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Bobcat79
Premium
join:2001-02-04

Maximizing revenue

Losing customers because of high prices is not necessarily bad for the cable companies. Higher rates can result in higher revenues even if some people cut the cord.

The airlines do the same thing -- Adjust prices to maximize revenue, not to maximum the number of passengers.


Karl Bode
News Guy
join:2000-03-02
kudos:42

1 recommendation

Yep. Comcast tried to maximize the total number of passengers and wound up with a customer support nightmare from growing too fast. Now they're trying to cash in on the most expensive customers (average video Comcast customer now pays 10% more: $130 a month).

Still, that doesn't mean they're not ignoring a new trend caused by their own bi-annual rate hikes in order to keep stocks stable.

travelguy

join:1999-09-03
Santa Fe, NM
reply to Bobcat79
It doesn't maximize your total revenue, but it does make your average revenue go up, which in turn makes your business look more profitable on a per customer basis.