On The Olympics, Cable and the Danger of Duopolies

Those who follow the blog regularly might be surprised that I haven't written anything about the Olympics, arguably the biggest event in the world right now. The truth is, I haven't written anything about the Olympics because I haven't watched even a minute of the games. And, while I don't always let a lack of firsthand knowledge stop me from writing about a topic (often with very...interesting... results), I do at least need to at least have some thoughts about something before I write about it. Not having watched any of the games, I haven't felt the need to write about them.

Why haven't I watched any of the Olympics? I place the blame squarely at the feet of the big cable providers in DC, Comcast and Verizon.

Comcast has given the following excuses for why I don't have cable or internet currently (many thanks to the far more accommodating local Safeway for use of their connection): We need a week to schedule an installer; Verizon cut our wires; we need to get into every apartment above and below you to fix the wires; you didn't pick up on the first ring, so we couldn't confirm we should come; our office doesn't talk to that other internal office, so you will need to call them and tell them to call us.

Once I became so fed up with Comcast that I gave up trying to resolve the situation with them, I tried to get bundled service through their main (only?) competitor. While Verizon doesn't share the same blame as far as installation goes, its faults actually appeared even further upstream during the initial sales process. When dealing with them, I uncovered, using sleuthing more than reading skills (as it is never actually stated anwhere on their webpage) that the contract for the service I had selected is for 2 years, whether or not I end up staying in my current apartment the entire time. This is despite the fact that their website didn't so much as note a two year commitment and even though no paperwork to that effect would have been signed.

Though this wasn't a deal breaker as I have no intent to move anytime soon, the rate I would have received, and the only rate I was shown all the way up to the checkout screen, was only for one year. After that, in year two of Verizon's unsigned and undiscussed, but very unbreakable contract, prices jump by about 35%.

An online sales rep had the gall to assure me that the price increase was only on the cable portion, and that it didn't impact the internet or phone service. On a bundled package. That can't be unbundled. Twice. Needless to say, I am still without cable and have an inclination to continue on that way.

While it would be easy to dismiss the above as the gripings of a sour customer, there is an important economics lesson; the less competition there is in a marketplace, the more consumers will suffer. By almost any definition, most cable providers act as duopolists or monopolists depending on the market they are in, and even what building you live in (sometimes local providers fail to service certain buildings). When there is no competition, and indeed when there is apparent price fixing occurring for a good that many people treat as more or less inelastic these days, producers will always win.

In a zero sum world, that means that, more often than not, consumers lose.

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