J.D. Power and Associates Reports: Cable Companies Dominate Customer Satisfaction Rankings for Local and Long Distance Telephone Service

J.D. Power and Associates Reports: Cable Companies Dominate Customer Satisfaction Rankings for Local and Long Distance Telephone Service

Cox Communications Ranks Highest in Three Regions, While Bright House Networks, Time Warner Cable and Verizon Each Rank Highest in One Region

WESTLAKE VILLAGE, Calif., July 12 /PRNewswire/ -- As cable companies aggressively entice telephone customers with attractively priced service bundles, many are also outperforming traditional telephone companies in satisfying customers, according to the J.D. Power and Associates 2006 Residential All-Distance Telephone Customer Satisfaction Study(SM) released today.

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The study, which measures customer satisfaction with both local and long distance telephone service, finds that cable companies rank highest in customer satisfaction in five of six U.S. regions. In 2005, just one cable company -- Cox -- led any of the regional customer satisfaction rankings. Cox Communications now ranks highest in three regions, while newcomers Bright House Networks and Time Warner Cable each rank highest in one region. Verizon is the sole traditional telephone company ranking highest in a region.

"While telephone service offered by cable companies is relatively new to the market, large numbers of customers are being lured to switch with enticing cost savings and highly attractive bundles of video, voice and data service," said Steve Kirkeby, executive director of telecommunications and technology research at J.D. Power and Associates. "The importance of pricing as a reason to bundle service with a single provider has increased dramatically this year, no doubt a result of significant price competition introduced when cable companies began offering local and long distance telephone service to new markets."

Although price competition plays a significant role in the industry today, customer-reported spending on local and long distance service has increased 3.4 percent from 2005. On average, customers report paying $52.40 per month for local and long distance service -- up from $50.70 in 2005. Customers of cable providers report paying an average of just $42.40 per month, while reported spending with traditional telephone companies averages $53.59.

"We're seeing that for the first time customers are most often contacting their all-distance carrier about rates, pricing and features while questions about billing have dropped dramatically, spotlighting how intense competition and simplified rates are changing customer focus," said Kirkeby. "However, the study findings consistently indicate that price alone will not satisfy or retain customers."

The study finds customer satisfaction in the telephone industry continues to decline. Overall, satisfaction index scores have dropped from 692 (on a 1,000-point scale) in 2005 to 670 in 2006. Satisfaction has fallen in all six factor areas measured in the study, dropping most significantly in the areas of customer service, image and billing. The other areas measured are performance and reliability, cost of service, and offerings and promotions.

"Although cable companies entering new markets average satisfaction scores that are more than 30 index points higher than the industry as a whole, and despite nearly doubling their share to just under 10 percent of the telephone service market, cable companies are not yet a large enough force to propel overall satisfaction higher," said Kirkeby. "Overall satisfaction drops as the industry continues to struggle with consumer uncertainty caused by several large, well-publicized mergers and divestitures among the traditional phone companies. Changes such as these always take their toll on customer satisfaction."

The study results by region are:

Northeast Region: Cox Communications ranks highest, receiving the highest
ratings in the region in performance and reliability, billing, image,
customer service, and offering and promotions.

Mid-Atlantic Region: Verizon ranks highest, outperforming other carriers
in billing, image, cost of service, and offerings and promotions.

Southeast Region: Bright House Networks ranks highest, with top ratings in
the region in customer service, billing and image.

North Central Region: Time Warner Cable ranks highest, with the highest
ratings in the billing and cost of service factors.

Southwest Region: Cox Communications ranks highest, with particularly high
ratings in customer service, billing and image.

West Region: Cox Communications ranks highest in the region for a fourth
consecutive year, receiving top ratings in all six factors.

The 2006 Residential All-Distance Telephone Customer Satisfaction Study is based on responses from 12,196 customers nationwide who receive their local and long distance telephone service from one provider.

Customer Satisfaction Index Scores
(Based on a 1,000-point scale)

Northeast Region
(Includes Connecticut, Massachusetts, Maine, New Hampshire, New York,
Rhode Island and Vermont)

Cox Communications 748
Time Warner Cable 713
Cablevision 675
Verizon 667
Northeast Region Average 667
Frontier 658
AT&T 656
Comcast 616

Mid-Atlantic Region
(Includes Washington, D.C., Delaware, Maryland, New Jersey, Pennsylvania,
Virginia and West Virginia)

Verizon 679
Mid-Atlantic Region Average 671
AT&T 666
Cox Communications 662
Comcast 632
Sprint 597

Southeast Region
(Includes Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi,
North Carolina, South Carolina and Tennessee)

Bright House Networks 723
Time Warner Cable 711
BellSouth 702
Southeast Region Average 684
Cincinnati Bell 680
Verizon 669
AT&T 656
ALLTEL 653
Sprint 645

North Central Region
(Includes Illinois, Indiana, Michigan, Ohio and Wisconsin)

Time Warner Cable 713
Cincinnati Bell 709
TDS 708
Talk America 685
Verizon 660
North Central Region Average 654
AT&T 646
Comcast 640
Sprint 636
CenturyTel 611

Southwest Region
(Includes Arkansas, Kansas, Missouri, Oklahoma and Texas)

Cox Communications 707
Time Warner Cable 698
AT&T 683
Southwest Region Average 671
Verizon 637
ALLTEL 634
CenturyTel 619
Sprint 610

West Region
(Includes Arizona, California, Colorado, Iowa, Idaho, Minnesota, Montana,
North Dakota, Nebraska, New Mexico, Nevada, Oregon, South Dakota, Utah,
Washington and Wyoming)

Cox Communications 730
Verizon 691
West Region Average 675
Qwest 673
AT&T 665
Comcast 663
Frontier 623
Sprint 618

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, consulting, training and customer satisfaction. The firm's quality and satisfaction measurements are based on responses from millions of consumers annually. 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 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 290 offices in 38 countries. Sales in 2005 were $6.0 billion. Additional information is available at http://www.mcgraw-hill.com/.

Media Relations Contacts:
Karla Tucker Syvetril Perryman
J.D. Power and Associates J.D. Power and Associates
Troy, Mich. Westlake Village, Calif.
(248) 312-4344 (805) 418-8103
Karla.tucker@jdpa.comsyvetril.perryman@jdpa.com

Gibson Patterson
JMPR Public Relations
Woodland Hills, Calif.
(818) 992-4353/cell: (310) 722-6060
gpatterson@jmprpublicrelations.com

No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power and Associates. www.jdpower.com/corporate

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PRN Photo Desk, photodesk@prnewswire.com
Source: J.D. Power and Associates

CONTACT: Karla Tucker, Troy, Mich., +1-248-312-4344,
Karla.tucker@jdpa.com, or Syvetril Perryman, Westlake Village, Calif.,
+1-805-418-8103, syvetril.perryman@jdpa.com, both of J.D. Power and
Associates; or Gibson Patterson, Woodland Hills, Calif. of JMPR Public
Relations, +1-818-992-4353, or mobile, +1-310-722-6060,
gpatterson@jmprpublicrelations.com, for J.D. Power and Associates

Web site: http://www.mcgraw-hill.com/

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

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