The War With No Winner

by George Simpson, Mar 20, 2006, 6:00 AM

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War has broken out in New Jersey. It doesn't involve mis-checked SAT scores or Tony Soprano, the state's only other notable industry. Well, maybe it does involve Tony just a shade. Verizon Communications is blasting cable companies for refusing to air its ads that criticize soaring cable prices. (Verizon's commercial states that cable rates have risen 86 percent because consumers have no choice of cable providers.) Meanwhile, Comcast and Time Warner have been running ads "virtually nonstop" attacking Verizon's effort to offer New Jersey consumers a competing slate of TV entertainment.

This is just an opening salvo in what promises to be a highly entertaining war between cable companies and telecoms, as both seek to be the one to provide households with a bundle of services that include local, long distance, Internet, and TV. And it's one of those wars that consumers hope bogs down into Flanders-like trench warfare, where no one wins and both sides just beat the crap out of each other for years to come. Why? Because everybody hates both their phone company and their cable company.

We all grew up with AT&T. We hated that it had a stranglehold on local and long distance and had little trouble getting rate increases past regulatory bodies at every level of government. AT&T changed for everything--from installing $15 jacks that cost them about a nickel, to charging big bucks to "turn on the service"--which meant someone, somewhere, pressed a button. Once on a business trip I was playing a game with then-Newsweek Washington Bureau Chief Mel Elfin, coming up with great ways to stop conversations at a cocktail party. He won with, "I work for the phone company."

But worse was yet to come. Cable companies were started by guys who were good at digging ditches to lay lines in and stringing cable between poles. They knew nothing about marketing or customer service. Yet they were granted monopolies by town fathers who felt empowered they could someday "revoke" the license. Ha! Hasn't happened yet that I know of. The first five to seven service calls were by guys who knew less about cable than you did, and it took forever to get correctly connected, especially in big cities. When they started offering Internet service, they deployed service reps who were so stupid and inept, you were lucky if they left your house without having broken something important.

Once cable worked--never a certainty in those early days--the rate increases and service outages started. It was easier to find the opt-out option on a WhenU ad than get a service rep on the phone who could do anything other than say: "Hold on, I'll see if I can find my supervisor."

It didn't take long for people to hate their cable company even more than their phone company (whichever piece of the baby Bells they happened to inherit.)

So now we don't know whom we should cheer for. If the telcos win, will that drive down the cable costs to something remotely reasonable? If cable wins, does that mean we don't get the cool multi-platform access to TV they could offer? Doesn't matter who wins, really, because they are both losers already. They became losers when they became monopolistic and cheaped out on customer service, sent monthly invoices with bogus charges polished to look like federally mandated costs, and raised rates figuring, so, where else can you go?

The consumer has an answer: you can both go to hell.

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