Four costly mistakes to avoid when switching cable providers

Thinking about switching cable providers? Before you sign a new contract, take a look at which common pitfalls you should avoid.

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Mistakes when switching cable providers
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Mistakes when switching cable providers

It's not surprising that so many people have love-hate relationships with their cable TV packages. On one hand, cable gives them access to can't-miss shows, exciting live sports coverage, and the premium programming that everyone is discussing.

Then there's the other side to cable: the confusing menu of services, the high monthly bills, and the contract terms that can throw you for a serious loop.

But, when done correctly, you can find a happy medium with your cable provider in terms of service and costs. To start, you'll want to avoid these mistakes when signing up for cable…

#1 - Ignoring the Details of Your Contract

Although cable providers should always explain the conditions of your agreement, consumers should always be proactive about asking questions and making sure they have a good understanding of the contract terms, says Brian Dietz, spokesperson for the National Cable & Telecommunications Association (NCTA).

So what should you look out for when going over your contract?

Commitment Period: "As a rule, avoid contracts if possible because they limit your ability to switch providers or negotiate rates. You may also face a termination fee of several hundred dollars if you want to get out of your contract early," notes a 2011 Consumer Reports Magazine piece on bundling and bargaining.

Expiration Date for Promotional Discounts: Many cable companies offer special rates at the beginning of your contract, says consumer advocate and editor of the consumer advocacy publication, ctwatchdog.com, George Gombossy.

For that reason, he  suggests becoming familiar with the terms of any introductory offers that come with your new plan. Otherwise, you'll be caught off guard when these promotional offers end and your bill suddenly increases.

What's more, if you're familiar with the introductory terms, Gombossy notes that you can get in touch with the cable company to extend these favorable rates before they expire.

[Ready to shop around and find the right cable package for you? Click to compare rates now.]

#2 - Not Asking About the Cheapest or Unadvertised Cable Packages

Do you tend to watch the same standard channels every time you turn on your TV? If so, it can pay to double-check with cable companies regarding their most basic offerings and any unadvertised cable packages.

The Utility Consumers' Action Network (UCAN) points out that some of the more bare-bones packages aren't always advertised on your cable company's menu of services. These packages usually only include 20 to 25 channels and they tend to be the most affordable choices.

For example, COX TV provides a "TV economy" package that's priced at around $35 a month and includes channels like AMC, National Geographic, CNN, E! and Nickelodeon, among others.

In general, don't be afraid to ask questions about packages that aren't initially offered to you. You may end up discovering an option that is the perfect fit for your viewing preferences - and for your budget.

[Click to find the right cable TV package for you.]

#3 - Thinking Companies Offer the Same Rates and Services

If you think you know what the lowest rate for cable is, think again. Cable providers are at different ends of the spectrum in terms of their rates and services offered.

That's why Dietz says, "Consumers should always shop around for the product or service they feel best meets their needs."

To show you what Dietz means, here's a look at current cable packages and rates offered by two providers*:

Comcast Xfinity: "Digital Starter" package includes 80+ channels including MTV, CNN, and ESPN for $29.99 (for the first 12 months with a 2-year agreement).

Time Warner Cable: "Basic TV" package includes 20+ channels and a variety of HDTV channels, local news and weather channels, for $22.75 per month.

As you can see, while these are the lowest advertised cable packages for each provider, the prices and channel lineup vary. With Comcast’s “Digital Starter” package, you’ll receive 60 additional channels, but will have to pay $7.24 more a month than the “Basic TV” package from Time Warner Cable.

So, if you're lucky and live in an area with numerous providers to choose from, you can compare rates and services and go with the one that matches your needs. Of course, depending on where you live, you may unfortunately be restricted to only one cable provider. If this is the case, take a look at the negotiation tactics below.

[Click to compare rates and packages from providers in your area.]

#4 - Being Afraid to Negotiate

While you're asking about special packages, you may as well take your efforts a step further by trying to negotiate a better deal than the one your cable company first quotes you.

To start, Gombossy recommends getting quotes for similar television services offered by satellite companies. If those prices are lower than what you're currently quoted, you can take those competitive prices back to your cable company and use them as bargaining tools.

Rashad Dacus, 31, of Omaha, Nebraska, took advantage of this exact tactic when he was negotiating for a better deal than his cable provider originally quoted. When he came back to his cable company with lower price quotes from satellite providers, he was able to knock $5 off his monthly bill and add DVR services to his package.

Dacus says that even if you're nervous about negotiating, he recommends "just picking up the phone and calling your provider." You have nothing to lose and you may be surprised at the great deals you can secure by simply asking.

*Packages and rates available on the Comcast and Time Warner Cable websites on April 15, 2013.

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