J.D. Power and Associates Reports: Customer Satisfaction With Residential High-Speed Internet Service Declines Slightly From 2009

WESTLAKE VILLAGE, Calif., Oct. 28 /PRNewswire/ -- Overall customer satisfaction with residential high-speed Internet service providers has decreased slightly from 2009 due to declines in satisfaction with cost of service and offerings and promotions, according to the J.D. Power and Associates 2010 Internet Service Provider Residential Customer Satisfaction Study(SM) released today.

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Now in its 13th year, the study measures customer satisfaction with high-speed Internet service based on five factors: performance and reliability; cost of service; billing; offerings and promotions; and customer service.

The study finds that overall satisfaction with residential high-speed Internet service averages 634 on a 1,000-point scale—a decrease of five index points from 2009.

The study also finds that customer satisfaction with cost of service averages 584 in 2010—a 12-point decrease from 596 in 2009. Contributing to this decline are decreases in satisfaction with fairness of prices paid and ease of understanding pricing options.

"Although product performance is most important in retaining customers, the top reason they switch providers is cost-related," said Frank Perazzini, director of telecommunications at J.D. Power and Associates. "Customers who give low ratings to their provider in the areas of fairness of fees and understanding the prices paid are the most likely to switch because of price. The good news for incumbents is that from 2009 to 2010, industrywide intention to switch remains unchanged, while the percentage of consumers who intended to switch for price actually declined one percentage point. With price being key to retaining customers, providers must establish that their pricing is competitive and their service is a good value."

Among customers who intend to switch for a better price, satisfaction with fairness and ease of understanding is lower than the industry average. However, the percentage of customers who actually switched service providers during the past 12 months for reasons other than moving has declined by more than 25 percent, compared with 2009.

"Should the decline in switching rates continue, it may trigger shifts in how service providers allocate spending on acquisition and retention programs," said Perazzini. "For instance, implementing best price guarantees, which are commonly seen in retail stores, could reduce switching rates even further."

High-speed Internet service providers are examined in four regions:

East Region: Optimum Online ranks highest with a score of 659 and performs particularly well in two of five factors: offerings and promotions and customer service. Verizon follows in the regional rankings with a score of 658, while EarthLink ranks third with a score of 643.

South Region: With a score of 675, Verizon service ranks highest in the South region and performs well in the performance and reliability and offerings and promotions factors. EarthLink follows in the rankings with a score of 672, while Bright House Networks' RoadRunner service ranks third with a score of 661.

North Central Region: Performing particularly well in all five factors driving satisfaction, WOW! ranks highest in the region with a score of 722. Cincinnati Bell follows with 674, while Cox Communications ranks third with 671.

West Region: Cox Communications ranks highest in the West region with a score of 659 and performs particularly well in performance and reliability, cost of service, billing, and offerings and promotions. Following Cox in the regional rankings are Cable One (646) and EarthLink (642).

The study also finds the following key trends:

• The overall satisfaction gap between DSL customers and cable modem customers has narrowed by eight index points between 2009 and 2010 and now stands at 17 (638 vs. 621, respectively).
• Technician visits to households using DSL are due to issues such as troubleshooting and service restoration 63 percent of the time, compared with 53 percent among cable modem users.
• Competition may breed satisfaction, as overall satisfaction among respondents who have one choice for Internet service averages 556. For those with three options, overall satisfaction averages 653, while satisfaction among respondents with five options averages 665.

The 2010 Internet Service Provider Residential Customer Satisfaction Study is based on responses from 29,847 residential customers of Internet service providers nationwide. The study was fielded in four waves: November 2009 and January 2010, April 2010 and July 2010.

About J.D. Power and Associates

Headquartered in Westlake Village, Calif., J.D. Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction. The company's quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on telecom reviews and ratings, please visit JDPower.com. Also available are car reviews and ratings, car insurance, health insurance, cell phone ratings, and more. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

Founded in 1888, The McGraw-Hill Companies (NYSE: MHP) is a global information and education company providing knowledge, insights and analysis in the financial, education and business information sectors through leading brands including Standard & Poor's, McGraw-Hill Education, Platts, and J.D. Power and Associates. The Corporation has more than 280 offices in 40 countries. Sales in 2009 were $5.95 billion. Additional information is available at http://www.mcgraw-hill.com/.

Media Relations Contacts:

John Tews; J.D. Power and Associates; Troy, Mich.; (248) 312-4119; [email protected]

Jeff Perlman; Brandware Public Relations; Westlake Village, Calif.; (805) 418-8626; [email protected]

No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power and Associates. www.jdpower.com/corporate

SOURCE J.D. Power and Associates