OPTing In – The OnProcess Technology Blog

If you only glanced at the headline from the 2009 J.D. Power and Associates TV service satisfaction survey (see Satellite, Telcos Beat Cable On TV Satisfaction: J.D. Power) you may have missed a key point: Cable customers are happier than they were a year ago.

In fact, cable operators made gains virtually across the board, in each of the four regions measured on J.D. Power’s survey (see table, below).

The problem is, telcos and satellite operators raised the bar, too (with the single exception of AT&T U-verse in the North Central region, where it dropped 15 points vs. 2008 but still placed second behind WOW). Average satisfaction nationwide in 2009, across all TV service providers, was 632 on the 1,000-point scale — up 23 points from 609 last year.

As a result, the relative standings didn’t really change. It’s a “frustrating” situation, one cable executive told me, given the time and effort they’ve spent on this issue.

So the question is, why did nearly all the providers boost their satisfaction scores?

Frank Perazzini, J.D. Power’s director of telecommunications, suggested that after the poor showing in 2008 — the lowest overall scores for pay TV providers in five years — everyone redoubled their efforts “to better position themselves to retain and grow their customer bases.” Fewer TV customers reported outages on the 2009 survey (11% vs. 15% in 2008), and the industry cut time on hold to resolve a customer’s issue by 13% year over year.

Another factor that has surely moved the needle: There’s more competition. With as many as four (or even five) providers in some markets, there’s been a surge of special promotions, pricing deals, expanded HD lineups, more VOD, etc. How could such lagniappes, in tandem with other service improvements, not make you happier?

But try as it might, cable hasn’t won bragging rights on J.D. Power’s TV survey in the last three years (with the exception of overbuilder WideOpenWest), although MSOs like Cox, Cablevision and Insight have performed relatively well.

Is cable really just inferior to the competition? Or do the differences stem from lingering resentment about “the cable company” being the only game in town? Maybe U-verse TV, say, seems better because it’s a clean sheet of paper — and you’re inclined to be happy with the “alternative to cable” because you opted to switch in the first place.

Whatever the reason, cable providers will have to push even harder on the happiness levers, if they want to gain any ground.

OnProcess’ Take:
Now, more than ever, competition and success in the Pay TV market will be based on customers’ perceptions of service, as opposed to price. Understanding what levers to pull to most beneficially affect Customer Satisfaction levels has to be a key factor in achieving this goal. Do Pay TV and Cable MSOs have methodologies and data-driven insights in place to enable this kind of improvement?

–sk