not have Peterson’s personal office number, many just have to take their chances.

Springfield’s Cable TV Advisory Commission, which actually holds almost no real power over Mediacom, thought the company could do better.

Commission member Rita Silic urged the cable company to find a way to route dissatisfied customer calls back to a local Mediacom representative.

Dave Iseman, editorial page editor of the News-Leader, opined Mediacom needs “a full-fledged apologetic jingle. And it better be a long one, considering the waiting time that can be necessary to phone in a complaint.”

Burlington, Iowa

The fact Mediacom rated near the bottom in Consumer Reports‘ latest ranking of telecommunications companies — 24th among 27 Internet providers, 15th among 16 television service providers and dead last among 23 telephone providers — didn’t escape the attention of Burlington-based newspaper The Hawk Eye.  The newspaper noticed local complaints were continuing to pour in about service quality and trouble reaching customer service.

Columnist Don Henry even wrote about his own personal experiences with Mediacom in December:

Mediacom last month took away the religious programming my wife enjoys: I guess she shouldn’t complain.

They also poked out one of C-SPAN’s eyes on Congress. The Nancy Pelosi House of Horrors remains fit for family viewing, but not the Senate Shell Game. No explanation of why and I watched both — but I’m not complaining.

We were satisfied with “expanded basic” — but Mediacom decided to improve our viewing experience by removing four channels and making us rent some new box gadget to see them, plus a few we didn’t need.

Lest you complain, you get one box free … until they automatically raise your bill a year later. Conservatives think God trumps Harry Reid, so our box went into Sandy’s exercise room. She’s not complaining.

Henry’s problems only got worse from there, including e-mail disruptions and other service outages.  He did what most customers do when their service is on the fritz — he called the cable company.  That turned out to be quite an adventure:

“For e-mail problems, press 1; otherwise, stay on the line.”

I pressed 1.

“For e-mail problems, press 1; otherwise, stay on the line.”

Burlington, Iowa

I pressed 1.

“For e-mail problems, press 1; otherwise, stay on the line.”

After maybe 10 replays, I disobeyed. I stayed on the line … and waited … and waited … until my patience wore thin enough to drive to the Mediacom office on Division Street. I talked to a rep who seemed blissfully unaware of any e-mail problems. It’s been over a day and I’m far from alone, I said.

“Well, nobody’s told us.”

Could you ask about it?

“I can’t do that.”

Could you at least adjust my bill for the lost service?

“I don’t know of that ever being done.”

You used to, when I could get someone by phone.

“Then you’ll have to call.”

Henry’s column struck a nerve among local residents, who flooded the newspaper with comments about their own horror stories, ranging from pesky squirrels chewing through fiber optic cables to tsunamis of spam after the company “improved” its e-mail service.

Phyllis Peters, communications director for Mediacom, admitted the company could improve its customer service, but decided to devote most of her attention to taking issue with… Consumer Reports‘ survey.  Peters wants customers to know Mediacom isn’t dead last in the country because the magazine didn’t ask customers about every cable provider in the United States.  She’s certain there are worse examples out there:

Peters said one reason the survey might rate Mediacom so poorly is because of the company’s ambition. Mediacom is the nation’s eighth largest cable company, and focuses on providing cable coverage to non-metropolitan areas. Expanding service over a large area means more fiberoptic cable and servers that must be monitored.

Peters said the top-ranking cable company Wow, which had top scores on almost every attribute in the ratings, serves a much smaller, consolidated area than Mediacom. Wow is the 12th largest cable provider in the country, and services parts of Illinois, Michigan, Ohio and Indiana. Consumer Reports was enthusiastic about the company, but acknowledged its small size.

“We would like to be higher in the rankings. We’ve put a lot of effort into customer service, and we did add a lot of calling staff,” Peters said. “Those things have moved forward in a significant way, and it takes a while for perception to change.”

It may not always be easy to get a Mediacom representative on the phone, but the company offers the fastest Internet service in Burlington, she said. The company offers a standard download speed of 12 megabytes per second, and that service can be upgraded to 20 megabytes per second for a higher price.

Competition for Burlington residents’ broadband needs come mostly from Qwest, which offers most customers 1.2 Mbps DSL service, although the company can provide up to 7 Mbps in selected neighborhoods.

Max Phillips, president of the western Iowa division of Qwest, told The Hawk Eye he doesn’t know if the company will be able to provide higher speeds to Burlington in the near future.

“We have a long-term plan to bring higher speeds, but our business is constrained by the government model,” he said, whatever that is supposed to mean.

Carthage, Illinois

Carthage, Illinois

Mediacom has been out of luck securing a franchise renewal in Carthage because of ongoing customer complaints about the quality of service being provided to Hancock County residents.

Carthage has been without a Mediacom franchise agreement since the old one expired last June.

A proposed renewal was shot down by the city after a vote failed to approve it, citing reception complaints.  Mediacom has been asking the city for a franchise renewal ever since, but the city has resorted to four-month extensions, waiting to see what service improvements were forthcoming in the interim.

Mediacom installed new hardware in the community, which it felt would improve reception, and city officials were hopeful the noted drop in complaints reaching them was an indication of that.

But in February, complaints began arriving at the city’s doorstep once again.

Carthage Mayor Jim Nightingale said he heard two complaints right after the city council offered the latest extension.

Now he’s withdrawn the offer.

Mediacom can always appeal to the state of Illinois to seek a new franchise under statewide franchise laws, but discussions with city officials are continuing for now.

Prior Lake, Minnesota

Prior Lake, Minnesota

Communities looking for competitive alternatives to Mediacom usually find phone companies who refuse to offer video service in Mediacom service areas, because the cable company typically chooses smaller communities where such “telco-TV” projects don’t meet the minimum Return On Investment requirements necessary to build them.  Some communities served by independent phone companies or are lucky enough to find a willing fiber-to-the-home provider are in better shape, unless the cable company files suit to stop such projects from moving forward.

The community of Prior Lake, twenty miles outside of Minneapolis, and its 16,000 residents are a case in point.

Last fall, Mediacom filed suit against Integra Telecom, a Portland, Oregon-based provider of competitive voice, broadband, and television service that won a franchise agreement to provide “telco-TV” in Prior Lake and nearby communities within its existing service area.

The suit claims city officials discriminated against Mediacom by not compelling Integra to meet the same terms and conditions Mediacom agreed to in a 1999 franchise agreement. Specifically, Mediacom wants Integra held to the same requirement it agreed to in defining its service area.  Because Integra is not planning on matching Mediacom’s service area house by house, Mediacom claims they are in violation of Minnesota law.

That suit is awaiting a hearing in the state Court of Appeals expected to begin this month.

The dispute between Mediacom and the city has led one state senator to write legislation clarifying the existing cable franchise laws in Minnesota.

Senator Scott Dibble (DFL-Minneapolis), has introduced Senate File 2535.  The bill would allow telephone companies to provide competitive service within their natural service areas, instead of being required to match incumbent cable operator coverage areas.  For example, a cable company might serve a broader area where multiple phone companies provide service.  Under current state law, competing phone companies could be required to wire every area where the incumbent cable company provides service, even inside other phone company’s service areas.  Senate File 2535 recognizes the current telephone company service area boundaries as acceptable enough to proceed with a video franchise agreement.

Integra's service area in the Minneapolis/St. Paul region, which is not identical to Mediacom's service area, is one point of contention between Mediacom and Prior Lake officials

Prior Lake City Manager Frank Boyles and Senator Claire Robling (R-Jordan), both testified in favor of the bill at a recent hearing held by the state Senate Committee on Energy, Utilities, Technology and Communications. The bill was approved unanimously and now moves to the State and Local Government Operations and Oversight Committee, of which Robling is a member.

The League of Minnesota Cities is also calling on its members and the public to support SF2535 which could speed competition across Minnesota.

Text of Senate Bill 2535:

A bill for an act relating to cable communications; clarifying requirements for the granting of additional cable franchises; amending Minnesota Statutes 2008, section 238.08, subdivision 1.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1. Minnesota Statutes 2008, section 238.08, subdivision 1, is amended to read:

Subdivision 1. Requirement; conditions.

(a) A municipality shall require a franchise or extension permit of any cable communications system providing service within the municipality.

(b) No municipality shall grant an additional franchise for cable service for an area included in an existing franchise on terms and conditions more favorable or less burdensome than those in the existing franchise pertaining to: (1) the area served; (2) public, educational, or governmental access requirements; or (3) franchise fees. The provisions of this paragraph shall not apply when the area in which the additional franchise is being sought is not actually being served by any existing cable communications system holding a franchise for the area. Nothing in this paragraph prevents a municipality from imposing additional terms and conditions on any additional franchises.

(c) An area for an additional cable franchise is not more favorable or less burdensome if the franchisee is a telephone company, as defined in section 237.01, subdivision 7, and the area of the franchise is no less than the area within the municipality in which the telephone company offers local exchange telephone service. This paragraph is in addition to and not a limit to the authority of a municipality to grant an additional franchise for cable service.

Virgin Mobile Broadband Increasing Usage Allowances, While Maintaining Existing Pricing; Cricket Could Be Next

Phillip Dampier March 4, 2010 Competition, Wireless Broadband Comments Off on Virgin Mobile Broadband Increasing Usage Allowances, While Maintaining Existing Pricing; Cricket Could Be Next

Virgin Mobile’s Broadband2Go prepaid mobile broadband service is increasing usage allowances in hopes of attracting new customers at current prices.

The service, launched last June, has not been as successful as it could be, especially in markets where competitors like Cricket offer no-commitment wireless broadband for $40 a month for up to 5GB of usage, for a lower initial cost.

Sprint, which now owns the Virgin Mobile brand, isn’t lowering prices, but it is increasing usage allowances.

Before:

$10 buys you 100MB of access that expires 10 days after activation.
$20 buys you 250MB of access that expires 30 days after activation.
$40 buys you 600MB of access that expires 30 days after activation.
$60 buys you 1GB of access that expires 30 days after activation.

Now:

The high end Virgin Mobile plan now matches many postpaid plans for pricing and usage allowance, without a two year contract.  But it’s still priced $20 higher per month than Cricket.  ConnectedPlanet notes:

According to Virgin Mobile chief marketing officer Neil Lindsay, more than 70% of Virgin’s customers said they signed up for Broadband2Go because of the flexibility to change the plans as they needed more or less bandwidth and to pay only for what they needed. Virgin is targeting those cord cutters, such as students or families, who may be using the Broadband2go as a replacement for their at-home Internet service. Virgin’s own surveys indicate that this at-home group already includes 16% of its Broadband2Go customers. Of its user base, 30% also use the card more than four times per week, and 47% asked for additional data on their existing plans.

In turn, Leap Wireless, which owns Cricket, is hinting it may be looking at its own pricing and usage allowances to maintain competitiveness.  No specifics yet, but Leap’s 4th quarter earning results were hardly impressive, reporting a wider loss than Wall Street analysts expected, as competition and a weak economy helped erode profits.  The company does not plan to expand into new cities in 2010, but will offer nationwide coverage for existing customers with expanded roaming agreements.  Also on the way — smartphones from Blackberry and at least one Android phone.

Google Broadband: Faster Internet May Reach Mid-Missouri

[Stop the Cap! will be closely following Google’s experimental gigabit fiber-optic broadband network.  We’ll be bringing regular updates about the communities applying, the strategies they are using to attract Google’s attention, what the competition thinks, and the impact of the project on American broadband.]

Columbia, Missouri is excited about the prospect of being chosen as a test city for Google gigabit broadband.

It’s just one of tens of communities seeking to apply for Google’s new experimental fiber to the home network delivering super fast broadband to residents and businesses.

Columbia is the fifth largest city in the state, with 100,000 residents who call the heart of mid-Missouri home.  Columbia is a classic college town, supporting the University of Missouri.  It’s uniquely known as one of the most-educated communities in the country, with over half of its residents holding college degrees.  Columbia residents are quick to embrace new technology, and this drive to adopt the latest and the greatest has fueled interest in Google’s fiber network.

Columbia’s Regional Economic Development, Inc. (REDI), promoting local business and economic development, has been coordinating what to do next.  They’ve been joined by ComoFiber, which is working to generate public interest in the project and help devise a strategy to win Google’s attention.

courtesy: me5000

Columbia, Missouri

Mike Brooks, from REDI, said the city has seen a great deal of interest from the community to apply for Google’s plan.

Last week, both groups met to educate the public and start identifying why Columbia poses an attractive place for Google’s project.

Some believe Columbia would be the ideal city to build such a network.  ComoFiber explains:

The reasons are numerous, but the biggest reason is really quite simple: Columbia is on the knife’s edge: the sweet spot between big, highly-developed cities and small, under-served towns.

The reason this is so important is because it’s easy to see why Google might want to deploy its fiber in either a big city or a small town, but it’s equally easy to see why they wouldn’t. The big cities have high-tech industry, universities, highly educated populae and other capabilities that allow them to produce the kind of applications and creative products that Google wants to research. On the other hand, major cities already have a great deal of fiber infrastructure, and their broadband prices are generally reasonable. So really, they’re already enabled; adding marginally-faster service to those markets won’t be the kind of sea-change that the plan is designed to study.

ComoFiber compiled a list of strengths from both the “big city” and “small town” perspective:

Columbia/Boone County, Missouri

Columbia as Big City:

  1. Multiple colleges and universities, including world-class research facilities.
  2. A major life sciences epicenter. Life-science is perhaps the most data-intensive industry in the world.
  3. A highly-educated, technically-skilled populace. Thirteenth-most educated in America, to be exact.
  4. Many high-tech small businesses, including Internet-centric outfits such as Newsy.
  5. Several major hospitals and health care businesses, including some at the forefront of technological advancement.
  6. Small-business incubators run in cooperation with universities and the city.
  7. The world’s foremost journalism school and the Donald W. Reynolds Journalism Institute, which houses a state-of-the-art Technology Testing Center.
  8. Several existing Internet service providers who can take advantage of this new open network.
  9. Excellent data backhaul capability due to our position on the I-70 corridor.
  10. With over 100,000 people, the population is high enough to meet Google’s goal for project scale.

Columbia as Small Town:

  1. Sub-par broadband performance with high prices.
  2. Very little existing fiber-to-the-home infrastructure.
  3. High tariffed rates for enterprise-class data products (T1, DS3, etc.)
  4. Midrange population density should be a good microcosm for suburbia nationwide.
  5. Smaller building development (no high-rises) makes infrastructure deployment simpler.
  6. ”The District” contains the kind of mom-and-pop small-town businesses that can innovate unencumbered by corporate imperatives.
  7. Frequently listed in “best places to live” compilations, such as that of Money Magazine.
  8. Location in the heart of middle America sends a powerful symbolic message.
  9. Low cost of living will be nice for the employees Google will need to move in.
  10. With only a bit over 100,000 people, the population is low enough not to dwarf Google’s goal for scale.

The incumbent cable operator, Mediacom, can’t understand why there is such excitement over Google’s fiber project.

“Google is going to be in select markets, and it’s kind of a test that they’re rolling out,” Mediacom director of operations Bryan Gann told KOMU-TV in Columbia. “It may be limited to some commercial applications in the beginning.”

Mediacom is Columbia's incumbent cable company

Mediacom doesn’t think most residents have any need for super fast broadband.

“I think when you get up to those higher speeds that fast, it’s a select group that would even be interested in it going at that speed,” Gann said.

Despite that remark, Gann quickly added Mediacom was already providing the fastest broadband access in town.  In early February, Mediacom boosted its top broadband speed to 50Mbps, and Gann says the company already has plans to boost that speed to 100Mbps in the future.

“We’re already supposed to go to 100, so we can press on the accelerator anytime we want to,” Gann said.

When a new fiber-based competitor threatens to arrive in town, most cable companies downplay the competitive threat.  Mediacom was no exception.

Gann told KOMU Mediacom was used to competition in broadband service and doesn’t see Google Fiber as a threat.

“With the technology that the cable industry put into Columbia, we’re ready to increase our speed to match competition,” Gann said.

[flv]http://www.phillipdampier.com/video/KOMU Columbia Faster Internet May Reach Mid-Missouri 2-16-10.flv[/flv]
KOMU-TV talks about Columbia’s prospects as a chosen city for Google’s new fiber-to-the-home experiment. (2/16/10 – 1 minute)

Telecom Sock Puppets: Digital Policy Institute Argues Broadband Speed Less Important Than Jobs

Americans have got it all wrong.  Their ‘faster is better’ obsession over broadband speed threatens to harm jobs and hurts those looking for work.

Those are the views of Stuart N. Brotman, a senior fellow at the Digital Policy Institute, which calls itself “a vehicle for faculty research that coalesces around the arenas of law, regulation, economics, intellectual property, and technology as these relate to public policy issues of local, state and national interests.”

Brotman argues that while broadband speeds matter, regulators should not be focused on speed as much as considering how broadband can help Americans find jobs.

The Agriculture and Commerce Depts. are tasked with administering $7.2 billion in stimulus funding for broadband by Sept. 30. As they decide where to place the bulk of those funds, which remain unawarded, government officials should show preference to grant and loan applicants that can use broadband to reach displaced workers more quickly.

There also need to be more funds made available to, and a greater focus on, public institutions, such as libraries, community centers, job training facilities, and adult education sites, where broadband spending may have the largest impact on jobs.

Greater broadband competition, which the FCC recognizes is essential to promote more infrastructure development and more varied pricing, also will be helpful. So, too, will be more efficient use of our spectrum resources, particularly those that have been controlled by colleges, schools, and other educational institutions for decades. Those airwaves can be better deployed to deliver high-speed wireless broadband services or leased to private-sector companies offering them.

Large telecommunications providers couldn’t have said it any better.  They have repeatedly argued broadband speeds are besides the point.

Brotman

AT&T last fall wrote the Federal Communications Commission, suggesting residential customers would do fine with broadband speeds that let them “exchange emails, participate in instant messaging, and engage in basic web-browsing.”  For AT&T, speed was less important than setting “a baseline definition of the capabilities needed to support the applications and services Americans must access to participate in the Internet economy—to learn, train for jobs, and work online….”

Verizon echoed AT&T, asking the Commission to retain the current minimum definition of broadband speed at 768kbps downstream and 200kbps upstream.  That allows them the chance to participate in stimulus funding projects that set the broadband speed bar low, especially in the rural areas Verizon wants to spend less on or is trying to sell-off.

“It would be disruptive and introduce confusion if the Commission were to now create a new and different definition,” Verizon said in its letter to the FCC.

Some of the smaller telecommunications companies also believe broadband speed should be de-emphasized.

Embarq, before completing a merger with CenturyTel (now CenturyLink) told the FCC 1.5Mbps broadband service has become “the most common offering.”  Embarq called that “consistent with an emphasis on economic development and jobs as many important applications, such as video conferencing are arguably possible only with 1.5 Mbps service and above. Any higher speed threshold, however, would risk defining as unserved the large number of satisfied customers of 1.5 Mbps service, which seems implausible.”

Embarq underlines the real reason providers are concerned about broadband speed — they’re not delivering it.  Once legislators or the Commission increases minimum broadband speed levels, many of these companies may find themselves below the threshold, guilty of “just enough speed to scrape by” in non-competitive markets.  That could lead to the prospect of facing federally-funded stimulus projects from others in their service areas, now deemed “unserved” or “underserved.”

Brotman further advocates that funding be focused on those that can deliver results “quickly.”

Embarq would agree with him there as well, stating “funds through grants directly to broadband providers rather than loans or other measures as this will have the greatest and quickest impact in bringing broadband to the hardest-to-serve areas.  …there is no time to wait for complete broadband maps or block grants to states for redistribution.”

Telecommunications companies would also do well by Brotman’s suggestion that federal funding for broadband projects reaching public and community service institutions should be emphasized.  As communities often request companies provide those services at a deep discount or free in return for franchise agreements or other licensing provisions, that’s money AT&T, Verizon, and others need not spend out of their own pockets.  Getting free airwaves swiped from educational institutions to deliver wireless broadband also benefits AT&T and Verizon, who are in that business as well.

When a “policy institute,” “research group,” or other seemingly unaffiliated entity starts rehashing telecommunications industry talking points, it’s time to start digging.

Buried on page five of a PDF file describing the work of the Digital Policy Institute, one comes to a section titled, “DPI Impact and Influence.”  DPI doesn’t list their financial supporters or partnerships as such.  Instead, they call them “national, collaborative relationships.”  Who does DPI collaborate with?

  • AT&T
  • Embarq
  • National Telecommunications Cooperative Association (rural telco lobbyists)
  • Verizon
  • …among others.

Imagine my surprise.

But that’s not all.  Stuart N. Brotman Communications counts (or counted) among his clients AT&T, Cox Cable, National Cable and Telecommunication Association, and the New England Cable TV Association.

Perhaps Business Week would have done a better service to readers had they also disclosed that.

Time Warner Cable – Trying to Keep Customers From Leaving After Substantial Rate Hikes

Phillip Dampier February 15, 2010 Competition 10 Comments

Some communities are luckier than others.  When your cable company boosts rates, some consumers have another provider available, letting them take their business elsewhere.  That’s especially true if there is another provider in town that doesn’t require you to attach a satellite dish to your roof.

For those who have no other alternative, it’s time for the family meeting to discuss what action, if any, will be taken to deal with a bill that relentlessly increases year after year.  The solutions usually come down to “grin and bear it” when paying the higher price, start dropping channels, or go cold turkey and get rid of cable altogether.

In economically troubled western New York, just accepting a higher bill isn’t always an option.  For residents of Buffalo, many have the choice of switching from Time Warner Cable to Verizon FiOS.  Many Queen City residents have threatened to do just that, often extracting concessions from Time Warner Cable when they call to cancel.

Stop the Cap! reader Marion, who lives in Amherst, wrote she was outraged to receive word of yet another rate hike from Time Warner Cable.

“Our family had been pestered by Verizon ever since FiOS came around our area, but having the phone company tear up your house to rewire everything and change your e-mail address was a real hassle, so we just kept Time Warner,” she writes.  “I’m fed up paying for all these filthy channels I never watch and I frankly can’t afford to keep paying them more and more every year whenever they have one of their programmer disputes.”

Marion called to cancel service and was transferred to a “retention specialist” who is trained to rescue departing customers before they cut the cord or show up at the cable office with their set top boxes in hand, waiting to turn them in.

“They always want to argue what a great value they are and how messy and time-consuming FiOS is to install, and you have to pay extra for HD channels I’m too old to appreciate anyway, but I just kept saying ‘cancel’ and said the only thing I cared about was the price,” Marion adds. “In the end they offered to cut the bill twenty dollars a month and give me a discount only new customers would get if I agreed to stay with a term plan.  I decided I would, for now.  I’m on a fixed income and with no Social Security increase this year, the price is very important to me.”

Alan Pergament is the TV Critic for the Buffalo News

Time Warner Cable is well aware when customers leave.  The company’s “churn” rate, measuring departing customers, has been on the increase in highly competitive service areas.  Consumers have learned to use new customer promotional offers from the competition against their current provider, threatening to cancel if they refuse to match them.  The costs of getting those customers back can be higher than just handing over a temporary discount, so many providers relent and give customers the lower price they want.

In Buffalo, convincing customers the local cable company is a better value and offers better service than the fiber-based FiOS competition might keep customers from thinking about switching in the first place.  That’s the idea, anyway.

The Buffalo News Tuesday published an interview with Time Warner’s Jeff Unaitis on the recently-announced rate hike and what changes the company is making to try and hold onto their customers.

Unaitis started with a range of new and upcoming improvements the cable operator is planning to make across upstate New York:

• The 24-hour news channel YNN —or Your News Now—will be the title of all TWC news channels across the state shortly to give it a “seamless news presence across the state.”

“You are beginning to see more shared coverage across the state,” said Unaitis.

Additionally, viewers in Western New York will get an upconverted HD version of YNN on Channel 709 by April or so. In other words, it isn’t shot in HD but it is HD quality. It already has been done on TWC’s news channel in Syracuse. “The reality is when you are accustomed to see HD content going back to something that is standard digital, let alone analog, is more difficult viewing,” Unaitis said.

• A new interactive, user-friendly, online programming guide will be available soon. One bonus: It will be easier to order On Demand titles.

In the next few months, the satellite feature celebrated in the ads with “Pysch” star Dule Hill that allows subscribers to program their DVRs remotely while they are away from home will soon be available to TWC subscribers with this guide.

• TWC is looking at the possibility of expanding “significantly more” HD channels that the public has requested. BBCAmerica, Lifetime and all the Viacom channels (VH1, MTV, Comedy Central and Nickelodeon among them) are among the most requested. “Some of them are contingent on carriage deals,” said Unaitis. “Others we do have the rights to carry, we just haven’t done the engineering required to have them yet.”

• The popular Start Over feature — which is up to 90 channels here and allows viewers to start shows from the beginning during the time window it airs — will be augmented some time this year by a new “Look Back” feature. “Look Back” enables viewers to watch shows for up to 72 hours after they air rather than just the window in which they air.

Unaitis added that viewers may not realize that the Free on HD Demand channel offers subscribers many of the same programs that are available on Prime Time On Demand, but in HD.

YNN provides 24/7 local news coverage on individual channels in Buffalo, Rochester, Syracuse, and Albany

The newspaper’s TV critic, Alan Pergament, noted the service changes, but immediately pelted Unaitis with the concerns local residents actually have about their Time Warner Cable service.  To save time, and because of complaints I’ve had about my verbosity, I’ve boiled it all down for you:

Q. Why isn’t Time Warner Sports-Net, the local sports channel, in HD?

A. Because it costs too much, but Unaitis claimed the channel will be upconverted to HD, which will “give it an HD-quality signal.”  Not really.

Q. Buffalo gets Canadian networks from Toronto-area stations on their lineup.  Why aren’t they available in HD?

A. Who knows.

Q. Why can’t people pay for only the channels they want?

A. Because programmers won’t allow it, and the cable company would end up charging you the same price you pay for 75 channels today that you’ll pay for 20 channels tomorrow. Plus, you’ll need a box on every TV in the house and that also increases your bill.

Q. How much do western New Yorker’s pay for YNN?

A. None of your business.

Q. How many subscribers does Time Warner Cable have in western New York?

A. None of your business.

Q. Why do those in western NY pay a higher price for cable service than elsewhere?

A. Unaitis didn’t know if that was true or not, but then explained it was because of the weather, labor costs, high state taxes and the difficulty building and maintaining the cable lines.

Okay, then.

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