Instead of buying Verizon’s bluster, we asked a few early subs for their impressions of FiOS TV. Their opinions should prompt cable to act. By Catherine Applefeld Olson We’d heard Verizon’s FiOS TV hype. To cut through the clutter we decided to hit the streets and talk to early subscribers, to see what kind of competition cable faces. Admittedly, our conversation with five customers is not a scientific survey, and many early subscribers retain the glow of discounts and months of free service. Also, three of the FiOS subs we spoke with were referred to us by Verizon. Still, what we found should be a wake-up call for cable. Prior to our interviews, we’d heard about outstanding picture quality and a user-friendly remote. Unfortunately for cable, our consumers confirmed these selling points. When it comes to customer service, we expected to hear tales of woe. In fact, our consumers told us the opposite. The FiOS customers raved about the easy-to-use program guide and DVR. Competitive pricing was a big draw. Yet with premium packages and VOD, many customers now happily pay more for FiOS than they did for their previous video service. FiOS TV = MORE TV VIEWING Eric Young is an attorney for the U.S. Coast Guard, a frugal, tech-savvy, DIY kind of guy who wasn’t looking to switch television service when FiOS came to his Reston, Va., neighborhood. "I had no complaints with Comcast’s performance," he says. Yet in November Verizon upsold Young, an existing DSL customer, to FiOS TV, Internet and fiber optic phone service. It did so by offering him the opportunity to try the service free for a few months. He could then terminate if he wished, no strings attached. Young hasn’t looked back. He loves the FiOS program guide, the remote and the 20-plus sports channels on his premium package. As a result, he’s watching more TV and gives the DVR (included in the package) a rigorous workout. He never bothered to get a DVR with cable because he didn’t want to pay the monthly fee. "On a normal night, I actively scroll through some 300 channels on the video guide at least three times," Young says. With a signal quality that’s "head and shoulders over what I was getting on cable," he’s willing to let slide the 10-second re-pixillation process that distorts the screen about once a day. The catalyst for Young wasn’t Verizon’s marketing material, which he says is too vague on pricing. In fact, none of the customers we interviewed were hooked by mailings. They also were blas� about Verizon’s numerous ads in local businesses. GUERRILLA MARKETING EFFECTIVE What’s working is guerilla marketing. Phone calls to existing Verizon customers. House calls in neighborhoods where FiOS TV is available or coming soon. Once Verizon gets FiOS into a house or two the service seems to sell itself. This is certainly the case in the fishbowl town of Keller, Texas, where 23% of residents are FiOS subscribers. Keller resident Marc Clemons "battled" two cable operators and weather-induced satellite woes before eagerly handing over about $75 per month to Verizon for video service last August. Before moving to Keller a few years ago, Clemons had terminated service with Comcast because of what he called poor picture quality and even poorer customer service. "I would call and say our local channels were fuzzy and we’d get, `We can’t help you; there’s nothing we can do at this point.’" Comcast declined comment for this story. THIS IS NOT COMCASTIC! Comcast’s attitude was nothing compared to what awaited Clemons in Keller. He found Keller operator Charter Communications to be "the absolute worst people I’ve ever dealt with in my entire life." After one month with Charter, Clemons opted out and signed on with the now-defunct HD satellite service Voom. He then moved to DirecTV. But Clemons says satellite is not a reliable option in Keller because frequent seasonal storms wreak havoc on the signal. Indeed, Keller resident Doug Fowler says Dish Network would lose signal for 30 minutes to an hour during storms. "The FiOS system is light years ahead of Dish in terms of the picture quality and the program guide," he says. "With Dish, when you wanted to advance the program guide you had to wait a few minutes for it to download. The FiOS guide comes up immediately." BROKEN DISHES LOSE CUSTOMERS "It was up to fate if we got a signal," says another Keller home owner, Vernon Drewa Jr., of his former DirecTV service. "If there was inclement weather we’d lose the signal and then call and wait for someone to come on line to help. It was good for its day, but nothing lasts in this business." For his part, Young, the Coast Guard attorney in Reston, Va., says he’d climbed up one too many neighbors’ roofs to trim a branch or adjust a dish to trust satellite service. Today he pays $72 for FiOS TV, plus $30 for monthly Internet service. He receives a $5 discount for being an early adopter. That’s a few dollars more than the $50 TV and $50 Internet fees he’d shelled out to Comcast for more than five years. Since August, Drewa, a retired federal aviation specialist in Keller, has been paying about $120 per month for FiOS basic, plus two premium packages on five TVs (he’s also a Verizon DSL and phone customer). Inquisitive neighbors still beat a steady path to his living room, and he estimates 20%-40% of them have become FiOS customers. Aside from garnering ooohs and aaaahs over picture quality, Drewa most enjoys Verizon’s customer service. He’d give it an A+. "I have not had any bad dealings with anyone connected with Verizon," he says. "If I have a question, they get it answered." Yet the transition to FiOS has not been entirely smooth for all customers. While digging in Clemons’ yard an installer accidently cut his sprinkler system, though by the time Clemons called customer service a Verizon contractor working on another installation up the block had been notified. Back in Reston, the crew burying fiber in Young’s yard hit a water line but fixed it within the hour at no cost and with no property damage. Adds Young, "I’ve never seen finer digging. They laid the same pieces of grass back in the same spot." A GREAT INSTALL EXPERIENCE This attention to detail translates to inside installation and customer service. For Young, a six-person team not only "aced the job" but one installer spent an hour with him to help set up e-mail addresses and show him how to use the remote, DVR and TV service. [Verizon acknowledges the typical install includes two service personnel, one likely a trainee.] "When they came in and out of the house they put on booties to walk across floor. When they had trash to throw out, they didn’t use our garbage can," Young says. Clemons’ monthly fee is on par with what he was paying for DirecTV and buys him service on three TVs, two HD DVRs and a sports package. The easily programmed DVR means he rarely watches TV in real time, and he is "in awe" of the signal quality, which has "no distortion, disruption, fuzz or pixillation." "Is FiOS TV worth $75 month? For what I have, absolutely, yes. Was Charter worth $50 a month? I don’t think so," he says. Charter declined comment for this story. THIS IS STILL NOT COMCASTIC! Perhaps most telling, Young was willing to give Comcast another shot when his FiOS TV and Internet trial ended, if only to maintain the Comcast e-mail addresses he’d had for five years. He asked Comcast to match Verizon’s $30 fee for Internet service. "I said, `I’d like to keep your Internet service’" but Comcast wasn’t willing to talk, Young says. "It wasn’t until I called back to turn off my service that they came back with an offer $5 below Verizon’s price." Now he has a message for Comcast: "They have a failure at the business-plan level and now I’m paying $20 more per month than I used to pay for their TV service. They had me at hello, but they screwed up."

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