Light Reading

Despite Efforts, Cable Service Still Sucks

Mari Silbey
5/20/2014
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Nobody likes the cable guy.

In the latest American Customer Satisfaction Index (ACSI) report, US pay-TV providers and Internet service providers saw their customer satisfaction rankings fall again. And, as usual, US cable operators led the way down in both categories, with MSO giants Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Time Warner Cable Inc. (NYSE: TWC) occupying the last two slots respectively.

As a group, pay-TV providers dropped another 4.4% in the ACSI rankings, scoring a total of 65 on a 100-point scale. The only companies that fared worse in the annual assessment of communications industries were Internet service providers. As a category, ISPs fell 3.1% to a score of 63. In both cases, cable operators ranked at the bottom of the pack,

The 2014 ACSI report is based on interviews with more than 12,000 consumers across six industries: cellular telephones, computer software, fixed-line telephone service, ISPs, subscription TV service, and wireless telephone service. Cellphone companies, with a score of 78, were the only ones to improve their industry ranking year over year, while both computer software and wireless service companies stayed steady with respective scores of 76 and 72. Fixed-line phone companies saw their industry rank drop 1.4% to 73.

Survey respondents blamed the drop in cable satisfaction scores on high subscription prices, unreliable service, poor performance, and poor customer support. And while cable companies may not want to lower their monthly fees, the continued negative response to customer support comes as a blow after the industry's very public efforts to boost service quality. Not too long ago, for instance, Time Warner Cable proclaimed that it has been "laser-focused on improving customer service and the customer experience." (See What's Next for TWC.)

Not only have cable executives made a point of saying that they're trying to do better, but they've also spent a good deal of money in the attempt. According to Alex Mitchell, president and founder of self-service technology company StepOne, Inc., cable and telecom providers have opened their wallets wide in an effort to improve customer support.

"That is the largest sub-segment of spending in the CRM support [market]… [It's] telco and cable providers," Mitchell told Light Reading.

StepOne launched its own customer relationship management product last week, called Contextual Care. It has already landed Telstra Corp. Ltd. (ASX: TLS; NZK: TLS), Australia's largest telecom company, and an unnamed US Tier 1 cable operator as customers.

The StepOne technology predicts subscriber problems through contextual information, such as order and product status, billing data, location, and more. The software then triggers a response so that users are presented with relevant support information. Over time, the self-service platform adapts to user behavior and improves support recommendations accordingly.

In Telstra's case, the telecom company is combining StepOne's Contextual Care product with smart tags on products, which embed a near-field communications (NFC) code, a service code, and a QR code. Customers can scan these codes with a mobile device and find out how to resolve support issues.

Amdocs Ltd. (NYSE: DOX), a leader in the telecom back office market, has also been working on addressing customer support problems through data analysis and predictive algorithms. One solution that the company highlighted recently at The Cable Show is Proactive Care. Proactive Care allows service providers to leverage structured and unstructured data to try to pre-empt service calls and improve customer retention rates. Amdocs also has a Social Care solution for managing customer support over social networks and an Order to Activation solution for guiding the customer process from service order and service activation.

As cable's customer satisfaction scores keep dropping, there are a wide array of solution providers looking to help companies improve their service records. Market pressure has put customer support high on the cable priority list, and the higher the priority, the higher the budget. So some firms are primed to cash in on cable's woes.

— Mari Silbey, special to Light Reading

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Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
5/21/2014 | 9:50:21 PM
Re: Laser focus
KBode - "After ten years of bad reports like this an bi-annual promises that things are getting better, I think one thing is pretty clear: Time Warner Cable and Comcast don't really care what we think or about reports like this. They probably care a little about the bad press, but pretty clearly they've been so confident in earnings, subscriber adds and retention rates they just figure it's ok to ignore these."

Indeed. Investors care about profits. They only care about customer satisfaction to the extent that it impacts profits. 

"If more people voted with their wallet (or we had more competition so people COULD vote with their wallet) ... "

That's the key: If you're unhappy with your cable provider, where are you going to go? Your phone company is probably similar. 
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
5/21/2014 | 9:45:08 PM
Re: Laser focus
I wonder if more competition would result in better customer service. 
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
5/21/2014 | 9:36:03 PM
Re: Comcast
14 is low. IIRC, I get 24 Mb at my home office. 

At the airport now-- rocking a big 2.7 Mb here. 
VictorRBlake
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VictorRBlake,
User Rank: Moderator
5/21/2014 | 7:55:35 AM
Re: Service vs. Customer Service
davidhoffman,

 

While what you say may be true in some individual markets, it isn't universally so. In many markets the telcos (AT&T or Verizon) offer FTTH services with the same or higher data rates. More broadly VDSL is widely available in large markets and is obviously a competitive price/feature product.

But notably if you look at markets where there is NO CABLE service at all, customer service ratings for telcos are even lower. That is to say, where there is no competition customer service is worst.

Your argument, if i understand correctly, is that ADSL is not competitive, well it might not be in some markets, but in others it might be available where cable is not.

I think my point still holds true, which is that customer service in telecom -- wireless, telco, and cable is notoriously poor. I think its worth understanding and fixing, but I don't think the majority of complaints are about the product itself -- they are more often about customer interactions with the company, billing issues, etc.
davidhoffman
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davidhoffman,
User Rank: Light Beer
5/21/2014 | 5:42:35 AM
The only way to get improvement is with competition.
Look what has occcurred in Kansas City KS and Kansas City MO. Google Fiber comes in, and after a relatively short interval, Time Warner Cable(TWC) brings in some technicians who actually have some knowledge, tools, parts, and authority to fix problems that TWC subscribers in the area have complained about for many years. TWC was not going to do anything to fix these issues on its own in a monopoly environment.

We in the USA need some way to encourage and support alternative wireline service providers. Municipal public utility FTTH or Google Fiber type arrangements to get the cable industry to take the customer service issue seriously. One of the interesting stories that is told about the Chattanooga TN EPB Fiber deployment is how much EBP had to upgrade its customer service in going from being an electric power public service company to an electric power service company and triple play FTTH service company. What was acceptable customer service as an electric power delivery company was determined to be unacceptable as a FTTH triple paly service provider. EPB was worried they could loose the whole FTTH deal because they would not be able to deliver a better customer service experience than the local cable company, so they had to make sure they exceeded in a positive way the customer service level of the local cable company. 
davidhoffman
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davidhoffman,
User Rank: Light Beer
5/21/2014 | 5:21:08 AM
Re: Service vs. Customer Service
If cable and telephone company services were roughly equal you could state that the subscription percentages show that cable is the preferred service. Sadly the services are not roughly equal. Th typical telephone company triple play offering involves limited low end ADSL2+ internet speeds(below 3 Mbps in the real world), telephone voice, and an offer to use satellite pay TV through some coordination with Dish Network or DirecTV. 

We in the USA do not have large scale widespread ubiquitious VDSL2 based telephone company offerings to seriously compete with cable DOCSIS 3.0 internet services, VOIP, and video(TV) offerings. We also have numerous multifamily(apartment) building owners who strictly interpret the FCC OTARD rules, thus limiting the ability to use satellite pay TV. 

The end result is that cable triple play, or at least double play for video and internet, is the only "choice" available.

We need more competition in the wireline market, perhaps by easing the rules about public utility municipal FTTH deployment.
victorblake
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victorblake,
User Rank: Lightning
5/20/2014 | 9:34:00 PM
Service vs. Customer Service
Mari,

 

I think there are two different terms here potentially being used interchangeably. The first is the service and how it works. In the case of a service provider -- the service is their "product." I think the macro enconomics show that cable services (having more than 60% of broadband market share in the US) are preferred over telco services. That is "a better product."

The second term is "customer service". As we all know, this is not how the product or service works, but how -- for example, the company providing the service responds to customer queries, handles billing, makes customer appointments, and other interactions with the customer. Its an area of great challenge for all telecom operators (telcos and wireless operators also have notoriously poor customer service).

I think it is important to distinguish between the two and unfortunately I feel that the title of your article is either potentially misleading or at the minimum blurs the disctinction between the two terms.
MMQoS
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MMQoS,
User Rank: Light Sabre
5/20/2014 | 7:23:13 PM
Re: Laser focus
Laser:

I agree with you that sports is an excellent example and where HD video quality really is a factor given the way that video compression/decompression works.  The video service providers will continue to own the market vs OTT for the same reason that Sarah made about I'net speeds.  In almost all cases a video service with I'net included (i.e. 3 play) will have a dedicated amount of b/w set aside for the delivery of HD quality video.  I one is only buying I'net service from an internet provider, there is no dedicated pipe for the video service. 

Do I want to watch the Super Bowl on an OTT type of connection, when the play for the winning touchdown is being reviewed, and the DASH (Dynamic Adaptive Streaming over HTML) substantially degrades the picture quality due to a drop in available b/w.  Not me.

 
Phil_Britt
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0%
Phil_Britt,
User Rank: Light Sabre
5/20/2014 | 6:31:33 PM
Re: Laser focus
Despite lack of customer service (my provider actually isn't too bad compared to the horror stories I've heard from others), I don't think there will be significant cutting of the cord until there's a way to get sports content at a competitive price.

Granted, I'm a reformed sportswriter, so I am more concerned about sports than some people, but between major league sports and Big 10 (though as a Purdue grad, last season not having access would have been better), getting additional OTT subscriptions to watch the games I want would be prohibitive.

Based on the popularity of ESPN and fantasy sports, I would say there are plenty of others who stay with cable because their unhappiness with service isn't enough for them to pay higher prices to get the sports they want without cable.
gconnery
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gconnery,
User Rank: Light Sabre
5/20/2014 | 6:21:26 PM
Re: Laser focus
Agreed.  They can't even get simple things right.  Return an item to Comcast.  Do they credit me on my bill? Nope.  Show them the iPhone picture I took of the receipt they gave me.  Finally get credit.  More hassle to get compensated for the time in between.  Etc.


Billed amount changes month to month?  Owned equipment credit disappears when they move it from one section of the bill to another?  Got to stay on top of them just to get the bill correct.  No human beings involved here, just bad programming (or on purpose).

CableCARD installs still a horrid experience.  Comcast can't be bothered to stock them or train anybody.  As you say, no competition so why would they care about their customers?
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