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.comjperlman@brandwaregroup.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. http://www.jdpower.com/corporate

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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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