Cable Firms Still Coping With Disgruntled Customers

While cable and telecom companies rush to deploy broadband services to
bandwidth hungry consumers, cable firms are discovering that customer
service relationships are more intimate and immediate than their cable
television clients demand.

One area where cable firms are battling to stay up to speede is North Texas which is experiencing great growth in the demand of high-speed Internet services for
both home and business use.

Prioritizing customer service at telephone companies is nothing new for the
firms that have been providing basic phone services to homes and businesses
for decades. Because the cable minimizes its customer approach while
telecom companies provide personal contact, cable modem connectivity may be
popular now, but telecom companies and Internet service providers are on
delivering high-speed Internet access that meet customer’s service

Software developer Randy Dryburgh operates Calista Technologies out of his home
office in North Texas on eight networked computers joined to the Internet
through AT&T@Home cable

When Dryburgh’s cable modem access goes down, so does his business and the
lack of broadband competition in North Texas means that AT&T@Home, a
division of AT&T
spokesperson, said Dryburgh’s claims were completely unfounded.

“We serve 37 communities in North Texas and his claims are unfounded,”
Biasatti said. “We are up right now, but we did have periodic downtime last
week when technicians replaced a server. Everything is up and the e-mail
problem is resolved.”

Biasatti added that all cable companies in the area were experiencing the
same problem, including
Cox Communications,
But Cox could not confirm any regional cable
service issues.

AT&T delivers cable broadband services to the region through its
partnership with Excite@Home. Allison
Bowman, Excite@Home spokesperson, said the network did
have some issues last week but that there were no outstanding service
tickets in Texas at this time.

“Last week we had a server issue and we called in the manufacturer to
replace it,” Bowman said. “It was not an e-mail server though, it happened
early last week and all service issues were resolved by Wednesday.”

Dryburgh said he understands that cable access is not perfect, but the
customer runaround he gets when reporting downtime is motivation enough to
make him to want to switch broadband providers.

“I spent four hours total on the phone and not one customer service
representative or technician has ever returned my call,” Dryburgh said.
“I’ve had AT&T@Home service at two different locations after moving from an
apartment to my home. It’s not the downtime that aggravates me, but the
runaround I get when I’m trying to get a credit for downtime and have to
face AT&T’s ‘prove it’ challenges. I’m switching as soon as I can get DSL

GTE Corp. is working to deploy digital
subscriber line services to the North Texas region. While SBC Communications, Inc.

livers telecom and Internet service in Dallas, much of the surrounding
suburbs are served by GTE and GTE Internet.

Bill Kula, GTE spokesman, said he lives in Plano and is quite familiar with
customer demands for high-quality broadband services to the area.

“In 1970 Plano consisted of 17,000 people, cotton fields and rabbits,” Kula
said. “Thirty years later, Plano is a thriving city with 230,000 people and
no more room to grow. I’m 13,900 feet away from a GTE Central Office and I
have DSL service to my home. We can provision DSL services to 60 percent of
North Texas, but ISDN is an interim solution for residents of North Texas
that demand speed and quality customer service in the area.”

Kula added that GTE is working to deploy additional DSL lines in Texas, and
throughout the nation.

“By 2003 we hope to be on target to provide 80 to 85 percent of our service
area with DSL access,” Kula said. “Right now in Texas we serve
approximately 2,000 customers with DSL access and have provisioned 650 CO’s
nationwide to serve a total of 7.5 million DSL customers over 11 million
DSL-capable copper feeds.”

According to independent research company the Yankee Group, cable industry
consolidation and competition from local telephone companies will drive the
U.S. market for residential high-speed Internet services to 3.3 million
subscribers this year, and will reach 16.6 million subscribers by 2004.

According to the Yankee Group report, the installed base of domestic
high-speed Internet subscribers stood at 1.4 million at the end of 1999,
with nearly 80 percent of these homes using cable modems for access.

While the cable industry continues to lead the market over the next five
years, its share of the total installed base of broadband subscribers will
shrink to about 58 percent by the end of 2004 as local telcos make DSL
services more widely available and splitterless DSL modems make it easier
for consumers to self-install connectivity.

Kula said GTE’s DSL program for home use is very popular among its
subscriber base.

“Right now more than 80 percent of our DSL orders are self-installed,” Kula
said. “Most of these connections from GTE or its 349 ISP resellers offering
DSL services waive set up fees and offer the modem for free to consumers.”

According to Bruce Leichtman, director of the Yankee Group’s Media &
Entertainment Strategies practice, recent consolidation among large and
mid-sized cable system operators will speed deployment of cable modem

“Prior to consolidation, the high cost of upgrading to two-way,
cable-modem-capable infrastructure meant that smaller operators would be
hard-pressed to make the transition quickly,” Leichtman said.

On the DSL side, Leichtman believes that wider deployment and more
consumer-friendly pricing options will make the telco-delivered technology
more widely accepted in the next few years.

“Consumer data gathered for the report indicates that among consumers who
were interested in receiving high-speed access, 30 percent said they would
prefer to receive the service from their telephone company, while 20
percent favored their cable provider,” Leichtman said. “Significantly, the
remaining 50 percent said they still had no preference.”

No preference means that customer service and connectivity are tantamount
to keeping high-speed customers from switching services as cable and DSL
access goes head-to-head in more and more U.S. cities.

Leichtman said connectivity is a high-speed customer’s first priority.

“Connectivity is number one, while speed, price and security round out the
top four priorities for broadband users,” Leichtman said. “Subscribers
won’t accept connectivity without customer service, the two must go
hand-in-hand to keep

customers from switching services.”

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