Cable Company Admits It Gives Poor Credit Score Customers -- Even Worse Customer Service

from the from-bad-to-worse dept

Fri, Jun 3rd 2016 10:40am — Karl Bode

As I've noted a few times, telecom sector investor conferences are amusing for the simple fact that many cable executives -- notably those of the old guard -- haven't yet figured out that what they say at them can be heard by the general public. As a result we'll often see companies make candid statements they'd never say otherwise, forcing PR departments to then try and backpedal away from the comments.

The latest case in point is Phoenix-based cable provider Cable One (formerly owned by the Washington Post), whose CEO crowed to attendees of an investor conference last month that the company has figured out a way to identify poor credit customers and somehow provide them with even worse customer service than the cable sector usually provides:

"According to company CEO Thomas Might, the Phoenix, Ariz.-based MSO has deployed a "very rigorous FICI credit scoring process" on its video customers since 2013. "We don't turn people away," Might said, but the cable company's technicians aren't going to "spend 15 minutes setting up an iPhone app" for a customer who has a low FICO score. "What we found is that through lifestyle and billing analysis, we could start to pinpoint where churn and bad debt was coming from, and credit scoring started to be a really good test," Might said.

Again, that's a cable executive bragging that he's now identifying you based on your credit score, and then refusing to give you quality support if you score doesn't meet an entirely non-transparent standard at the company. While the CEO failed to detail just how deep the practice goes at CableONE, there's several problems with this, not least of which is the fact that many people with bad credit scores may be born into such scores by no fault of their own. And many of those customers may pay their bill every month -- yet under such a system would still find themselves being treated as a second-class citizen, refused even a standard level of customer service.

I spoke to several telecom sector lawyers that had mixed opinions on whether or not this is illegal. I came away with the general impression that while you might be able to hold a company to legal account for targeting customers in this way, such a case would be a steep uphill climb. Still, many of them argued that the practice was no less ugly, in that it could tend to unfairly single out communities of color:

"The use of credit score to screen potential customers is already a barrier to home internet adoption that disproportionately impacts communities of color," says Free Press Research Director S. Derek Turner. "But what Cable ONE is apparently doing takes this to a much more dangerous territory. Because there are systemic biases that impact the credit scores of communities of color, Cable ONE is in essence adopting a policy that will result in inferior service for customers based solely on the biased credit score metric, and as a consequence, people of color will disproportionately receive this inferior service," he added."

Consumer advocate and telecom lawyer Harold Feld notes that as the FCC pursues new privacy rules for broadband customers, it's possible that the rules could cover potential discrimination of this type:

"The FCC has an ongoing proceeding to apply Section 222 (47 U.S.C. 222) to broadband. For those unfamiliar with the statute, Section 222 prohibits a provider of a “telecommunications service” from either disclosing information collected from a customer without a customer’s consent, or from using the information for something other than providing the telecom service. While most of us think this generally means advertising, it means a heck of a lot more than that — as illustrated by this tidbit from Cable One.

ISPs opposing the FCC's broadband privacy push have tried to argue that the FCC is unfairly singling out ISPs while ignoring the data collected by the likes of Google and Facebook, which companies like Verizon and Comcast hope to increasingly compete with on the ad front. However, this (usually quite intentionally) ignores the dramatically different, uncompetitive nature of last-mile broadband versus more competitive internet services markets. Feld argues that the CableONE efforts perfectly illustrate how broadband customers can't vote with their wallets or flee to less privacy-intrusive companies, often because the cable company will be the only competitor in town:

"While broadband providers want to make this an argument about competition with other advertisers, Cable One shows us how broadband providers can — and do — use information obtained from customers for much darker, harmful purposes. Google can certainly obtain enough information about you to get your FICO credit score. That’s certainly bad and a privacy violation. In theory, however, I can use things like encryption and flushing cookies to protect myself from Google — or even avoid Google entirely. In the case of my broadband provider, I have no choice. I must turn over to my provider information usable in obtaining a FICO credit score to my broadband provider so my provider can actually come out to my house, activate my connection, and bill me on a regular basis."

So at the end of the day, a cable executive bragging about his company's plans to use credit scores to provide worse support -- may find himself a cornerstone of the FCC's broadband privacy rulemaking process. If there's a positive side to the whole affair, it's that cable customer service is so aggressively abysmal already, it might just be physically impossible for cable companies to do any worse.

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: broadband, credit scores, customer service, fico scores, thomas might
Companies: cable one

29 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

Jason, 3 Jun 2016 @ 10:49am

I may have to add the phrase "aggressively abysmal" to my repertoire. It nicely captures a lot of detail in just two words.
[ link to this | view in thread ]
concerned consumer, 3 Jun 2016 @ 10:55am

two words
"aggressively abysmal"

What he said!
[ link to this | view in thread ]
afn29129 (profile), 3 Jun 2016 @ 11:01am

Credit scores can change
A person's credit score can change.. So does CableOne check each callers' score every time a customer calls. A customer might of had good credit when the account was opened, and poor credit later on... or the reverse.
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 11:09am

So Cable One has a new department
Customer Disservice
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 11:11am

I wouldn't setup an iPhone app for anyone either ..
.. I have better things to do with my time.

Someone needs to pass a note to Feld that the middle 90's called and they want their security blanket of encryption and cookie flushing back.
[ link to this | view in thread ]
Mason Wheeler (profile), 3 Jun 2016 @ 11:19am

In the case of my broadband provider, I have no choice. I must turn over to my provider information usable in obtaining a FICO credit score to my broadband provider so my provider can actually come out to my house, activate my connection, and bill me on a regular basis.

Wait, what?

I've been a Comcast internet customer (no choice; they're the only game in town) ever since I moved into my current apartment. At no time has a Comcast technician ever had to come over for any reason.
[ link to this | view in thread ]
John85851 (profile), 3 Jun 2016 @ 11:35am

Re: Credit scores can change
A good point, but you lost it with "might of". The phrase is "might have" or "might've". There is no phrase in the English language called "would of", "could of" or "should of".
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 11:37am

Re:
Well, you said "apartment" and he said "house". If you're in an apartment block, it's likely it's pre-wired for cable and your unit is en/dis-abled from a central point, so you wouldn't see any service personel.

If you are in an apartment in a house, that's different...
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 11:38am

Re: Re: Credit scores can change
And if you're going to be all pedantic, "would have", "should have" and "could have" are not phrases...
[ link to this | view in thread ]
Ninja (profile), 3 Jun 2016 @ 11:48am

Re: Re:
An apartment in a house

Cat owners may giggle over this one. In my case it's an apartment in an apartment.
[ link to this | view in thread ]
Ninja (profile), 3 Jun 2016 @ 11:50am

If there's a positive side to the whole affair, it's that cable customer service is so aggressively abysmal already, it might just be physically impossible for cable companies to do any worse.

Wait till they add quantum physics...
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 12:00pm

It's the new form of discrimination. Employers are also required impeccable credit scores even though it has nothing to do with their role. I'm 100% certain Silicon Valley Bank REQUIRES an 800 credit score to get an offer of employment. It's been confirmed through the grapevine of recruiters in the area. Otherwise they drop you like a bad habit even after 10 interviews. Ask me how I know.
[ link to this | view in thread ]
PRMan (profile), 3 Jun 2016 @ 12:21pm

Credit history is not disproportionate based on color
It's a record of exactly what you personally have done.

That said, if they are paying their bill, they are entitled to equal service.

If they are behind on their payments, then, yeah, maybe put them to the back of the queue.
[ link to this | view in thread ]
Manabi (profile), 3 Jun 2016 @ 12:45pm

Re:
When my grandfather died, Mom inherited his house. He'd had cable TV there for a long time, but Comcast still required a tech to come out to setup cable TV/Internet/phone for my parents. Even though the house was already wired up for cable. At least in that case they went ahead and ran a new drop while they were at it, and we took the opportunity to have them put a second cable in on the other side of the house, mostly because the computers are on that end of the house.

Having a tech come to activate TV/Internet/Phone is standard operating procedure for Comcast and houses now. The difference probably is that you're in an apartment.
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 1:05pm

Re: Credit history is not disproportionate based on color
you know what ? i would feel just an eensy, teensy, tiny bit of sympathy for that view, if Big Telco had not already RIPPED US ALL OFF for BILLIONS for promised broadband THEY DID NOT BUILD OUT...
Not to mention the billions in over-priced, under-powered services we pay monthly...
fuck Big Telco with a sideways pineapple...
[ link to this | view in thread ]
Mason Wheeler (profile), 3 Jun 2016 @ 1:29pm

Re: Re:
Huh. I guess you learn something new every day...
[ link to this | view in thread ]
Shadow-Slider, 3 Jun 2016 @ 2:04pm

Re: Re: Credit scores can change
A good point, but you lost it with "might of". The phrase is "might have" or "might've". There is no phrase in the English language called "would of", "could of" or "should of".

There are, but they only use by the poorly educated, those who want to appear poorly educated, or just plain do not care about grammar.
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 2:09pm

Self Fulfilling?
So if you have a poor fico score, you get treated poorly. So if you get treated poorly, you dump the provider.

Seems pretty obvious where the exec is getting his churn and burn issues from. Why would anyone stay if they are dumped on.

He is causing his own problem.
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 2:19pm

Will this be the point where Congress realizes,
that the Cable cabal is involved in private trade regulation and break them up? I mean after all, if they are pulling this data from user statistics, what good are the credit reporting companies?

I imagine somebody at Equifax is instructing BJ's, learjet rides and Cuban cigars be withheld from Congress as we speak.

What is a poor Congressman to do? Accept bribes from the credit reporting companies, or accept bribes from the Cable providers? Or both? It must be very confusing.
[ link to this | view in thread ]
ltlw0lf (profile), 3 Jun 2016 @ 3:01pm

Re: Credit history is not disproportionate based on color
It's a record of exactly what you personally have done.

Well, that or a record of what someone has done with your Social Security number, name, address, etc.

I was once denied a loan refinance because I carried too much debt. I owned a home, two cars that were paid off, and no credit card debt, but was told I owned two homes, five cars, three of which I was still paying off, and an RV which I owed a considerable amount on, and thus was living well beyond my means.

Someone at the credit agencies had added my records and my father's records (despite having different names) together and I now had all of his credit, as well as my own, under my name.

And he had no issues buying cars or refinancing loans because he had perfect credit. Luckily a call to the agencies, and a lawyer, fixed all the issues (eventually.)

There are just way too many screw-ups on the part of the credit reporting agencies to believe that it is a record of anything you have done.
[ link to this | view in thread ]
AC720 (profile), 3 Jun 2016 @ 3:38pm

Comcast never pulled my credit or validated my ID
Joined up with Comcast last fall and yes I may be the ONE happy Comcast customer, sitting along side the "one funny German Joke" or something but here I am.

During the install process, at NO time did Comcast obtain my SSN or run my credit. I opted to have them verify my ID in person, but when the installer was here running wires, he never asked for my ID and I didn't sign anything.

They took me as a customer without having any actual idea who I was. I was shocked.
[ link to this | view in thread ]
That Anonymous Coward (profile), 3 Jun 2016 @ 5:50pm

Well we have this model that shows for really large groups the credit score is a great predictor of things.

Of course there might not be people who live up to the model, who might have horrible credit, but learned from that lesson and pay the bills quickly & on time. But we treat them the same as someone who just keeps walking away from bills.

Why waste time on treating consumers like individuals when we can just use this giant model based on data that is notoriously bad? We can save money & justify treating our customers like shit, because this magical number says it is okay. And we'll get away with it because we're allowed to be monopolies who get government handouts while screwing those people who end up paying us twice.
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 7:22pm

Re: Re: Credit scores can change
stuff changes get use ta it grampa
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 7:31pm

Re: Re:
If the phone is registered as a land line with the e911 service then the provider is required to register accurate location information in the e911 system. That's why they have to have a tech install the phone and document it's location.
[ link to this | view in thread ]
Anonymous Coward, 3 Jun 2016 @ 7:37pm

Yet another great model
We also have this really great model that shows that skin color is a good predictor of future criminal activity. I mean, just look at the racial makeup of the prison system!
[ link to this | view in thread ]
Arturio Cudgel, 3 Jun 2016 @ 8:26pm

Re: Re: Re: Credit scores can change
"There are, but they only use by the poorly educated, those who want to appear poorly educated, or just plain do not care about grammar."

Either best troll ever or proving its own point.
[ link to this | view in thread ]
Coyne Tibbets (profile), 3 Jun 2016 @ 11:16pm

Useless statutes - Section 222
For those unfamiliar with the statute, Section 222 prohibits a provider of a “telecommunications service” from either disclosing information collected from a customer without a customer’s consent, [...]

It prohibits nothing. The key word is "consent", which every broadband provider grants itself in a paragraph buried in the user agreement.
[ link to this | view in thread ]
Uriel-238 (profile), 4 Jun 2016 @ 11:23am

This reminds me of the plan to deny guns to No-Flyers
After one of the rampage shootings the notion resurfaced that people on the no-fly list (or even it's big brother the terror watchlist) should not be allowed to own firearms, which wouldn't have prevented the recent shooting.

The presumption, of course, was that there was a well overseen fair process by which people became no-fly, and a reasonable means to get off the list.

There isn't anything of the sort. If some official or FBI guy wants you on the no-fly list, you're on and you're fucked.
[ link to this | view in thread ]
Anonymous Coward, 4 Jun 2016 @ 4:33pm

Re: This reminds me of the plan to deny guns to No-Flyers
...you're fucked.

And not in a good way, either.
[ link to this | view in thread ]