Unknown to them, many EchoStar Communications Corp. subscribers who call in for customer support are forwarded to a vendor with a call center in the Philippines, where cheap labor allows the satellite provider to lower its costs.
EchoStar, which declined comment, isn't the only provider in the multichannel-video space to outsource some of its customer-service operations, although forwarding calls from U.S. customers to the Philippines appears to be an unusual example among pay-TV providers.
But shifting calls outside of regional call centers has been a way of doing business for MSOs and direct-broadcast satellite services. Time Warner Cable, Comcast Corp., Charter Communications Inc. and other big operators have been consolidating local call centers into regional hubs — and shifting more customer-service calls to firms with call centers located throughout the United States and in Canada.
Along with cheaper labor costs, outsourced customer-service operations help operators reduce hold times and allow customers to speak to a live operator 24 hours a day, operators contend.
And as they extend their advanced-services rollouts, MSOs are relying increasingly on the ability to outsource calls to firms that train customer-service representatives in how to handle questions about new services such as high-speed Internet and telephony.
New-service rollouts — especially those involving non-video services — tend to generate more customer-care calls than usual, operators say, and CSRs need additional help to handle those calls properly.
Cable and satellite companies all say they want to improve customer service to attract and retain customers and differentiate themselves from the competition — even though, in some cases, they're using the same vendors to handle customer-service operations.
'A LAYER OF SUPPORT'
"We think of this as a layer of support and providing options for our division that can only help us in providing better services to our customers. But we will remain a local service-based company," said Time Warner Cable executive vice president and chief marketing officer Chuck Ellis.
Time Warner outsources calls for high-speed Internet service to call centers in Canada owned by Convergys Corp. and Solectron Corp.
DirecTV Inc., Time Warner's biggest rival, uses Convergys to handle most of its customer-service calls. But executives said the same Convergys representatives that take calls for DirecTV don't handle requests from customers of cable companies.
"We've always had very specific rules," said Time Warner senior vice president of customer relations Dave Temlak, noting that Convergys representatives who handle DirecTV calls are located in different call centers than their colleagues who do work for Time Warner. "We don't share information between the two operations."
Before Comcast acquired AT&T Broadband in 2002, all customer-service calls for AT&T's core video service were outsourced.
Comcast has brought video-related customer service calls for all of the former AT&T systems back in-house, but uses Convergys for its calls for high-speed Internet and telephony services, Comcast executive vice president of sales, marketing and customer service Dave Watson said.
Comcast uses some Convergys call centers in Canada, but doesn't direct calls to Convergys off-shore call centers, located in India, the Philippines and other cities abroad, Watson said.
The MSO has relied on outside firms to take customer service calls for its high-speed data system for several years, Watson said. "They're a great way to balance the amount of activity that we provide, and then in addition, their level of specialization is such that they're a valuable resource," Watson added.
Watson said Comcast uses APAC Customer Services Inc., of Deerfield, Ill., and other firms to handle outbound calls to customers, attempting to sell them such new products as high-speed data or upgrades to digital cable or other programming packages.
Convergys director of product and industry marketing Curt Champion said the company's 40,000 customer-service reps identify themselves as working for each company they represent. Subscribers shouldn't be able to tell whether they are talking to an in-house CSR at a cable company or a Convergys CSR located at a distant call center.
"Usually the customer has absolutely no idea what's happening with them, because we typically front it with some very sophisticated speech-recognition solutions and call-routing solutions, so that routing may be based on their past calling history, the types of services they have, the menu option they select," Champion said.
Comcast and DirecTV are the only two multichannel video providers with which Convergys has announced outsourced call-center contracts.
Champion said Convergys has call-center deals with five other MSOs, but most cable customers don't allow the vendor to discuss the outsourcing relationships, as the MSOs sometimes close their own call centers when they cut outsourcing deals.
Most major MSOs have pushed to consolidate call centers during the last several years as they have consolidated cable systems into geographic clusters.
In some cases, companies such as Adelphia Communications Corp. cut call-center employees.
Others, such as Time Warner, said they've shifted customer-service representatives to other positions after call centers were closed.
Comcast has consolidated customer-service operations into 70 call centers handling 95% of its traffic, and the MSO owns 15 to 20 small call centers that handle the remaining traffic, Watson said.
Each Comcast division also runs larger "go-to centers" that receive calls from other divisions during peak calling periods and overnight.
As for performance, Comcast answers 90% of customer calls within 30 seconds, Watson said.
Going forward, the MSO is seeking ways to reduce the amount of time CSRs spend on each call.
"We feel we've done a solid job of answering the calls, not keeping our customer waiting to get through to us. But now once they get through to us, are we resolving their problems quickly and without handoffs? That first-call resolution is something that we're focused on, and that is an area that we think we can improve," Watson said.
TIME WARNER STATS
Time Warner employs about 7,000 CSRs, and each of the MSO's 31 divisions operates at least one center. Ellis said the consolidation of call centers started several years ago.
"This business has been about consolidation and trades and swaps and building out core markets to higher levels of penetration in the marketplace, and as we inherit or absorb or buy or trade for systems, that kind of process has been ongoing," Ellis said.
Time Warner's in-house CSRs typically handle calls having anything to do with programming, field service calls, billing issues and calls from subscribers that wish to upgrade or downgrade service.
Subscriber calls for telephony service and calls regarding technical questions for high-speed Internet are outsourced.
Cox Communications Inc. handles most of customer-service calls internally, but outsources calls to Omaha, Neb.-based Sitel Corp. during peak periods.
Interim vice president of customer care Bob Hattori said Sitel helped Cox during snowstorms or wildfires in California that blocked access to its call centers.
In December, Adelphia announced plans to consolidate customer-service operations from 80 to 11 call centers, and to lay off many call-center employees.
"Many of our call centers were sub-scale and in locations where we couldn't provide 24-hour service and didn't have a labor pool to increase the hours," senior vice president of customer care Ellen Filipiak explained.
Adelphia now operates three high-speed-Internet call centers — including one in the MSO's former hometown of Coudersport, Pa. — while other call centers focus on various regions.
Filipiak said Adelphia outsources some calls to a call center owned by West Teleservices in Pensacola, Fla.
Adelphia, which currently employs about 3,500 CSRs, is hiring to staff regional call centers, and expects to have 4,000 CSRs on staff by year's end.
Next week: Upselling subs on the phone.