J.D. Power and Associates Reports: Bundling Video With Voice and Data Services Gives Cable Companies a Competitive Edge Over Telephone Providers

J.D. Power and Associates Reports: Bundling Video With Voice and Data Services Gives Cable Companies a Competitive Edge Over Telephone Providers

Bright House Networks, Cablevision, Cox Communications and WideOpenWest! Top Regional Customer Satisfaction Rankings for Residential Telephone Service

WESTLAKE VILLAGE, Calif., July 11 /PRNewswire/ -- Cable companies, which lead the customer satisfaction rankings for telephone service in all six U.S. regions for the first time, are proving to be tough competition for traditional telephone providers, as the impact of bundled service packages steadily reshapes the telecommunications market, according to the J.D. Power and Associates 2007 Residential Regional Telephone Customer Satisfaction Study(SM) released today.

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The study measures customer satisfaction with both local and long distance telephone service in six regions across the United States. Six factors are examined in determining overall satisfaction. In order of importance, they are: performance and reliability, customer service, billing, image, cost of service, and offerings and promotions.

The study finds that 86 percent of cable-based voice subscribers also subscribe to data services from the same provider -- up from 71 percent in 2006. Conversely, 36 percent of telecommunications-based voice subscribers also use their provider to fulfill their data needs, which is an increase of 7 percentage points over 2006. The impact of bundling is further evidenced by the boost in importance weight of the offerings and promotions factor, which has increased by 3 percent since the 2006 study.

"Customers increasingly want multiple services and products bundled into one convenient package under a single provider, and cable companies are doing a great job of achieving this with their voice, data and video packages," said Steve Kirkeby, executive director of telecommunications and technology research at J.D. Power and Associates. "Even still, local and long-distance phone services remain the most widely accepted services to bundle, with data and video steadily closing the gap over the past three years. While rolling out their video service offerings, telephone companies can improve their near-term competitiveness by either lowering prices on their core products or perhaps even adding wireless service to their bundle options, as some have already done."

The study also finds that 43 percent of customers report that they are loyal to their voice provider -- an increase from 41 percent in 2006. However, among the 12 percent of subscribers who "definitely" or "probably" intend to switch providers, the most frequently cited reasons for doing so include competitive/discounted pricing, convenience and receiving a single bill.

"It seems as though most subscribers are becoming more loyal, with 36 percent of those who currently bundle reporting they would add even more products or services from their current provider, making the next several years crucial for both telephone and cable companies," said Kirkeby. "Increased loyalty and the relatively stable switching intentions observed over the past few years will make it increasingly difficult to gain market share through product offerings alone."

The study examines wired telephone service provider performance in six geographic regions. The study results by region are:

Northeast Region: Cox Communications ranks highest in the region for a second consecutive year, receiving the highest ratings from customers in performance and reliability, billing, image and customer service.

Mid-Atlantic Region: Included in the study for the first time in 2007, Cablevision ranks highest, performing particularly well in all six factors of overall satisfaction.

Southeast Region: Bright House Networks ranks highest in the region for a second consecutive year, performing particularly well in customer service, billing, image, cost of service, and offerings and promotions.

North Central Region: Included in the study for the first time in 2007, WideOpenWest (WOW!) leads the region, receiving highest ratings from customers in all six factors of overall satisfaction.

Southwest Region: Cox Communications ranks highest for a second consecutive year, receiving particularly high ratings in all factors of overall satisfaction.

West Region: For a fifth consecutive year, Cox Communications ranks highest in the region, performing particularly well in billing, image, and performance and reliability.

The 2007 Residential Regional Telephone Customer Satisfaction Study is based on responses collected from April to May 2007 from 11,911 customers nationwide who receive their local and long distance telephone service from one provider.

   Northeast Region   (Based on a 1,000-point scale)    Cox Communications              717   Time Warner Cable               698   Cablevision                     683   Northeast Region Average        665   AT&T                            660   Verizon                         659   Comcast                         641    NOTE: The Northeast region includes Connecticut, Massachusetts, Maine, New         Hampshire, New York, Rhode Island and Vermont.      Mid-Atlantic Region   (Based on a 1,000-point scale)    Cablevision                     711   Cox Communications              686   AT&T                            664   Verizon                         656   Mid-Atlantic Region Average     655   Comcast                         637   Embarq                          611    NOTE: The Mid-Atlantic region includes Washington, D.C., Delaware,         Maryland, New Jersey, Pennsylvania, Virginia and West Virginia.      Southeast Region   (Based on a 1,000-point scale)    Bright House Networks           713   Time Warner Cable               704   AT&T                            670   Windstream                      666   Southeast Region Average        664   Verizon                         661   Embarq                          615   Comcast                         601    NOTE: The Southeast region includes Alabama, Florida, Georgia, Kentucky,         Louisiana, Mississippi, North Carolina, South Carolina and Tennessee.      North Central Region   (Based on a 1,000-point scale)    WOW!                            751   Cincinnati Bell                 704   Time Warner Cable               661   AT&T                            650   North Central Region Average    649   Verizon                         644   Comcast                         624   Charter                         609   Embarq                          595    NOTE: The North Central region includes Illinois, Indiana, Michigan, Ohio         and Wisconsin.      Southwest Region   (Based on a 1,000-point scale)    Cox Communications              703   AT&T                            679   Time Warner Cable               669   Southwest Region Average        669   Verizon                         636   Embarq                          571    NOTE: The Southwest region includes Arkansas, Kansas, Missouri, Oklahoma         and Texas.      West Region   (Based on a 1,000-point scale)    Cox Communications              691   Comcast                         685   Verizon                         664   Qwest                           663   West Region Average             661   AT&T                            651   Embarq                          620    NOTE: The West region includes Arizona, California, Colorado, Iowa, Idaho,         Minnesota, Montana, North Dakota, Nebraska, New Mexico, Nevada,         Oregon, South Dakota, Utah, Washington and Wyoming.      About J.D. Power and Associates  

Headquartered in Westlake Village, Calif., J.D. Power and Associates is an ISO 9001-registered global marketing information services firm operating in key business sectors including market research, forecasting, performance improvement, training and customer satisfaction. The firm's quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

Founded in 1888, The McGraw-Hill Companies (NYSE:MHP) is a leading global information services provider meeting worldwide needs in the financial services, education and business information markets through leading brands such as Standard & Poor's, McGraw-Hill Education, BusinessWeek and J.D. Power and Associates. The Corporation has more than 280 offices in 40 countries. Sales in 2006 were $6.3 billion. Additional information is available at http://www.mcgraw-hill.com/.

   Media Relations Contacts:   Syvetril Perryman                  Jeff Perlman   J.D. Power and Associates          Brandware Public Relations   Westlake Village, Calif.           Westlake Village, Calif.   (805) 418-8103                     (805) 494-5113   syvetril.perryman@jdpa.com         jperlman@brandwaregroup.com   

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Source: J.D. Power and Associates

CONTACT: Syvetril Perryman of J.D. Power and Associates, +1-805-418-8103,
syvetril.perryman@jdpa.com, Jeff Perlman of Brandware Public Relations,
+1-805-494-5113, jperlman@brandwaregroup.com, for J.D. Power and Associates

Web site: http://www.jdpower.com/

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