Cable-TV Industry Tries to Shake Bad Reputation

Even though U.S. cable companies have had success in winning customers with all-in-one packages of video, Internet and phone services, they still struggle with a reputation for poor customer service.

Top cable operators such as Comcast Corp. (CMCSA) and Time Warner Cable Inc. (TWC) are expanding their customer service operations to make common complaints -- like waiting all day for the cable guy -- a thing of the past. But analysts say it won't be easy.

Cable's service shortcomings are one of the reasons satellite television providers are adding more new customers than cable, even with cable's success in offering competitively priced combined TV, Internet and phone packages.

"Satellite leads because they place so much emphasis on customer care," said Tuna Amobi, an analyst at Standard & Poor's. Cable operators have done a much better job in recent years, but they still have a ways to go, he added.

Comcast, the No. 1 U.S. cable operator, said it plans to hire nearly 6,000 new customer service staff and field technicians this year, after hiring around 6,500 in 2006.

The expansion is a drive to keep up with rapid growth. Comcast sold more than 5 million new services to customers last year and expects to sell 6.5 million in 2007.

Time Warner Cable, the second-largest U.S. cable operator, said it is also expanding its customer service, in line with a similar rate of growth in products being sold to customers.

Annual surveys by J.D. Power and Associates show satellite TV service providers DirecTV Group Inc. (DTV) and EchoStar Communications Corp. (DISH) have a significant lead over cable providers in overall customer satisfaction.

Improving customer service has become increasingly important for cable operators as phone rivals Verizon Communications Inc. (VZ) and AT&T Inc. (T) have become more aggressive in trying to win over TV customers.

AT&T's new chief executive, Randall Stephenson, said he hopes to improve service over time. "Right now the installation time line is very similar to the cable experience," he told Reuters in a recent interview. "All of our technicians are brand new hires, so they're going up the learning curve."

Publicly, cable companies say customer service has moved higher on their agenda. For example, Comcast and Time Warner Cable say they have cut things like all-day appointment windows to an average of between two and four hours.

But privately, cable operators say customer service is a difficult thing to get right because half the challenge is with perception. They say that while 99 percent of customers get serviced without any problems, it is the ones who have a bad experience who call the media or write to their congressmen.

One of the most viewed video clips on YouTube last summer was of a Comcast technician caught sleeping on a customer's couch as he waited more than an hour for his office to verify the installation.

Cable operators are emphasizing new services to help improve their image.

Comcast has introduced a service called "Dynamic Dispatch," which uses mobile devices and GPS systems to enable up-to-the-minute communications between customer centers and technicians.

"Do we want to strive to get better? Absolutely. Are we doing a lot to get better? Absolutely," said Comcast Senior Vice President of Customer Care Suzanne Keenan.

As for Time Warner Cable, it offers a Call-To-Meet service in most of its regions: A customer receives a call when a technician is en route, reducing the time customers waste waiting at home.

"I would say that over time we have continued to put increasing emphasis on customer care," said Tom Kinney, senior vice president corporate customer care at Time Warner Cable.