Cable TV Subscribers More Annoyed About Prices: J.D. Power


Consumers today are less satisfied with their monthly pay-TV bills compared with last year, according to J.D. Power and Associates' annual TV customer-satisfaction service survey -- and cable subscribers are more likely to feel ripped off than telco or satellite TV customers.

The average satisfaction rating for the cost of pay-TV prices fell 2.5% on the research firm's "2010 U.S. Residential Television Service Satisfaction Study," from 555 on a 1,000-point scale last year to 541 in 2010. At the same time, overall customer satisfaction with television service providers was essentially unchanged, with an average score of 629 in 2010 (down three points from 632 last year).

About 74% of customers who say they "definitely" or "probably" will switch TV providers in the next year cite price as a major factor, the survey found. The takeaway, according to J.D. Power director of telecommunications Frank Perazzini, is that TV providers must "better communicate their price-value proposition, as customers are increasingly voicing irritation with the amount of their monthly bill."

Cable operators were rated much lower on satisfaction with the value of the service, a phenomenon attributable in part to their incumbent status versus competitors. The cable TV average for satisfaction on cost was 22% lower than for telco services -- AT&T U-verse TV and Verizon FiOS TV -- and 18% lower than satellite providers DirecTV and Dish Network.

As has been the case in the last several years, telcos and direct-broadcast satellite operators also scored higher on overall satisfaction than cable across J.D. Power's four geographic regions for the most part. For a third consecutive year, AT&T U-verse TV ranked highest in the West (with a score of 698) and South (732) regions. AT&T U-verse also was tops in the North Central region (728). In the East region, Verizon FiOS TV turned in the highest marks, also for a third straight year, with a score of 679.

Among those turning in below-average regional scores on the 2010 survey were Comcast, Time Warner Cable, Charter Communications, Mediacom Communications and RCN.

J.D. Power also found that the number of digital cable customers who subscribe to "basic-only" service has increased to 44% in 2010 from 40% in 2009. The firm defined "basic-only" as cable service without any premium or movie channels.

"Economic issues are still major considerations for many households across the country," Perazzini said. "Customers who are foregoing premium channels are filling the void with video-on-demand, pay-per-view, movie rentals and time-shifted DVR content."

Negative perceptions about the cost of cable TV appear to have affected customers' rates of recommendation. Among cable customers, 56% said they "definitely" or "probably" will recommend their provider to others, down three points from 2009. Meanwhile, 77% of satellite TV customers said the same (down one percentage point from last year) while telco TV subscribers were unchanged at 84%.

By region, the top-scoring providers were:

• East: Verizon (679), DirecTV (677), Dish (665), Cox Communications (636) and Cablevision Systems (636)
• South: AT&T (732), Verizon (684), DirecTV (676), Bright House Networks (665), Dish (661), Insight (646) and Cable One (643)
• North Central: AT&T (728), WOW! (724), Cox (687), Verizon (679), DirecTV (670), Insight (656) and Dish (651)
• West: AT&T (698), Verizon (686), DirecTV (675), Dish (661), Cable One (653) and Cox (644)

J.D. Power's 2010 TV service satisfaction study is based on responses from 28,489 U.S. households and was fielded in four waves: November 2009, January 2010, April 2010 and July 2010. The survey measures five factors to determine overall customer satisfaction: performance and reliability; customer service; cost of service; billing; and offerings and promotions.