New Kids on the Block

Michael Harris
BroadBananas
Michael Harris
10/2/2008



8:45 AM -- Yet again, when it comes to service providers, users prefer the new kid on the block. This time, though, that means a preference for telcos over cable MSOs for television.

The latest video service satisfaction survey from J.D. Power and Associates finds that consumers in key U.S. regions are more satisfied with AT&T Inc. (NYSE: T)'s U-Verse or Verizon Communications Inc. (NYSE: VZ)'s FiOS TV services than those offered by cable and satellite incumbents. (See JD Power Props Up U-Verse, FiOS.)

Specifically, J.D. Power found that:

AT&T U-verse ranks highest in the North Central (with an index score of 730), West (697) and South (706) regions. In the East region, Verizon FiOS ranks highest with a score of 677. This is the first year both AT&T U-verse and Verizon FiOS are included in the study. AT&T U-verse and Verizon FiOS perform particularly well in the offerings and promotions factor, specifically with their bundled pricing options. Both providers also perform well in the performance and reliability factor, especially regarding reception clarity.


The researcher's video survey results mirror consumers' preference for telephone service from their cable provider, as well as small business satisfaction with cable-delivered solutions. (See Phone Subs Happier Not Talking and Cox, Qwest Get Biz Kudos.)

In the past, cable MSOs have crowed about J.D. Power results as a validation of their service quality. The telcos are now likely to do the same about video. As likely, though, these results may offer an interesting study in competitive psychology. Consumers could simply be so jazzed about having the opportunity to switch to a competitive service provider that the grass seems much greener on the new side of the fence.

— Michael Harris, Chief Analyst, Cable Digital News

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