Save Access

from: Consumers Union

Cable Competition: Where Up Is Down and More Is Less

From HearUsNow.org, May 23, 2007
By Bob Williams

For some time now big telecom companies such as Verizon and AT&T have been telling state and local officials that allowing them to offer cable television service in their communities will benefit consumers by spurring new competition, driving down prices and improving service.

Being skeptical types, we here at Now Hear This never placed much faith in such sunny promises, particularly when they come from former monopolies that had to be broken up by the government. So suffice it to say we have chosen to judge Verizon by its deeds rather than their words. And it’s fair to say that Verizon’s deeds in the cable television business so far have fallen far short of their promises.

For example, Verizon hiked the price of its FiOS Premier service, its most popular subscriber package, from $39.95 to $42.99 at the beginning of the year. That is a 7.6 percent jump. The monthly rates for add-ons such as HBO and sports channels also rose by $1 or $2 each. For a complete breakdown of Verizon’s rate hikes, click here.

Now comes word Verizon is jacking up the monthly fee for its high-definition digital video recorder service from $12.99 to $15.99 — which works out to a 23 percent increase, by our calculations.

In a remarkable coincidence, Verizon’s new price is just a few cents less than the fee its chief competitor Cablevision charges for its HD-DVR service. Go figure.

And it gets worse, according to Multichannel News.

Verizon is also informing its new FiOS customers they will be charged a fee of $74.99 if they decide to discontinue their service and a technician has to come out and pull the plug. Departing FiOS customers can avoid the fee if they disconnect their equipment themselves and return it to their local Verizon office. Or they can wrap it up and drop it off at a United Parcel Service location using a Verizon prepaid label.

Hmmm. That must be some of that improved customer service that Verizon’s entry into the cable market is supposed to be spurring.