Comcast Customer Satisfaction Increases Amid Phone, Satellite Competition

Comcast Corp., the U.S. cable company that has been criticized for its customer service, has improved its service each year since 2008 as competition among industry providers has stiffened, a survey showed.

The American Customer Satisfaction Index, which tracks more than 200 U.S. companies, said Comcast’s score climbed 3.4 percent from a year earlier, while shopper attitudes toward all cable and satellite-TV providers rose to the highest level in a decade. The higher scores stemmed from efforts to gain a competitive edge through better interaction with subscribers, according to the survey’s publisher.

“As the phone companies have entered into the pay-TV market, there’s been more consumer choice, more competition, and as a result, better deals and a focus on customer service,” said Claes Fornell, a marketing professor at the University of Michigan in Ann Arbor, who oversees the index. “The cable industry’s ramping up its focus on customer service because they have to in order to stay in business and be competitive.”

Comcast’s push to improve began about two years ago when the company’s weaknesses were highlighted through Internet sites such as Comcastmustdie.com and the Consumerist, a website owned by Consumers Union, publisher of Consumer Reports magazine.

Losing Subscribers

Comcast lost 623,000 video subscribers in 2009, largely because it and other cable operators “lost focus” on their core customers, said Jason Bazinet, an analyst at Citigroup Inc. in New York.

“Cable companies shouldn’t be losing basic subscribers to satellite or phone competitors,” Bazinet said at a cable- industry conference in Los Angeles last week. Cable companies need to maintain healthy relationships with their customers to avoid losing them to the competition and to improve the industry’s overall negative perception, which may be a drag on valuation, he said.

“Millions of people buy our products, and many are satisfied, but one bad event gets a lot of publicity,” said Brian Roberts, Comcast’s chief executive officer, at the industry conference. “We’ve had a real problem with image and customer service.” Verizon Communications Inc.’s FiOS-TV customer service topped the survey, followed by AT&T Inc.’s U-verse TV product. Satellite operators Dish Network Corp. and DirecTV chased the phone companies, while still beating all of the cable operators, including Comcast.

Comcast has the largest U.S. customer base, dwarfing both Verizon and AT&T’s TV-product, which combined have less than a quarter of Comcast’s subscribers. Comcast’s 13 percent gain in the survey since 2008 is the largest among pay-TV providers tracked during the period.

High Scorer

Cox Communications Inc. scored highest among the four largest cable companies, followed by Comcast, Time Warner Cable Inc. and Charter Communications Inc., according to the survey.

Comcast has invested about $2 billion over the last two years to improve its interaction with customers, said Jenni Moyer, a spokeswoman with the company.

“We realize this isn’t a sprint, it’s a marathon,” said Tina Waters, a Comcast senior vice president. “There is no real end for this marathon because we know that our subscribers deserve superior customer service and we continue to invest in the tools, the people and the process to make that happen.”

The index was developed by the National Quality Research Center at the University of Michigan’s Stephen M. Ross Business School.

To contact the reporter on this story: Kelly Riddell in Washington at Kriddell1@Bloomberg.net

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