TigerNutz
Laissez les bons temps rouler
Premium
join:2000-12-23
Little Rock, AR
 ·AT&T U-Verse
 ·AT&T Yahoo
·AT&T Southwest
 ·Cox HSI
|  Well isn't that peachy
Someone xplain this to me, when the economy is deep in the toilet why would a company raise rates?
Makes no sense but it is AT$T we are talking about here.... 
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Better living through modern chemistry. |
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KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK
·AT&T Yahoo
·AT&T DSL Service
·Cox HSI
·AT&T Southwest
| Lack of competition. Because they can... and because the economy is hurting their stock prices, and so they want to prop up the prices with extra revenue.... so they raise prices to consumers.
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"Fascism should more properly be called corporatism because it is the merger of state and corporate power." -- Benito Mussolini
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fiberguy
My views are my own.
Premium
join:2005-05-20
| reply to TigerNutz
said by TigerNutz  :Someone xplain this to me, when the economy is deep in the toilet why would a company raise rates? Makes no sense but it is AT$T we are talking about here.... Do the math...
They do a small price increase across the board to all affected customers. The gain from that price increase will offset any loss of customers that ditch the service for another provider.
Not everyone will leave and not everyone will cut but; not enough to even offset the increased sales. In an economic downturn, more people are going to stay home and entertain there rather than go out and spend money. The gamble of raising prices in a slow economy is a good one for any business in this position, actually.
Further, for every customer that DOES drop, that's just that many less customers they will likely have to support as well.
To be honest, its a win win for both cable and telephone. Where you will see a sign of trouble is when deep discounts come out to NEW customers only, not existing customers. |
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