At Your Service
The group reports, "One thing that frustrates our panel is the continued pushing of warranties by salespeople that make up categories of bogus product failures that you are supposed to worry about, such as LCD pixel burn-out, CD and DVD player laser alignment, projection TV misalignment, power-supply burn out, etc. Our experts tell us these are mostly made-up malfunctions used to scare you into buying extended warranties."
However, as manufacturers' own warranties get shorter and shorter, consumers become more receptive to extended service contracts.
There is light at the end of the service plan tunnel, however. Mann says, "Beyond the profitability inherent in warranty sales, customers enjoy the security. Buying expensive new technology items like plasma television, sophisticated appliances or DVD recorders becomes less daunting if the consumer knows that potential problems will be handled for many years, even after the manufacturer warranty expires."