In classical economics, one of the problems with monopolies is arrogance. The monopolist doesn't truly care for his customers as long as the money keeps flowing.
For nearly two decades, Cox Communications has had a near monopoly in our neighborhood for TV and internet. It's been a near monopoly instead of a true monolopy because you can get TV via satellite, and internet via dialup. Yeah, sure, like my family of computer geeks could live with dialup.
In any case, I've been a customer of Cox since the first coax cable was laid. In addition to TV and internet, Cox has phone service. I call it the communications trifecta. With all this and DVR rentals, we've been paying over $200 a month. And that doesn't count our Verizon cell phones.
So a year ago, in a moment of weakness, my wife listened to a Cox rep on the phone, and signed up for a year of Showtime and Movie Channel at a reduced rate. The kicker to the deal was an early termination fee that was more than the cost of the monthly subscription. Fine, it was just a couple of dollars a month, so I agreed to it.
Ten days ago, since we had rarely watched any of those channels, I called Cox to cancel the service. I had a short, friendly chat with the Cox rep, and as he processed the cancellation, he noticed that we had the trifecta with Cox. He said he could save us a bunch of money because we had all three services. "Cool", I said, and our conversation ended in about two minutes.
Yesterday, June 27, I received a letter from Cox, dated May 28, welcoming me to my new service plan. It detailed how I was saving $15 a month because I had all three services, and that I had agreed to a one year service plan with an early termination fee of $180 if I did not cancel this agreement within 15 days. Excuse me? I just received a letter that was void as soon as I received it. I immediately called Cox, and asked for a supervisor. I was astonished and firm, she was calm and professional, and she agreed to indicate in my account record that I would not have to pay the $180 termination fee.
So where's the irony? An hour after I get off the phone, there's a knock on the door. It's Verizon. I greet the young man with the blue Verizon polo shirt. He's selling FIOS internet service. It's much faster than Cox, and it's $50 a month cheaper. And, it comes with a free Netbook (MSRP $300). I had forgotten that Verizon had been laying fiber in our neighborhood for almost a year, and that many of my neighbors had switched over, including one of my poker buddies. "OK", I said to him after 20 seconds of his pitch, "if I sign up can I cancel?". "Of course", he said, "in the state of Virginia it's a state law that you can cancel contracts like this". So I signed up. What the heck. All it took was about 20 minutes and a conversation with that third-party company that verifies that the Verizon rep in the blue polo shirt hasn't coerced me into signing up with his company.
But the irony gets better. Today, Sunday, I check with my son to make sure that the switch of communication providers won't mess up his life. No worries, his DVR recordings don't interfere with ours. So the only issues to our transation is that my wife will need to get a Gmail account instead of a Cox account.
Then, I figure this situation would be good for a blog post. It's classical economics at its best - competition breaking a monopoly.
I turn on my laptop, turn on the TV, login to this forum, and switch to the NASCAR race. I type for five minutes, and the race goes black. This is a common problem with Cox, a single digital program disappears without warning. Fine, I switch to ESPN2 for the 2008 Poker championships. Another five minutes, and this channel goes black.
You have to be kidding me! I'm writing an article about how I'm dropping my Cox service, and their service gets worse! All other channels still work fine, but the only two channels I want to see don't work.
Triple irony. Goodbye, Cox, hello Verizon.
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