Comcast Opens Door for Competitor
Not long ago in this space, I posted on Comcast’s rapidly declining customer-service reputation. Since that time, I’ve heard from Comcast users who have their own unhappy stories to tell. Now comes news of a California man who is threatening a lawsuit, claiming that Comcast pressured his employer to fire him because of a lengthy billing dispute.
I have no idea whether the complaint has merit, although Comcast has posted an apology to him on its website. Still, the outcome is hardly the point. The problem is that Comcast just keeps taking public-relations hits. The question is why.
One body of thought holds that Comcast’s spate of bad press represents fallout from its proposed $45 billion merger with Time Warner Cable. And the fallout has been considerable. Many thoughtful observers are worried about increasing concentration in the cable industry, and regulatory approval is far from certain. The deal is facing a lot of opposition from content providers, competitors and activist groups. Some localities are suggesting they might refuse to go along with the merger -- cable lines lie beneath local streets -- unless they get certain promises and guarantees. Even the Writers Guild of America, West, has gotten into the act, opposing the merger on the ground that the resulting behemoth will be able to call the shots in the video programming market.
Many of the merger’s critics are seeking various guarantees or discounts. The company, which has called the threats “extortionate,” contends that its opponents are asking for some $5 billion in goodies. Huffed Holman Jenkins in the Wall Street Journal, “It’s a sad thing when a government process lends itself to such shakedowns, but also routine.”
It’s true that abusing regulatory processes for rent-seeking is both routine and wrong. It’s also true that if Comcast starts distributing goodies to its critics, more will doubtless line up with their hands out.
On the other hand, the company’s image problem is real, and just getting bigger won’t make the issue go away. In last December’s American Consumer Satisfaction Index, Comcast’s Internet service was third from the bottom -- not for Internet service but for anything. Writes Business Insider: “Comcast has the dubious distinction of being the lowest-rated company in the lowest-rated industry.” Ranked just below? You guessed it: Time Warner Cable.
Small surprise, then, that the New York Public Service Commission has delayed its vote on the merger until November, in part to gather more information about supposed deficiencies in customer service. When you can’t figure out how to keep your customers happy, there are consequences. A columnist in the International Business Times put the matter bluntly: “Can Comcast and Time Warner Cable improve their notoriously subpar customer service? And if the two companies merge, will it only get worse?”
One thing seems sure. Whatever one’s view on the merger, it’s simply not true, as a Democratic Representative Tony Cardenas recently complained, that the size and power of Comcast has a “chilling effect” on would-be opponents. Quite the contrary.
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