Cox Cable’s Pricing is Banana Pants

I’m going to assume that everyone knows that their cable company is often negotiable. If you didn’t know that, then you do now.

I live in an area that Cox Communications is the only cable company. There’s no Verizon FIOS or competing service. There’s is always the Dish and DirecTV options. The Internet speeds promised by those solutions seem to top out at 15MB/s where Cox has 50MB/s and 100MB/s service. The service isn’t good enough to even be called “broadband” by the FCC’s new requirements.

Cox seems to know that they have me over a barrel… and at the same time they don’t.

If that’s confusing, it’s because after talking with the representative for 45 minutes to try to lower my cable bill.

When I signed on with Cox two years ago after a move, it was explained to me that I’d actually save money by taking their telephone service. The price of the bundle deal with the telephone was cheaper to buy than their two most popular products, television and internet, together.

The telephone component has sat in the box in my basement for two years. I have Ooma’s “free” service (just pay about $3 in taxes) which I love.

In reviewing my bill, I noticed something new. Getting the phone triggers $19 in taxes. At least that’s how it looks from Cox’s (paraphrased) wording of “Telephone taxes, fees, and surcharges” which is a separate item from the “television fees.”

It doesn’t make sense that all of the items in that telephone are actually telephone and there’s only a state tax for television fees, but that’s just Cox’s banana pants labeling of billing items. For now, I’m going to take Cox’s labeling as accurate that the phone triggers $19 in taxes.

I was paying $15 for the telephone service and $19 in taxes. My “bundle discount” was $23.64. Paying $34 to save $23 isn’t a recipe for saving money.

I called up customer service to see what could be done. The two-year deal bundle deal I had expired this month and my bill went up another $25. It was time to see what they could do, because I certainly wasn’t going to continue to pay for a money-losing phone service sitting in my basement.

I explained the issue of the phone not saving me money and that I’m not using it. Turns out that the phone was actually saving me money, because it triggered lower prices in the television and cable service in addition to the $23 “bundle discount” line item.

I figured I could use these prices to get me a discount. No luck. She kept on offering to put me back on the pricing I had with the phone… around $126 for the bundle. She explained that it would be $150 for my television and internet package without the bundle.

I countered by explaining that it makes no sense for them make me take a product (the telephone service) that I don’t want and pay extra money in taxes – money that doesn’t go to Cox – just to get better pricing on the two services that I do want. I can’t think of another industry that does anything like that. My landscaper doesn’t make my bill cheaper if I give him more work. He certainly wouldn’t do it, if it meant he had to divert even more money to taxes. If I made such a request, I wouldn’t be surprised if he said he didn’t want to work for me any more and stormed off.

I think we did about 6-8 rounds of back and forth. Each time she offered me the bundle with the phone to pay $126 or to just pay the straight rates on the two services which would be $150.

I explained that there’s a pricing online for the two services I use for $79.99. I’d like to get that deal. I was told that online deals weren’t applicable. And of course that online deal was only for new customers, not loyal customers. You’ll only see that deal if you aren’t signed in as a current Cox customer. Once you sign in or tell them that you have existing service it disappears.

I understand the business case for acquiring new customers and pricing attractively to them. However, it seems like a terrible business to charge loyal customers nearly twice as much.

I know that if I wanted to get the best pricing, I would have to threaten to quit to talk to their retention department as explained in this article. I’m thinking about getting pricing for DirecTV or Dish and using that to negotiate.

In the meantime, I decided to stick with the bundle which the Cox representative said would get me back to the $126 price. She typed it up and then had to deliver me the bad news. The price would be $131. I asked why that was. She said (paraphrased), “The bundle now requires the Home Phone Essential service, which includes caller ID and call waiting.” So now I’m going to get a bill that has $40 in charges for a telephone service and taxes that I don’t use… and this is Cox’s best pricing for the television and internet service that I want.

I’ll paraphrase what Bill Belichick says about weathermen, “If I ran my business like they do, I wouldn’t be in business very long.” As long as consumers lack choices, the cable companies can make up whatever banana pants pricing they want.

If you have the choice, always read broadband provider reviews before taking out a contract.