Why are subscribers leaving cable? Higher prices, bad service, lousy perception

Jim BartholdDespite a recent report that apparently minimized the damage cord cutters are doing to cable, there's no denying that an awful lot of people are removing Comcast from their Quicken financial software's memorized transactions.

Even the most superficial glance offers at least one big reason why: Cable's expensive and times are tough. No one cares that cable operators must pay a toll for cable-specific programming and that broadcasters are demanding their own pound of flesh for programs that can legitimately be seen over-the-air.

The retransmission sinkhole has been widening since around 1992 when retrans consent changed how broadcasters and cable operators did business. Matt Polka, ACAAt first it was a little thing: broadcasters asking for their local channels to show up with the same numbers on cable systems.

Then "the content owners really got smart and said, 'We have this valuable asset that we can hold hostage. We have a monopoly marketplace because network non-duplication rules give us a monopoly marketplace and we have the right to demand payment," said Matt Polka, president-CEO of the American Cable Association and a man who's been around long enough to see the friendly exchange between local channels and local cable operators turn into MSO-wide blackouts of broadcast networks to giant multichannel video distributors.

Things really went in a strange direction in 1995 when the broadcasters--actually giant multicontent owners--started bundling their cable channels with their broadcast channels and presenting them as retransmission "suggestions."

"You had (News Corp.'s) Fox with FX; (Disney's) ESPN with ESPN2 and now today some 80 or 90 channels are on the cable dial simply as a result of retransmission tie-in," said Polka. "Those channels would not have been there but for the ability of the major content providers, major networks to tie carriage of them to retransmission consent."

Subscribers moan that they don't want all those channels, and cable operators do an awful job of explaining why they're there. Consumers start moving all over the place to find service providers with less channels, or at least less expensive channels, and cable operators do a horrific job of explaining why prices continue to go up. And the broadcasters continue to gnaw on the hands that feed them.

And there you have one big reason why customers are fleeing: It costs too much to get cable TV.

The other big reason is the elephant in the room (no slight intended to Republicans): poor customer service. Cable talks the talk, but survey after survey and conversation after conversation proves that the walk is, at best, a gimpy hobble. Cable customer service stinks; just ask anyone at the supermarket or at the 19th hole.

Just ask Joshua Bennett. He's the eight-year-old kid who ended up with a $452 Comcast bill for service in Augusta, Ga.--even though he lived in Chicago. According to the local news reports, the kid's identity was stolen and an account in his name opened with Comcast in Augusta. To be fair, the Comcast reps told Joshua and his mom that they needed to get the police involved and Comcast's general manager in Augusta, Abu Khan, issued a reassuring statement that the company takes "any incidents of fraud serious and will work with police in their investigation ... and will get the family in contact with the right people."

OK, it's not terrible customer service and it's not the system's fault. But can't you already see the heads nodding up and down like those damnable bobbleheads: "D'ja hear about the eight-year old kid that got a $450 bill from Comcast? Typical, huh? Just like a cable company; probably raised the rates after they sent him the bill and then charged him a late fee."

Perception is more powerful sometimes than reality, and the cable industry is being abandoned because it's perceived to be expensive and it's perceived to be heartless. It may actually be both or it may be neither; but that's really beside the point.--Jim