December 22, 2007
Comcast's view of the Christmas season is to pull presents out of stockings that are hung by the chimney with care.
Comcast is a licensed monopoly: cable. It delivers digital services on land-lines. It and Time Warner came to an agreement early this year on divvying up America's cities.
Both compete against DirecTV, the satellite system. Both compete against Netflix. Basically, both compete against everything that competes for people's entertainment money and time.
Recently, Comcast hiked my monthly bill for joint cable TV and internet service: from about $80 to about $100.
This weekend, its cable service dropped the three channels I actually watch regularly: IndiePlex, MoviePlex, and RetroPlex. These run free movies without ads.
When I enter each of the channel numbers on the channel selector, the screen announces: ???.
There was no explanation why the three channels were gone. There also was no upsell: "Subscribe to Comcast Premium Service for only $[??] extra per month, and you will get all 12 of Starz's uninterrupted movie channels, including MoviePlex, RetroPlex, and IndiePlex. Call this toll-free number today: 1-800-COMCAST." Instead, we get only this: ???
Later, I found all three. Incredibly, Comcast had moved the channels to new numbers, with no explanation or warning. There were no signs at the old channels saying, "Go to the new channel numbers."
What ever happened to "take care of the customer"?
For the first time in over two years, I am looking at DirecTV. I will switch in 2008.
A basic rule of profitable business is this: "Never give an existing customer on automatic billing a reason to look for a rival." The solution: More for less.
If you are in business or are thinking about starting, use Comcast as a reverse role model.
If you own shares of Comcast, consider selling them. Management has lost sight of the goal: customer satisfaction. Take a look at its share price chart.
It was $28 in mid-July, 2007. It is $18 today.
Compare its performance with its main competitor, DirecTV.
If you want to read an interview with a CEO who is on the defensive and ought to be preparing for an imminent career move, read this.
Q: Why is Comcast out of favor with Wall Street, and what can you do to boost your company's stock price? -- Kevin M. O'Neill, Hoffman Estates, ILL.A: We plan to keep growing our customers and to continue to invest in future growth that proves to investors we are, in the long run, in an enviable, secure position. There's increased uncertainty over the future, and unfortunately it may take time for people to get comfortable with the idea that more competition doesn't necessarily slow down growth.
Translation: "I do not intend to answer your direct, highly embarrassing question. That's because I haven't got a clue regarding what to do about the decline in this company's prospects. I am just trying to hang onto my salary and perks. My stock options are doomed."
When you can't make a monopoly pay, you need to be in another line of work. Maybe a mid-level administrrative position in the Post Office would offer a positive career move.
If I were to describe the company's Board of Directors, I would say, "Asleep at the wheel."
I believe Comcast is a company in permanent decline. The only hope that shareholders have is a takeover from a third party. The takeover bid would be based on the evidence of the incompetence of Comcast's present management. That surely would not be difficult to demonstrate.
Short this Christmas turkey!
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