Comcast (NASDAQ:CMCSA) seems to know what it should be doing, but the company still has trouble actually getting it done. Like a fourth-grade boy who understands that he's not supposed to pull on the ponytail of the girl sitting in front of him, but does it anyway, the company seems incapable of good behavior.
The cable giant has made every effort to fix its lousy customer service and improve its customer relations. Unfortunately, whenever it appears that the nation's largest cable and Internet provider gets it, the company puts its proverbial foot in its mouth.
In this case, it was CEO Brian Roberts, who said the exact right thing while his company proceeded to do the exact opposite. It's a problem caused by the vast size of the company, and it shows that, despite the best efforts of Roberts and cable division head Neil Smit, Comcast has yet to become a customer-first brand.
What did Roberts say?
Speaking at the Goldman Sachs 24th Annual Communacopia Conference recently, Roberts noted that higher content costs are leading to higher prices, The Hollywood Reporter reported. "You can't keep raising the price forever," he said. "These things have a way of correcting and balancing out before something draconian happens."
That sounds nice, and it would uplift customers used to steady price increases -- except, essentially, as the CEO said it, the company began rolling out price increases to many of its systems.
How much are bills going up?
Comcast never makes it easy to track how much it raises prices by, because the increase varies by region. The company also rolls out new pricing slowly across its various markets rather than implementing them all at once.
That, a cynic might say, could be a way for the cable and Internet provider to avoid national stories on it raising prices. Still, local media picks up when new pricing hits each market. Here are some examples:
"On average, customer bills nationwide will increase by 3.4%," The Albuquerque Journal reported recently, citing a Comcast official.
Entry-level rates are going up as well, about 4.5% for TV and Internet service in its area, The Oregonian reported recently. "The cost of Comcast's standard, 140-channel Digital Starter package is rising by $3.25 a month, to $75.74," the newspaper wrote. "The cost of its standard Performance Internet service is increasing by $3 a month, to $69.95; the company's rate cards indicate speeds will climb from 50 to 75 megabits per second."
Comcast says the increases are justified
Comcast justifies the increases by pointing to improved technology. The company sent out a notice of the new prices in its September bills, and the Albuquerque Journal received the following quote when it inquired about the increases:
We continue making investments in our network and technology to give customers more for their money, including more video across platforms, better experiences like X1 and faster Internet service. We periodically need to adjust prices due to increases we incur in programming, business costs and new technology.
Comcast turned down a request from Ars Technica for a list of price increases by market.
The time has not yet arrived
While Roberts acknowledged that you can't keep raising prices forever, clearly, forever has not yet arrived. His remarks show that, while the company has made strides in becoming more customer friendly -- mostly by adding reps and beefing up its social media response team -- it still has a long way to go.
The CEO is right that cable prices can't go higher without potential repercussions. It's simply too easy to cut the cord and not miss out on very much. Roberts needs to listen to himself, and realize that his company's path to growth, or at least maintaining audience, is lower, not higher, prices. Until he does, the company will continue to preach one thing while doing another -- and that's never good for building relationships with your customers.
Daniel Kline has no position in any stocks mentioned. He has a Comcast account at his office due to lack of choice. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.