NAD Recommends T-Mobile Modify or Discontinue Certain Network Speed Claims Following Challenge by AT&T; Finds T-Mobile Could Support ‘Coast-to-Coast’ Coverage Claims

New York, NY – Sept. 17, 2013 – The National Advertising Division has recommended that T-Mobile USA, Inc., modify or discontinue certain comparative network speed claims, following a challenge by AT&T Services, Inc.

NAD is an investigative unit of the advertising industry’s system of self-regulation. It is administered by the Council of Better Business Bureaus.

AT&T contended that T-Mobile’s recent advertising campaigns are specifically targeted at AT&T, and mislead consumers about several comparative attributes of AT&T and T-Mobile’s 4G networks including their speed and consistency, coverage area, and call quality.

T-Mobile argued that its advertising campaign is intended to convey the truthful message that AT&T’s network has been and continues to be overstretched and oversubscribed which impacts the consistency of AT&T’s network speed. T-Mobile also argued that its call quality claim was fully supported and that its coverage maps and coast-to-coast coverage claims were truthful.

• The advertiser advised NAD in writing that it had permanently discontinued claims that:
• T-Mobile’s 4G network is faster than AT&T’s nationwide 4G Network.
• AT&T’s most widely used smartphone runs up to 70% faster on T-Mobile’s network.
• T-Mobile’s “Helicopter” commercial.

NAD’s inquiry focused on the following claims:

• T-Mobile “has 50% more bandwidth than AT&T.”
• “Most Advanced Technology”
• “Faster 4G Service”
• T-Mobile’s 4G Coverage maps
• T-Mobile  offers “coast to coast” 4G coverage
• “Our superfast 4G network reaches more than 220 million Americans coast to coast, which means amazing 4G experiences in all the places that matter most to you.”
• “T-Mobile has you covered like nobody else.”
• T-Mobile “provides better call quality than AT&T.”

A key issue before NAD was T-Mobile’s 50% more bandwidth claim and comparative analysis of the impact of “congestion” on the speeds experienced by consumers.

T-Mobile’s speed and bandwidth claims were based on T-Mobile’s analysis of peak-period and non-peak period download speeds available across the T-Mobile’s UMTS (Universal Mobile Telecommunications System), HSPA and HSPA+ network, compared to AT&T.

NAD did find that T-Mobile’s evidence demonstrated that T-Mobile’s  UMTS, (Universal Mobile Telecommunications System),  HSPA and HSPA+ network was less likely to slow down due to congestion than AT&T’s  UMTS, HSPA and HSPA+ network, based on its comparison of peak and non-peak period download speeds.

However, NAD determined that the analysis was flawed because it did not include AT&T’s LTE (Long Term Evolution Network). As a result, NAD concluded that there was insufficient evidence that AT&T’s combined network, including LTE is likely to be slowed by congestion than T-Mobile’s.  Accordingly NAD    recommended that the advertiser discontinue its unqualified “more bandwidth” and “less congestion” claims.

Alternatively,  NAD recommended T-Mobile modify any comparative network superiority claims to disclose meaningful information to consumers regarding the circumstances under which users can expect to experience any superior performance, including, if possible, the types of phones, locations and/or situations where customers may experience a performance advantage.

NAD recommended that the advertiser discontinue its “Most Advanced Technology” and “Faster 4G Service” claims or modify the claims to state the basis for comparison.

NAD determined that the advertiser’s “Coast-to-Coast” coverage claims were appropriately substantiated and its claim, “T-Mobile has you covered like nobody else” was permissible puffery.  NAD recommended, however, that T-Mobile discontinue the use of its coverage maps in conjunction with 4G or 4G LTE coverage claims.

Finally, NAD recommended that T-Mobile discontinue its overly broad “Call Quality” claim or modify it to better conform to the Nielsen test results on which it was based, which NAD concluded would support a claim for better “audio or voice quality.”

T-Mobile, in its advertiser’s statement, said the company believes its advertisements already communicate its “network advantages clearly, but will take into consideration the concerns NAD expressed with respect to the clarity of certain of these advertising claims in formulating its future advertising.”