‘Disloyal Cablevision customers looking for discounts are dead to us.’

Cablevision is fed up with disloyal customers bouncing between the cable company and other providers when promotional discounts expire.

After losing 13,000 broadband, 18,000 voice, and 37,000 television customers, Cablevision CEO Jim Dolan said the company has stopped offering any further discounts to customers that received them once before.

“The customer that has been bouncing from one company to another on promotional/repetitive discounts has hit a dead-end with us,” Dolan told Wall Street analysts during a conference call.

All customers with promotions will now be tracked to prevent extensions or further discounts once the special rates expire. Dolan confirmed the ban will also extend to customer retention offers.

Customers who shop primarily on price in Cablevision’s service area have traditionally flipped between AT&T U-verse, Verizon FiOS and the cable company every few years, usually switching after a promotion expires or rates are increased. Because of fierce price competition, new customers can receive a triple play package of broadband, phone, and television service — including equipment, for less than $85 a month for at least one year. Regular prices are considerably higher.

Cablevision lost most of its departing New York and New Jersey customers to Verizon FiOS, but has been more successful fending off competition in Connecticut, where AT&T has the least capable broadband network among the three providers.

All three companies have attempted price increases over the last few years with mixed results. Cablevision’s eight percent rate hike on broadband this year may have been too much for some customers who shopped around and found a better deal with the phone company.

Despite the loss in customers, Dolan remains firmly committed to more rate hikes, especially for broadband service, noting its speed and features (including an extensive Wi-Fi network) deliver enough value to sustain further price increases.

Cablevision clearly hopes competitors follow its lead and end promotional rate double-dipping as well. If they do, customers will find themselves locked in with regular pricing regardless of the provider they choose.

Some analysts are skeptical Cablevision’s hard-line will last, especially if subscriber losses mount. Cable operators have attempted to restrict promotions in the past but tend to ease them if market share suffers. Despite the third quarter customer retreat, Cablevision’s rate hikes delivered $336 million in broadband revenue during the last three months, an increase from $308 million earned the same time last year.

Optimum profits.

Cablevision customers that managed to keep now-discontinued television packages will soon have to pay an extra $4-7 a month to upgrade to one of several newer packages this summer.

In March 2012, Cablevision dropped many of their “iO” packages in favor of new ones dubbed “Optimum.” The cable company originally let current customers keep the older, cheaper packages, but starting June 3 that will be no more.

Michael Chowaniec from Cablevision’s Government Affairs department notified Connecticut regulators the company was preparing to force customers into newer Optimum packages at a higher cost.

“Legacy customers migrating to comparable packages will experience a rate increase, but will gain between 6 to 23 linear networks and/or premium channels and enhancements and additional On Demand services,” Chowaniec wrote. “In many cases, the rate change is significantly less than the price of the additional channels and services, if purchased on an a la carte basis.”

“Customers on promotions for a legacy video package that is being eliminated will be able to keep their promotional rate through the end of the promotional period and will be migrated at the end of the promotion,” he added.

The rate increases come after an earlier $5 rate hike for broadband service and the introduction of a $2.95 monthly “sports programming fee” paid by most customers. That represents a total rate increase for some of up to $15 a month in 2013.

Life has been getting tougher for Cablevision customers over the past few months. Optimum Rewards members are losing their “Free Movie Tuesday” and discount ticket benefits with the sale of Cablevision’s 47 movie theater chain Clearview Cinemas.

Cablevision’s ruling family even canceled the July 4 fireworks display run for years from their home on Oyster Bay, N.Y. “for personal reasons.”

AT&T is seeking freedom from regulation, oversight and the right to abandon its landline network with the assistance of Connecticut legislators who modeled a state deregulation measure on recommendations from the corporate-funded, AT&T-backed, American Legislative Exchange Council (ALEC).

The legislature’s Energy and Technology Committee voted 20-4 to approve the bill, which would eliminate service and oversight requirements and allow the phone company to raise rates. AT&T has lost most of its landline customers since assuming control of service in Connecticut. Today, only 28 percent of homes in the state choose AT&T for their home phone service. The Office of Consumer Counsel suggests AT&T’s poor performance in the state may have had a lot to do with that, citing the company’s slow job of restoring phone service after a series of storms affected the state.

AT&T wants the power to drop telephone service altogether in areas considered unprofitable to repair or continue to serve. A trio of company-backed bills in the state legislature would hand them that right.

House Bills 6401, 6402 and Senate Bill 888 are all measures that would deregulate the phone company and open public lands for placing cell towers, limit regulator oversight and cut reporting requirements that let regulators track telephone rates.

None of the measures have been introduced on a whim, contend critics. The Connecticut Citizen Action Group released a report showing links between corporate-written model bills produced by ALEC and the current legislation before the Connecticut General Assembly.

HB 6401: House Bill 6401 strips the Public Utilities Review Authority (PURA) of their ability to regulate Voice Over Internet Protocol (VoIP) telephone services. An emerging market, this bill creates deregulation for the sake of deregulation.

HB 6402: House Bill 6402 eliminates the right of regulators to oversee AT&T to make sure it has some form of accountability to the public. The section on annual audits has been gutted, making it impossible to protect the public from rate-fixing. More importantly, it includes a provision to allow AT&T to end service to any customer it wants upon 30 days’ written notice.

SB 888: Senate Bill 888 has an ALEC-drafted provision that allows cell phone towers to be built on public lands on a presumption that the will of telecommunications companies is in the interest of the public good.

“If AT&T is allowed to drop service in unprofitable areas at their sole discretion, if they’re allowed to let service outages drag on for weeks with no consequences, if they’re allowed to jack up rates — of course they will,” Daniel Ravizza of Connecticut Citizen Action Group said in a statement. “‘Trust me’ is not a good enough guarantee for Connecticut consumers.”

ALEC and AT&T’s Legislative Chorus

• Rep. Debra Lee Hovey of Monroe and Newtown and Sen. Kevin Witkos of Simsbury, Avon, and Torrington serve as ALEC’s chair people for the state;
• Rep. John Piscopo is currently serving as ALEC’s National Chair;
• Rep. Lonnie Reed (D-Branford), chairwoman of the state legislature’s Energy and Technology Committee defended the measures saying they would give certainty to the telecom industry which would attract more investment in broadband and phone services. But she admitted once consumers learned of the proposed bills, things got heated quickly. “Some of this stuff is radioactive,” she told The Hartford Courant. “It’s hard even if you change the language to convince people otherwise;”
• “The arguments by opponents of HB 6402 have been shown to be without merit so now they’re resorting to desperate measures and innuendo,” said AT&T spokesman Chuck Coursey. “The fact is modernizing our telecom rules this year will help encourage private investment, job growth and consumer choice at a time when Connecticut needs it most;”
• John Emra is AT&T’s chief lobbyist in Connecticut. Emra was behind last year’s attempts to advance similar deregulation. Emra serves as the Executive Director of External Affairs for AT&T and as the chair of ALEC Connecticut.

“This is part of a national strategy by ALEC to advance a pro-corporate agenda at the expense of consumers,” James Browning, regional director of state operations for Common Cause, said in a statement. “We’ve seen the destructive impact these measures have had in other states. AT&T should not be allowed to get away with it here in Connecticut.”

The New Haven Register notes Browning said the three bills — SB888, HB6401 and HB6402 — closely resemble model legislation ALEC’s legislative template used in 20 other states where telecommunications regulatory overhaul has occurred. In 17 of those 20 states, telecommunications rates have increase, and in some cases, the cost of service has doubled.

Connecticut consumers can share their feelings about the bills through e-mail with their elected officials.

What is the best way to win a big promotion at Cablevision? Be related to the Dolan family that founded the cable system.

Cablevision Systems CEO James Dolan suddenly announced a shuffling of executives at the helm of the cable operation that serves suburban New York, Connecticut, and parts of New Jersey.

Dolan’s wife got the biggest promotion: president of Optimum Services. That represents a big jump for Kristin Dolan, who was last seen helping revive the long dead career of Michael Bolton in a marketing and rebranding exercise that turned the faded pop musician into a de facto Cablevision mascot. Under her leadership, Cablevision managed to put its most important product — broadband, dead last in its triple play marketing campaigns.

Brian Sweeney, Dolan’s brother-in-law, also scored a new title – senior executive vice president of strategy.

Dolan called the management shifts a pro-customer effort that would refocus and streamline the company’s decision-making processes. Since both executives will report directly to Dolan, some industry insiders believe James Dolan intends to tightly consolidate his control over management decisions at the company.

Kristin will keep her role as chief of brand positioning and expand her oversight into the company’s sales and promotional activities. Sweeney will serve as the “long-term strategy” guy, overseeing planning, customer retention, and winning customers away from Cablevision’s biggest competitor — Verizon FiOS.

A large number of former Cablevision executives defected from the cable company in 2011, most heading with former chief operating officer Tom Rutledge to Charter Communications.

Compare Optimum/Cablevision’s Marketing Campaigns: Before <- Kristin Dolan -> With

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Cablevision Ad 2008.flv[/flv]

Cablevision’s ‘Before Kristin’ Advertising (1 minute)

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Cablevision Bolton 2-15-13.flv[/flv]

Cablevision’s ‘With Kristin’ Advertising (1 minute)