Monday, June 21, 2010

Cable Competition Fiercer

I personally never thought that the two year contract was a big stumbling block for consumers choosing FIOS over cable. It certainly was something touted in cable ads to scare prospective customers from switching from cable to telco. And for public record, I am still a cable customer, but every time I see my bill, I consider switching. I actually like d the two year contract cause it guaranteed the consumer that their price wouldn't rise unexpectedly.

But in a move to create a more level competitive playing field, Verizon is offering its FIOS service without any contract. "Verizon introduced the month-to-month option last month in Tampa, Fla., as well as in Pennsylvania, which 'met with very favorable customer response,' the telco said in announcing the expansion of the program Monday." Will this marketing move result in more connects, we will have to see. For those consumers who did see a contract as a stumbling block, this option should provide some of the flexibility they desire. Considering the time it takes for both companies to install their service, and the time the consumer must stay in their home waiting for the service call, quick switching should hopefully not be an option.

Will FIOS subscriptions rise through this new pricing offer, I'm sure in the short term there will be lift. For me, the key to success remains a combination of low pricing, great service, easy use, and terrific programming content. The latter three require strong differentiation marketing to let the consumer know all they offer that their competition doesn't. In a free market, competition is good and leads to the victor providing best for the consumer.

1 comment:

  1. Don't forget that Verizon has filed to sell its landline and FiOS assets to Forrester Communications, intending to get out of wired/fiber and focus on being a wireless company (though the deal details, such as Forrester buying the assets for something like 80% of its common stock) looked like they were essentially buying Forrester to run the wired assets for them.

    Comcast has been playing on this with an ad campaign stating that Verizon FiOS is leaving Washington, but Comcast is staying.