Cable One CEO Thomas Might boasted to investors that his company pulled down prospective customers' FICO scores and used them to determine the kind of service they'd extend to them, with "hollow value" customers (those with poor credit) getting less service.
"Hollow score" customers didn't get help setting up Cable One's apps or other kinds of customer service.
Cable One CEO Thomas Might told analysts at the JP Morgan Conference that since they started "qualifying" customers with FICO credit scores, bad debt declined by 70%. That's very good for the company. Mind you, because the targeting of customers with low FICO credit scores is predictive, this invariably meant that some potentially "good" customers got flushed out with the "hollow value" customers. But companies don't worry about fairness to customers. They worry about profit maximization. The loss of marginal income from those customers with low FICO credit scores that would have consistently paid on time is more than made up for in the savings from the "hollow value" customers with low FICO scores that Cable One pushed off its network and cut cost of service.
Given the profitability of Cable One's "qualifying" scheme, it seems very likely to spread through the industry (assuming it hasn't already, since we have no way of knowing unless another company CEO starts to brag about using customer data to screw them over). Why shouldn't other broadband providers use customer information customers have no choice about providing to determine whether to "waste time" providing them with real customer service? It maximizes profit, and it's not against the law. Don't broadband operators have a responsibility to their shareholders to use customer data to discriminate like this? Sure, it may hurt people of color, the unemployed, or the millions of people who have low FICO scores by mistake. But broadband providers are profit maximizing businesses — not charities or social justice warriors. As long as it's not against the law, aren't broadband providers obligated to their shareholders to maximize revenue and discriminate against potentially "hollow value" customers?
Broadband Privacy Can Prevent Discrimination, The Case of Cable One and FICO Scores.
[Harold Feld/Wet Machine]
(via Super Punch)