Cable Proudly Declares Smart Shoppers A 'Lower Quality' Of Customer They Have No Interest In

from the faux-fisticuffs dept

If you live in a broadband and TV market with anything even closely resembling competition, you've probably learned that the only way to get the best rates is to pit ISP retention departments against one another. Often only by seriously threatening to cancel can users force ISPs to bring out their best promotional offers, something you'll have to repeat every few years if you don't want to get socked with higher rates. The ideal consumer then, from the broadband and cable industry's perspective, is one that grumbles a little bit but can't be bothered to do a little extra legwork to secure better rates (read: the vast majority of users).

Of course pitting ISPs against one another assumes you even have the choice of more than one decent broadband provider, something that's certainly not a given. Even in markets we tend to think of as competitive, we're increasingly seeing non-price competition (what I affectionately refer to as "wink wink, nod nod" competition), wherein duopolies quietly work together to slowly edge prices upward -- because there's simply no repercussion for doing so. The New York City tri-state area, where Cablevision and Verizon FiOS engage in a customer tug-of-war, is a perfect example of this kind of not-really-competition.

While Verizon and Cablevision did compete intensely for a short while in New York, the two sides have in recent years declared what can only be called a competitive cease fire. Both have dramatically scaled back or stopped promotions entirely and raised rates whenever possible. In fact, a study last year noted that while all cable rates are increasing much higher than the rate of inflation, Cablevision customers see some of the highest rates in the nation.

Cablevision executives meanwhile have made their disdain for the smart consumer abundantly clear over the last few years, calling smart shoppers a "dead end" that the company has no interest in pursuing. Speaking at a recent investor conference, Cablevision vice chairman Gregg Seibert took this rhetoric one step further, declaring that customers that follow the best promo offer are a "low quality" subscriber that the company is happy to get rid of:

"We found out that we were pushing subscribers back and forth on a highly promoted basis," said Cablevision vice chairman Gregg Seibert, speaking Monday at the Deutsche Bank 2015 Media, Internet & Telecom Conference in Palm Beach, Fla. "I don't want to roll a truck to you every two years if you keep going back and forth to another provider … So we're getting rid of that lower quality, lower profitability base of subscriber."

Except "pushing subscribers back and forth" is what competition is. Fighting to offer a better value than the other guy is how competition works. That Cablevision and FiOS can just choose when they'd like to seriously compete illustrates perfectly how even in U.S. markets we consider to be more competitive, what we're usually witnessing is just coordinated competition theater. When consumers only have one or two real options for service, and both of those options quietly agree on an unwritten competitive cease fire, there's simply no longer any reason to even try. It's then a lovely layer of hubris to publicly express disdain for customers looking for something better.

Filed Under: broadband, budget minded customers, cable, competition, promotions
Companies: cablevision, verizon