The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Regulators last night pledged to investigate Cable Bahamas’ TV service quality and said they were “majorly concerned” by the length and frequency of outages suffered by customers.

The Utilities Regulation and Competition Authority (URCA), in announcing it has approved the restructuring of REV cable TV packages, said it was unable to ignore “recurring complaints” from Bahamians about service interruptions and other issues.

Reporting on the replies received to the REV package restructuring consultation, URCA said: “Complaints regarding Cable Bahamas’ service quality was a recurring theme in the responses. In addition to public complaints, URCA is aware of persistent and wide-scale service interruptions in the form of error messages consistently appearing on screen, regular service outages at 2am, pixelated channels and other issues.”

“Although comments concerning service quality are out of scope for the current application, URCA is majorly concerned with the level and frequency of service interruptions and will open an independent investigation following the publication of URCA’s final decision to better understand these and other matters surrounding Cable Bahamas’ service quality.”

The communications industry regulator urged Cable Bahamas customers to bring such issues to its attention via its “complaint handling process”, and added that its “quality of service” regulations may be able to redress some of the problems.

However, URCA did not do what many had urged in their feedback, and require that service quality issues be addressed before it approved Cable Bahamas’ REV channel package restructuring and any associated price increases.

“Many respondents were unhappy with Cable Bahamas’ television service quality due to recurring outages, error messages, pixelated channels, an incorrect TV guide (what was stated on the TV guide did not match what was shown on TV), and dissatisfaction with DVR boxes,” URCA said in a deeper description of the feedback received.

“Respondents felt that Cable Bahamas should correct its service quality issues before restructuring its packages or increasing its prices. Respondents were unhappy that they did not receive any reimbursement for Cable Bahamas’ outages or service disruptions.

“In their view, Cable Bahamas did not practice any leniency when applying late fees or sending bill reminders despite regular disruptions. Some blamed Cable Bahamas’ reduction in subscribers on the poor quality of service instead of the advent of competing streaming services which Cable Bahamas attributed the subscriber attrition to in its applications,” URCA continued.

“Others claimed they would be willing to spend more on pay TV if Cable Bahamas improved the quality of service. Respondents felt that Cable Bahamas should improve its service quality before applying for any type of price increase or restructuring of its packages.

“On a similar note, some respondents felt the repackaging changes were not enough to improve their level of satisfaction with Cable Bahamas. In addition, for those who no longer subscribe to Cable Bahamas’ TV services, some stated the repackaging would not make them resubscribe.”

URCA had previously agreed that Cable Bahamas was not earning a “worthwhile” rate of return on its REVTV product, with subscriber numbers set to further decrease unless its channel line-up was restructured.

In launching the public consultation on revisions to the TV packages, it said historical data combined with future viewing and financial forecasts had made out a sufficient case for the company’s application to be considered.

And Cable Bahamas had previously told Tribune Business that the TV channel packages were designed to better reflect consumer demands and enhance its competitiveness against rival video streaming services, such as Netflix, Amazon Prime and Hulu.

However, URCA said of consumer reaction: “A few still considered the revised packages to be too expensive and unattractive, especially compared to alternatives such as Netflix, Fire TV Stick, and Disney Plus. In addition, some respondents claimed Cable Bahamas often changed or removed channels without notice and felt they were already paying more for fewer channels.

“There was some concern that by moving certain sports channels from REVTV PRIME to REVTV Sports, REVTV PRIME subscribers will lose access to sports games. In addition, others disliked that REVTV PRIME will no longer have any movie channels if Cable Bahamas moved the Cinemax and TNT channels from REVTV PRIME to REVTV PRO as part of the repackaging.”

URCA, though, stuck with its original analysis, saying: “In reference to the packages being too expensive, Cable Bahamas’ financials show that it is not currently earning an over-recovery on its cost of capital, and this will remain the case after the repackaging is implemented.......

“Based on the supporting evidence available in Cable Bahamas’ applications, the changes will not result in Cable Bahamas earning an over-recovery of its regulated cost of capital on the pay television service.

“The accompanying spreadsheets demonstrate that Cable Bahamas’ subscriber numbers have been trending downward and will continue to do so. Therefore, some intervention is needed to arrest the ongoing decline,” URCA added.

“In addition, the spreadsheets support Cable Bahamas claim that the repackaging will reduce content costs and improve the margins on the affected packages while keeping the headline price of REVTV PRIME the same. The changes will help to ensure the television service provision remains economically attractive on a going-forward basis by making the affected packages more cost-reflective.”

URCA, though, stipulated that Cable Bahamas must give its TV subscribers no less than six weeks’ warning before the revised package line-ups and pricing come into effect. The changes include a net decrease of channels in its most-watched REVTV Prime offering, which will fall from 72 to 68 while the monthly price remains the same.

Channels such as BET, TV One and BBC America are being added to this package, based on viewing and subscriber demand, while the likes of MTV, Cinemax, TNT HD and the two Sports Max channels are being removed.

Cable Bahamas customers will no longer be required to subscribe to the REVTV Pro package to receive “add-on” bundles, while the REVTV Prestige, and REVSportsPrime packages will be discontinued.

Instead, the BISX-listed communications provider’s TV offerings will mirror that of major programming/content producers such as Disney and Fox. It will offer residential subscribers a seven-strong REVTV Kids line-up for $5 per month, along with 16-channel REVTV Sports for $15 per month. The latter compares to ten channels under the previous REVTVSportsPrime at $10 per month.

REVTV Lifestyle Extra; REVTV Rhythms; and REVTV News and Science round out the new residential packages, with the changes involving moving content and channels around rather than any major price hikes.