Cut your telecom bill

Many of us love to hate our home telecom provider. In our latest survey, our readers once again ranked telecom services as less satisfying than most other services we rate. Yet there were a few companies that managed to please subscribers for TV, Internet, and home phone. Trouble is, it's unlikely they serve your area.

Case in point: One of the best providers in our Ratings is a regional cable company you may not have heard of—WOW, which serves four Midwestern states. It was among the top-rated providers for TV, Net, and phone and for bundles of all three services.

Then there's Verizon FiOS, another of the top services, available in portions of 12 mostly Eastern states, District of Columbia, southern California, and Texas. Verizon is the only major provider that runs its high-speed fiber-optic network all the way to your house rather than switching to bandwidth- and speed-limiting copper wiring at a neighborhood "node" as many cable companies do and AT&T U-verse typically does. FiOS's "bigger pipe" may help explain its top ratings for TV picture quality and Internet speed.

Unfortunately, even in regions where Verizon already operates, it has stopped or slowed down wiring new neighborhoods for FiOS. So if it hasn't yet made it to your doorstep, chances are it won't this year.

Further, consumer advocates fear Verizon may have less incentive to compete with cable companies now that it has entered into partnerships with Comcast and Time Warner Cable, among others. The cable companies would give Verizon unused wireless spectrum for its cell-phone network, and Verizon and the cable companies would market each other's services through bill mailings, stores, and more. Consumers Union, the advocacy arm of Consumer Reports, opposes the deals, which are now under regulatory review.

Though you might not be able to get FiOS, one of the highly rated small cable companies, or local alternatives such as the innovative utility service in Chattanooga, Tenn., you can still level the playing field with providers and deal from a position of power. Our report outlines five strategies you can use to help you get the best service and biggest savings in telecom.

For maximum flexibility, try to avoid signing a contract with early-termination penalties, which will limit your ability to negotiate rates or switch providers. Some providers require a contract, so you're stuck. But others give you the option of a contract-free plan, usually at a slightly higher rate. It's worth paying a little more to maintain your bargaining power.

Seven out of 10 readers with a triple play didn't even try to bargain on their telecom bills. Yet of those who did, more than 90 percent got some accommodation. They were more likely to get a break on bundles from cable companies and phone companies' fiber services than on hybrid bundles (of DSL, phone, and satellite TV).

Price reductions led the list of concessions, with around 40 percent of bargainers reporting savings of up to $50 a month. About 30 percent had fees for installation or activation waived, and 30 percent or so said they got free premium channels. Be sure to cancel the freebie channels after the trial period ends or they'll continue with a monthly fee.

Hagglers' experiences suggest that it can pay to let your provider know you're ready to drop some or all of its services. Survey respondent Elvis Wright of Lubbock, Texas, got his cable company, Sudden­Link, to take back $8 of a $10 general price increase in his monthly bill by threatening to cut out some services. You can also tell your provider you'll consider switching to a rival service, even if you'd really prefer to stick with the status quo.

For specifics on how to negotiate with your telecom company, learn how to haggle for a better bundle.

Readers gave some companies, including Verizon FiOS and Cox, high marks for limiting price increases after a promotional rate expired. But others (notably Cablevision and Comcast) hiked rates considerably, survey respondents reported. If your provider's rates soar after a deal ends, push back. Use competition among providers to your advantage. Though you might not have another cable choice, satellite TV serves all but a few parts of the country, and Verizon FiOS or AT&T U-verse is an option in about one-third of the U.S.

Be prepared for resistance from your TV provider, though. Companies are increasingly keeping track of the promotions they give you and offering smaller discounts when you ask them for another break. "We have a very well-choreographed program for moving people from the most heavily discounted promos into the rational next-step pricing packages," says Rob Marcus, president of Time Warner Cable. "Over time, that discount will decrease, but you'd probably still save 20 to 30 percent off the rack rate," or regular price.

Sometimes brinksmanship is your best strategy. A Consumer Reports staffer who'd gotten discounts from her cable company for a few years in a row was denied yet another discount when her last promotion expired and the triple-play rate jumped to $170 a month. She decided to switch to Verizon FiOS to save $50 a month in the first year and $30 the second. Before sealing the deal with Verizon, she called the cable company to ask how to disconnect. She was transferred to a "customer retention" specialist, who upgraded her to the next TV tier, which included Encore, Showtime, Starz, and a few other channels and cut her bill to $140 a month.

"The magic word is ‘cancel,' " says Phillip Dampier, of the website StopTheCap.com. He suggests you schedule your disconnection date for a week or two in the future. "When you're on their disconnect list, they are going to start calling you offering very aggressive deals," he says.

Among readers who had changed TV providers in the previous six months, about one in three were offered new savings—in some cases $20 or more a month—by their old provider if they didn't switch to a new company or decided to come back after switching.

But don't despair if there's only one provider in your area. Alan Curtis of Manchester, N.H., whose condominium is served only by Comcast, says his rates go up each year but he pushes back. "If you say, ‘We'll have to buy less,' occasionally they'll come up with a cost-cutter that will apply to you," he says. Similarly, a staffer who lives in a New York City apartment served only by Time Warner Cable more than offset a $5 increase in his overall bill by negotiating an $8-a-month cut in his DVR rental fee for 12 months.

Beware of such small, often stealthy increases. Carriers are "creative at adding a few bucks here and there" after promos expire, notes Arthur Gruen, president of Wilkofsky Gruen Associates, a telecom industry consulting firm. Watch for letters notifying you of rate changes, and check statements periodically. Compare them with previous bills so that you'll detect even minor increases that might otherwise escape notice.

The data speed of your Internet service affects how quickly you can send and receive files, how smoothly content (especially video) streams and at what resolution, and the ability to play interactive games on the Web. Yet eight out of 10 consumers don't even know what speed they're getting from their Internet ser­vice provider, according to the Federal Communications Commission.

Speeds (measured in megabits per second, or Mbps) have generally been rising for standard service, sometimes without a rise in rates. Many cable providers have upped their standard speed in recent years, as have the AT&T U-verse and Verizon FiOS high-speed phone-company services. But cable companies and high-speed phone services increasingly offer a number of step-up speeds as premium features. Here's our advice on what you need:

Light usage. You typically have only one or two users at a time e-mailing, Web surfing, downloading short, standard-definition videos, and playing simple online games such as Farmville. File uploads, such as low-resolution photos, are small.

Recommended: speeds of up to 3 Mbps. That's available from DSL, satellite, and wireless broadband service.

Moderate usage. One or two simultaneous users is the norm, with three online at times. Video streaming is common, including some in HD, from such Net services as Vudu and iTunes, and you can accept occasional quality compromises due to limited bandwidth. You might play two-way HD games, use an online backup service, or occasionally upload high-resolution photos to the cloud.

Recommended: 6 to 12 Mbps. That's standard for most cable companies and with some AT&T U-Verse packages.

Heavy usage. The number of users, data demands, or both, is high. Up to four people may be online at once, with some using a tablet or smart phone. Some may stream HD video or play HD games and demand good quality. A serious photographer or videographer who accesses the cloud might be among the users.

Recommended: at least 15-Mbps service. That's standard for a few providers, such as Verizon FiOS and Cablevision, and available as a step-up from others, including AT&T's Max Turbo service.

Keep in mind that speeds aren't always as claimed. An FCC study released last year, involving speed measurements by 6,800 customers of the 13 largest Internet providers, suggests that carriers deliver the promised speed most of the time. But some underperformed, especially during the peak hours of 7 p.m. to 11 p.m., when speeds could be 5 to 10 percent lower than the 24-hour daily average. You can gauge your own speed at Broadband.gov.

DSL providers as a whole sustained download speeds during peak hours that met only 82 percent of claims—a concern, given that their speeds are on the low side. Frontier DSL, which had relatively low reader scores, delivered only 67 percent.

Cable companies overall met promised speeds more than 90 percent of the time. Cablevision delivered only 50 percent of advertised speed for its standard 15-Mbps service and 69 percent for its 30-Mbps service. But readers gave it high marks for speed, perhaps because its standard speed is more than users generally need.

Verizon FiOS aced the FCC tests, exceeding the claimed speed for every level of service measured, including its 35-Mbps offering, with barely any fluctuation at various times during the day. Unsurprisingly, its speed score with readers was a standout.

Satellite-based Internet service from HughesNet and WildBlue received two of the lowest scores for speed in our survey. ViaSat, which no longer sells WildBlue service to new subscribers, said it has boosted data download speeds to as much as 12 Mbps since we surveyed our readers.

AT&T, Clear, and Verizon wireless broadband services (all used by some readers as their main home Internet service) rated about as well as DSL on speed—only middling. AT&T and Verizon charge at least $50 a month for 5GB of data; streaming just one HD movie can eat up 4GB. Each 1GB overage costs $10. Clear promises unlimited data but says it may throttle speeds on heavy users at some times.

Monthly data limits are quietly popping up on more home Internet plans. The lowest we found was 30GB per month on the Cox Starter plan. Comcast sets its cap at 250GB and says 99 percent of its residential customers use only 8 to 10GB a month. Still, be mindful of data limits, especially if you stream a lot of video online.

More than half of Consumer Reports subscribers use Internet-based phone service (including VoIP, cable, and fiber-based phone services) instead of a traditional landline. Ooma, a VoIP service, was one of the top-rated phone services of any type in our survey, and it's available nationwide. Ooma equipment is pricey, at $200 and up, but unlimited domestic calling is free (though you pay $3.50 a month in taxes) and international rates are rock-bottom.

Vonage, another highly rated national VoIP service, requires a small adapter hooked up to a phone and an Internet connection. A $12-a-month plan with 300 local and long-distance minutes and free incoming calls should suffice for many households as their home phone service.

MagicJack, which plugs into a computer's USB port and serves as a phone jack, was tops for value but had low scores for quality and reliability. It costs $40, including a year of unlimited domestic calls; an additional year costs $30. (MagicJack Plus doesn't require a computer.)

But bundling prices are complicated, and dropping phone service from a triple-play package might not save you much. Check to see whether it's worth it.

With all Internet-based phone options, including digital phone service from a cable company, you run the risk of losing service—including emergency 911 calls—if power or broadband service fails. Cable-company and fiber-based VoIP services offer battery backup, but for only 8 hours. Some services provide a free battery; others charge up to $40. Ooma, MagicJack, and Vonage don't have such backup. That might make a cell phone your only option in an emergency, provided it works at home (cell-phone 911 service is reliable, another of our surveys found).

AT&T and Verizon also offer a $5-a-month discount if you use their cellular services to replace the home phone part of a triple-play package, and $10 a month off if you bundle a cell plan and a home triple-play into a quad-play package. How long those discounts apply varies. Forty-seven percent of those with a quad-play bundle judged it to be a very good or excellent value, higher than for any other bundle we asked about.

Only about 9 percent of our readers didn't receive TV programming from a cable, satellite, or phone-company provider. If you want such service but prefer to pay less:

Go basic. The recession and the threat of online TV sources have pushed cable and satellite TV providers to offer, albeit quietly, economy TV services costing $25 to $35 for local channels and about 20 basic TV channels including CNN, E!, and Discovery but not ESPN. That might be enough for you, especially if you combine TV service with other options for getting video onto your TV set, including streaming services such as Netflix, Hulu, Vudu, and Amazon Instant Video (which we plan to cover in an upcoming survey report on alternatives to regular TV service).

Drop the DVR. Programs you often record might be available at no cost via your provider's video-on-demand (VOD) or "start over" and "view later" features, allowing you to save $6 to $20 a month.

Go back to free TV from an antenna. Over-the-air signals from ABC, CBS, NBC, and PBS are all digital and mostly HD.

Many TV providers now offer apps that let subscribers view programming on the Apple iPad, sometimes on the iPhone or iPod Touch, and occasionally on Android devices.  Some limit you to video-on-demand viewing, though others such  as Cablevision and Time Warner let you stream live TV. (Others promise live TV viewing soon.) Most also limit iPad viewing to home.

Many listed providers—and others who lack their own apps, such as Verizon FiOS—support iPad apps from partner cable networks such as HBO, Showtime, CNN, and ESPN. Whether you have paid TV service or not, you can download free mobile apps for broadcast networks such as PBS and ABC that allow iPad viewing.

A few caveats: The satellite providers require that you have an HD DVR (DirecTV) or a $99 Sling adapter (Dish) to stream video. And the data that mobile apps use, which is considerable, count against the monthly data caps from Cox and Comcast. With any provider, using your iPad or iPhone on a cellular network counts toward your wireless data cap.

*At press time a trial of live TV via the app was under way in Denver and Nashville.

Read our report on TV Everywhere for more information on apps that let you watch TV on mobile devices.

Note that for all options except regular phone service, you need a battery backup to avoid losing your phone during a power failure. Some companies provide one at no charge.

Best choices overall:
WOW
Verizon FiOS
Superior scores make FiOS or the regional carrier WOW worth serious consideration for all services if they're available in your area. Verizon scored higher than the major cable companies for TV picture, sound, and channel selection and received our highest mark for Internet speed. But you must rent a receiver for every TV, which all cable companies may not require. And FiOS had more complaints than most about bills for triple play.

The next-best choices for many households:
A highly rated cable company
AT&T U-verse
If AT&T U-verse, Bright House Networks, Cox, or Cablevision/Optimum serves your area, any is the next-best alternative to Verizon FiOS for triple-play service. Cable doesn't always require as much of an investment in special equipment, though Cablevision is among the few major companies that charge extra for battery backup so that you don't lose service in a power failure.

If TV is paramount and there's no better option for it:
DirecTV or Dish Network
The satellite-TV providers received high scores for TV picture, sound, and channel selection. But hybrid bundles combining DirecTV with DSL Internet and landline service from telephone providers were otherwise undistinguished. They had more problems than average with billing and coordinating support for the different services. With analog copper-based service, you don't need battery backup to preserve phone service during power failures. But readers were generally less satisfied with the speed of DSL Internet service than with cable. Satellite requires a dish and other equipment, usually free or discounted in exchange for a contractual commitment.