Cable wins some, but still loses where it hurts

Wed, 08/31/2005 - 8:00pm
Jeff Baumgartner

Jeff Baumgartner
Jeff Baumgartner
The numbers show
that cable still has
a lot of room for
The just-released results from JD Powers' annual Residential Cable/Satellite TV Satisfaction Study provided a classic case of good news/bad news for the cable industry.

On the good side, operators appear to be doing a much better job on customer satisfaction. WOW!, for example, scored the best overall, marking the first time a cable operator topped the list since 2001. Satellite, meanwhile, had an off year.

But that trend has not translated into better cable subscriber retention numbers. The survey, based on responses from 11,586 households, showed that 60 percent of homes only subscribed to cable, versus 62 percent in 2004, and 66 percent in 2000. DBS came in at 27 percent, up from 19 percent and 12 percent from the corresponding time frame.

Knowing that, it would be easy to believe that all of the good cable is doing on customer satisfaction really equates to "good for nothing" when it comes to subscriber retention. But not so fast. Despite the fact that it continues to sap subs from cable, DBS is going in the exact opposite direction on the customer satisfaction index. EchoStar, the survey's big winner in 2004 with a score of 725, was off 17 points. DirecTV was a bit better, scoring a 716, five off its mark in 2004.

JD Powers was quick to note that satellite customers overall are still more satisfied than cable subs, "but if satellite providers want to continue to attract subscribers away from cable, customer satisfaction is a critical area where they can't afford to lose ground." By the same token, it's an area where cable is gaining ground, but must do an even better job if it is to gain more of it.

The numbers show that cable still has a lot of room for improvement. Of the 12 MSOs listed on the JD Powers survey, eight fell below the industry index average of 667.

Plus, the industry needs to avoid public black eyes that can erase the progress made, like the one dealt to Comcast, sadly and ironically on the same day the JD Powers survey results were released. The Chicago Tribune told the story of a customer who was having some service issues with her digital video recorder, was forced to call many times, and grew increasingly frustrated. To pay her back for her apparent insolence, someone replaced her name with the term "Bitch Dog" on her next bill. She declined the operator's offer of two months of free service, and, not surprisingly, has put in a request to cancel her service. To Comcast's credit, it quickly issued a public apology to the customer, and fired those responsible for the incident. Of course, worse things have happened with cable and DBS customers, but the timing of this one just made its mention unavoidable.

So, what does this all add up to? The industry has made tremendous progress in the historically weak area of customer satisfaction. But to make that broader trend stand up and even improve, the devil (or maybe a CSR gone bad) is still in the details.


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