DBS Customers Happier Than Cable Users8/24/2003 08:00:00 PM Eastern
Video customers are much more satisfied with DirecTV and EchoStar than they are with cable and give DBS much higher marks than they give cable operators. And their video bills are lower.
That's the conclusion of an annual customer-satisfaction survey by J.D. Power and Associates, well-known for measuring customer satisfaction in a variety of consumer products and services from cars to PCs. DBS won the satisfaction derby last year, too.
J.D. Power asked 7,340 cable or DBS subscribers about their happiness with their provider's performance and reliability, cost of service, billing, and programming packages. The firm syndicates the research and tries to coax top-rated companies into paying to promote their results.
The study ranked DirecTV highest, with an index of 118 (the index relates to how each of the 13 providers fared). EchoStar wasn't far behind with a 116, a gap considered statistically insignificant.
Cable operators' performance was markedly lower. Cox was the highest-ranking of them with 110. Overbuilders WideOpen West (108) and RCN (105) scored well, probably in part because all of their systems have been built relatively recently and in part because they face heavy competition in all of their markets. Other cable operators generally don't face wired-cable competition (though all cable companies fight DBS).
The survey gave low scores to Comcast (90), Cablevision (89) and bankrupt Adelphia (87, down 11 points from last year's survey).
The study also found that, for the first time, cable customers' average bills are higher than those of DBS subscribers: $49.62 for cable vs. $48.93 for DBS. That's only partly due to rising cable prices. Mostly, it's from purchases of new services like digital TV, video-on-demand and high-definition TV (it excludes high-speed data and telephone services).
DirecTV Executive Vice President of Customer Satisfaction Bob Meyers said customers are getting happier as the service adds more product, particularly signals from local broadcast stations, or local-into-local. But keeping customers happy is increasingly challenging, partly because their expectations keep rising. Also figuring into the equation are new features DirecTV offers, such as digital video recorders integrated into DirecTV receivers. "That adds some complexity," Meyers said.
One cable company that showed strong improvement was CableOne, the Washington Post Co.'s cable unit, whose 105 score was much higher than last year's 94. But CEO Tom Might discounted the shift, saying that CableOne's performance in the J.D. Power study has gyrated over the past few years. The company's internal research (soliciting 1,000 subscribers monthly) shows customer satisfaction has been improving but with fewer fluctuations than the Power survey indicates.
"We did no video rate increases this year," Might said. "Our internal research shows that price has become a much more important factor in customer satisfaction and loyalty."
|The two DBS companies far outpace most cable rivals when it comes to keeping customers happy, according to research group J.D. Power and Associates|
|*Based on an average of 100 points; only a gap of 5 points or more is considered statistically significant.
Source: J.D. Power and Associates