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[qi:086] Want proof that competition will drive faster broadband speeds and lower prices? Try to negotiate a rate cut for your services, and learn for yourself why a duopoly won’t cut it when it comes to improving our nation’s broadband access, especially when providers can also […]

[qi:086] Want proof that competition will drive faster broadband speeds and lower prices? Try to negotiate a rate cut for your services, and learn for yourself why a duopoly won’t cut it when it comes to improving our nation’s broadband access, especially when providers can also cherry-pick where they roll out services.

Back in December, Alan Weinkrantz, a loyal reader of this blog, emailed to let me know he managed to get his AT&T bill practically cut in half by simply calling them up and threatening to take his business elsewhere. So in the spirit of saving money, I tried it myself. Time Warner Cable, my cable provider, basically laughed and told me to go ahead with AT&T’s plain DSL service offered in my area.

His plan didn’t work for me because I live in an area where there’s no comparable service, such as AT&T’s triple play U-verse offering, to switch to. My threats to drop my 7 Mbps downlink service for an AT&T DSL connection rang pretty hollow. Plus, I would then have to go to satellite for cable if I dropped Time Warner completely. Time Warner (was that a snicker I heard?) asked if I’d like to move to a lower tier instead.

Today the Wall Street Journal picked up Alan’s story (Go Alan!), as well as those of some other customers who were able to cut their bills as well. What the article doesn’t mention is that those customers likely had a decent alternative available when they planned their switch, or were willing to sacrifice speed for savings. So for those hoping to negotiate a cut in your comms bills, let me know how it goes. I’d like to know if you managed a discount, and whether or not there are credible alternatives to the service you currently use. My hunch is that only competition yields cost cuts, and folks stuck in the backwoods with no alternative but plain old DSL are hosed.

  1. 100% correct Om. Maybe I wasn’t convincing enough but TW wouldn’t budge, knowing I’m sure that I had no leverage or alternative.

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  2. If you really want the deal in those “less competitive” areas, you don’t ask for a lower price. I’ve been doing the following for 4 years now, giving me the highest speed broadband for $29.99/month (vs the $59.99 or whatever it is supposed to be):

    1) I call the “retention queue” and specifically tell them I’m calling to cancel my broadband.
    2) They generally ask why, at which point I tell them it’s because I’m switching to DSL and don’t need them anymore.
    3) At that point, I almost automatically get offered the lowest tier at a discount – which I reject and say I’d need a better deal, since I’ve already ordered the DSL and would have to cancel it.
    4) They usually come back with a 6 or 12 month special deal for the high-tier or some in between offer that requires a bit more conversation.

    You do have to be prepared to walk – but since they don’t cancel until the end of your billing period, if you call early in the billing period, you have some time.

    Having said all of that, I keep my phone, cable, and directv completely separate, which actually seems to be giving me more leverage at getting a lower price for each of them.

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  3. I tried the same thing with TW here in Manhattan, and in response they offered me a slightly discounted rate if I would lock in for two years. FIOS is coming to Manhattan, and when it does, TW is going to have to work to keep it’s subscribers.

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  4. Well for me it is easy.

    I decided that I really didn’t need TV at all. I have better things to do with my time. The TV shows that are any good end up on DVD. Using Netflix I just spend a weekend on a marathon viewing session and then spend the rest of my life doing something better.

    As far as phone service goes, my wife and I are about ready to cut the landline connection.

    That leaves internet — well Red Rock Coffeehouse in Mountain View is pretty excellent. And lots of socializing possibilities. Considering our internet has been down for a week now (thanks Earthshit (Earthlink) ) — we just might cancel it as well.

    A lot of the things you think you “need” — you really don’t.

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  5. Hey Stacey, thanks for the coverage. The idea not only applies to saving money at home, but in your business. I just got AT&T to cut my hosting bill by 50% simply by calling them and asking which plan I was on. THey told me that I was “qualified” to move to a new plan and so… I did.

    I also cut my business land lines and shifted to cell phones.

    Small businesses with 5 people or less can get “family” plans.

    Visit: http://www.3screens.net

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  6. I’ve had Verizon DSL (rated: 3 mbps down/768 kbps up) and Comcast (rated: 6 mbps down/384 kbps up) at the same time (but I have FiOS now). The DSL was ALWAYS hitting about 3 mbps any time of day, any day of the week; Comcast was ALWAYS slower than my DSL from mid-to-late afternoon until late evening. So, I’d take the “half-speed” DSL over cable (for half the price) any day–those “rated” speeds don’t tell the whole story. (Now, FiOS is both faster and cheaper than Comcast in my area.)

    Reliable VoIP (from an independent provider) is cheaper (even free–GrandCentral/Gizmo).

    TV? OTA (digital) & Hulu & many other online sources (free streaming) as well as DVD (rental & on-sale purchases). (Or you could *upgrade* to satellite, usually cheaper for the same channels/packages.) Money & time savings. (I’ll never pay for channels that include commercials.)

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  7. @ Cheapskate – I’ve tried that and they didn’t bite.

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  8. @austinandrew — so cancel cable and discover life without TV.

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  9. Oh please. Moving to save $20 a month (the effective discount you’d achieve through geography) is silly.

    Its true, that you need always to negotiate your rates, at least once a year, and that with only two sellers, you will only achieve so much. But in our neck of the woods, with only two, we always get a discount of about $20 over the regular rates by opting to “cancel” our service. Retention is always willing to help.

    (Our current DSL rate is below $12/month on annual contract, while the standard rate is $25.)

    Time Warner is a cable company, so they’re a little more difficult. They won’t yield much on price, but will give you free bundled upgrades. Since we don’t need their other offerings, our best rate was $19.95 for RR Lite, which looks like its going to $26.95 shortly.

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  10. Hmm.
    Here cable is 6Mpbs down,1Mpbs up for $57.95, or DSL 6Mpbs down, 768kbps up for $35.00.

    If comparable service is a point, “old DSL” has some leverage here one can use to get a deal (e.g, the $34.99 promotional price) from the cableco.

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  11. I have seen this all around the United States. Companies simply lock people in and say tough kaboodles my friend. It’s our way or the highway. I am looking for two things to change this. Broadband wireless and Fiber. Since FIOS came into my neighborhood the adoption rate has been staggering over 60% of former cable subscribers. Why? Cable had us at 5 MB connection for 2 years, FIOS is coming and now it doubles to 10 for the same price. I’m sure they did it out of the goodness of their hearts.

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  12. As a customer service rep for various telecoms it is up to the rep to provide a sensible level of customer service. They are empowered to do the right thing for the customer and company. Thus we are human and if you don’t like one reps answer call back later (a day .. a few days) and see if you get a different answer.

    The following factors, also go into play…
    a) Payment history and amount of years you have had your account with company.
    b) Competition (definite factor) and the fact we gleefully know you cant find better svc/deal; though factor a) overides this
    c) Reps are human and if were hating the repetitious job, the company or having a bad day, your not getting
    anywhere and it’s best to call back.

    On many days factor c) overides a & b…. CALL BACK til your not satisfied, though dont do it excessively. Play the game!

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  13. If I lived alone I would cancel tw cable tv and use a hidef antenna for ota signals. I use tw internet (fastest) but am anxious for the verizon fios to be laid as they have a 20MB down with a 5MB up. Phone that’s easy. MajickJack via any pc with dsl or better ($19.95/yr).

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  14. It also depends onthe carrier you are dealing with, as many are more than happy to exit the residential market segments. A residential customer with say, a $150 / month bill for bundled service, typically cost the company more in customer service costs and slow payment than a small to medium business billing $1000 / month.

    Sometimes going for the “discount” is not the right angle. Chnage the paradigm to getting more value for your money. That may give you more leverage. Tell them you are willing to accept an “upsell” like higher bandwidth, VoIP calling, etc for the same that you pay today.

    If a lower cost is your end game, then I agree about leveraging your competition. In areas with little direct competition, consider mentioning disruptive technologies like “the speed on my air card could satisy my Internet needs” or “I don’t need a land line, I can use my cell”. as with any negotiation, you have to be 100% willing to walk away if you expect to win.

    Last thought, read today an article from Forrester Research that carriers face major customer retention issues this year. I’d bet that customer retention is a high priority from a corporate perspective so go higher up the management heirarchy, as they will most likely be more sensitive to the need to retain. It’s always more costly to acquire or winback a customer than it is to save an existing one.

    -sc

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  15. I had Comcast for a while until AT&T U Verse was available in my area. U verse was offering $200 Cash back, I logged in to their online customer service and said I don’t want to pay for HD TV. Without any hesitation they gave me another $50 cash back and also took $10 off from my total bill. I just had to ask and I just did it online and it worked out.

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  16. After I lost my promotion with TWC because of a non-payment disconnet, I was highly upset. Its fair in that I didn’t pay so disconnect. But I got the money and got caught up and things should proceed as normal right? NO so I looked for a new provider and bless their heart AT&T no longer require me to have a home phone line. So when I called to disconnect they wanted to lower my bill! To late TWC

    Perks:
    Just for switching from cable I get $125 rebate
    $100 rebate for the cost of the modem which equals to free
    PLUS! As a DSL customer I get unlimited access to AT&T Wifi hotspots at any Starbucks. McD’s and some hotel chain! Plus my monthly rate is cheaper by $2 dollars.

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  17. Hi Stacey…. wait there’s more….

    Here is the story about my getting a 40% discount from AT&T on “Good Morning America” which aired on Friday:
    http://abcnews.go.com/Business/Economy/story?id=6715239&page=1

    Yes, it really works.

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  18. TW’s cable is available where I live (I don’t have it. Not much that’s worth watching. Besides Netflix there’s net viewing if i care to watch). However, they can’t do RoadRunner here. Most of the surrounding area is served by Verizon, but I am in a little strip of the map covered by Frontier, who absolutely refuse to offer standalone DSL (I tried, believe me.) But it’s either them or dialup.

    rob martin: The moving comment is tongue in cheek, meant to make a point.

    Sheesh, people take things so literally!

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  19. [...] it comes to broadband, we don’t even know who has access to it or what speeds they have, making it hard to pull the number of potential beneficiaries out of the [...]

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  20. [...] it comes to broadband, we don’t even know who has access to it or what speeds they have, making it hard to pull the number of potential beneficiaries out of the [...]

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  21. [...] it comes to broadband, we don’t even know who has access to it or what speeds they have, making it hard to pull the number of potential beneficiaries out of the [...]

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  22. [...] tiered plans are about limiting competition (especially from online video), and squeezing customers because a lack of competition means they can. Here’s the money quote from the BW article: “We need a viable model to be able to [...]

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  23. [...] plans are about limiting competition (especially from online video), and squeezing customers, because a lack of competition means they can. Here’s the money quote from the BW [...]

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  24. [...] Not much has changed since then, except for the outrage over the TWC caps. This goes to show how important competition is when it comes to getting ISPs to behave in a consumer-friendly [...]

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  25. [...] plans are about limiting competition (especially from online video), and squeezing customers, because a lack of competition means they can. Here’s the money quote from the BW article: “We need a viable model to be able to support the [...]

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  26. [...] help but compare what Verizon is offering to my own package of communications services and see how true broadband competition would benefit [...]

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  27. [...] argued that such caps deter innovation by raising the cost of broadband, and are the result of a lack of real competition in many U.S. broadband markets. Massa’s legislation, known as the Broadband Internet Fairness [...]

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  28. [...] Internet from a direct fiber-optic line” at the next home they buy, the study showed. Although I’m a huge proponent of broadband access, and assume that it would be a critical factor in my choice of home, choosing broadband over [...]

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  29. [...] companies, it’s hard to prove a monopoly situation. (I’m not arguing either of those areas are all that competitive, only that they’re not a monopoly). However, in terms of the agreements between carriers that [...]

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  30. [...] We need laws. Carriers don’t want to share the data because then wed know exactly how uncompetitive the market for broadband is in most areas of the country — and armed with that knowledge, the government may have to [...]

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  31. [...] gathered in Washington, D.C., this morning to debate how the wireline duopoly affects the market for broadband in the U.S. at an open meeting held by the FCC. The majority of the speakers, including representatives from [...]

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  32. [...] doesn’t get spent evenly across the population. Plus, despite that investment, most Americans don’t have a lot of choice about their broadband [...]

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  33. [...] The network can help spur innovation, but could also become a foil to the lobbying efforts from existing ISPs, many of whom are less than up-front about how their network costs are reflected in their prices, and tend to react with hysteria when faced with regulations that will limit their ability to control the bits running over their pipes. We’ve all read stories about how the web will break under the weight of network neutrality, or how the ISPs needs to raise prices or implement tiered pricing plans because some consumers are using too many resources. What we don’t have is the data showing that there’s an economic reason for this other than profiteering in an uncompetitive market. [...]

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  34. [...] The network can help spur innovation, but could also become a foil to the lobbying efforts from existing ISPs, many of whom are less than up-front about how their network costs are reflected in their prices, and tend to react with hysteria when faced with regulations that will limit their ability to control the bits running over their pipes. We’ve all read stories about how the web will break under the weight of network neutrality, or how the ISPs needs to raise prices or implement tiered pricing plans because some consumers are using too many resources. What we don’t have is the data showing that there’s an economic reason for this other than profiteering in an uncompetitive market. [...]

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  35. [...] access to their infrastructure (others have called for similar programs in the U.S., which has its own competition problems).  The document prompted a kind of call to arms from The Globe and Mail, which this morning called [...]

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  36. [...] I also wish that instead of focusing on things it can’t control, the FCC comes up with a solid plan to address competition in wired and wireline, so that a competitive market can do what the FCC cannot. : AAPL, Apple, [...]

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  37. [...] amount of lawful Internet content, applications and services.” Internet access and the lack of competition is a profoundly local issue in many areas – something that ISPs continually try to gloss over (try to catch Verizon [...]

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