Can TV, Internet and phone bundles save you money?

January 22, 2008

Many consumers feel bombarded with pitches to receive their cable TV, Internet and phone service from one provider. But don’t dismiss them too quickly. Consumer Reports recently found that so-called bundles or triple-play packages might save enough money to be worth the disruption of switching some services.

And a new survey by the Consumer Reports’ National Research Center finds it’s not necessary to compromise service quality to buy a bundle. Subscribers to many companies were reasonably satisfied with all three of the most commonly bundled telecom services. Telephone companies, principally Verizon, continue to expand fiber-optic networks, which allow them to compete more easily with cable providers to offer a full array of telecom services, including TV and Internet.

Satellite-TV providers can’t offer viable bundles alone, since satellite-based phone and Internet service is expensive and, for Internet access, also slow. But satellite providers are partnering with phone companies to create bundles comprising satellite TV, DSL Internet and landline phone service.

Verizon FiOS, whose network is fiber-optic based, received superior scores for reliability and performance for its Internet, television and telephone services. CR’s next best choices for many households — including the giant Cox and smaller companies Bright House and Wow — are fine alternatives to Verizon FiOS if available.

For consumers who consider TV service paramount, but live in areas where Verizon FiOS is unavailable, CR experts recommend that they consider DirecTV. This satellite-TV provider scored significantly higher than all the major cable companies for TV service.

Here’s what CR found from its survey on telecom bundles:

• People can get a good deal. A bundling mainstay is the one-year, $99-a-month package, typically made up of a premium level of TV service, standard-speed broadband Internet service and telephone service with a variety of calling features. Such deals could save up to hundreds of dollars a year compared to paying for the three services separately. However, bundling is less likely to save money for a consumer whose needs are simple — say, basic TV, minimum-broadband Internet and telephone service with little or no long-distance calling.

• Bundles aren’t yet tidy. For one, they’re distinguished by a profusion of plans that can be hard to compare. For example, in one part of New York this fall, Verizon offered six bundles, four of them $99-a-month deals, two of which appeared to be identical. CR found that Comcast was the best provider in spelling out what the fee would be after the promotional period.

• Find out what’s available. Most neighborhoods are wired for cable, and a small percentage of homes have two cable companies from which to choose. Satellite is generally available for homes with an unobstructed view of the horizon to the southwest. DSL is widely offered in urban and suburban neighborhoods. Fiber-optic service — FiOS from Verizon and U-Verse from AT&T — is spreading fast but is so far available to only about 8.5 million homes in about one-third of the states.

• Consider installation and safety. Bundles are so complex that it pays to call carriers to ask about the total cost, policies about dropping or changing services, and the post-promotion rate. CR found that on the phone, providers may also be open to haggling on installation and other costs.

When switching to cable-television service, which is Internet-based, consider spending about $20 a month to retain basic landline service. A landline is more reliable for 911 calls and will continue to work in power outages with a phone that doesn’t require AC power.

Haggle when the promotion ends. Don’t blindly renew service at the end of the promotional period. Some promotional prices include premium features, such as additional TV channels, that are great at the outset but will leave customers paying more once the promotion ends. Some companies may automatically delete features, such as unlimited long distance, unless customers tell them they want to pay extra to keep them. Also, check competitors’ prices for bundles and for unbundled services. Then consider haggling with them, too.