National Advertising Division Finds T-Mobile Home Internet Availability Claim Supported, but Recommends “Save Up to 50%” Claim be Discontinued
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New York, NY – August 18, 2022 – The National Advertising Division (NAD) of BBB National Programs determined that T-Mobile US, Inc. provided a reasonable basis for the claim that its T Mobile Home Internet (T-HINT) is “available to many households in most U.S. cities and towns” and the implied claim that T-HINT is available broadly nationwide.
However, NAD recommended that T-Mobile discontinue the claim that consumers can “save up to 50% vs. National FCC Broadband Rate Benchmark” with T-HINT, and the implied claim that a consumer will save up to 50% on their home internet services versus major competitors like Verizon.
T-HINT is a new broadband alternative to cable home internet. The claims at issue were challenged by Verizon Communications, Inc.
In the challenged television commercial, the claim “introducing T-Mobile home internet” appeared with a disclosure at the bottom of the screen in the same frame that reads: “Available to many households in most U.S. cities and towns. Details at T-Mobile.com/WiFi.”
NAD concluded that T-HINT service is now more available than unavailable to U.S. consumers nationally. Accordingly, NAD determined that the advertiser had a reasonable basis for the claim that T-HINT is “available to many households in most U.S. cities and towns,” and the implied claim that T-HINT is available broadly nationwide.
“Save Up to 50%” Claim
In the challenged television commercial, a computer screen is shown on which the words “Save Up to 50% vs. National FCC Broadband Rate Benchmark” were written. “Save Up to 50%” was written in bold lettering and the comparison to the FCC Broadband Rate Benchmark appears in smaller font underneath. In the same frame, a disclosure appeared on the bottom of the screen. It read: “$105/mo. (FCC Urban Broadband Rate Survey Reasonable Comparability Benchmark) vs. $50/mo. (T-Mobile 5G Home Internet). Speeds & features vary.”
NAD determined that the basis of comparison for T-Mobile’s “save up to 50%” claim (i.e., the National FCC Broadband Rate Benchmark) is not clear because the claim appears on screen for two seconds and the term “benchmark” is open to interpretation in this context. NAD found that one reasonable interpretation of the term “benchmark” is that the benchmark rate is an average rate paid by Americans for home internet service. However, the Urban Rate Survey does not represent the actual price that any consumers pay, but rather is a benchmark rate set by the FCC to ensure equitable pricing for rural areas. NAD noted that while the Urban Rate Survey may reliably collect internet service rate data for the purpose of informing public policy, the benchmark rate derived from this survey is not a good fit for the challenged savings claim.
NAD also determined that the “Up to 50%” savings claim is unsupported because few consumers are paying the $105 a month that T-Mobile uses as its basis for comparison from the FCC’s benchmark rates.
In addition, NAD found that the FCC Rate Benchmark comparison is not a good fit for the savings claim because it was not established to NAD’s satisfaction that the service tier T-Mobile selected as the basis for comparison was appropriate.
For these reasons, NAD recommended that T-Mobile discontinue the “save up to 50%” claim and the implied claim that a consumer will save up to 50% on their home internet services versus major competitors like Verizon.
In its advertiser statement, T-Mobile stated that it “agrees to comply with NAD’s recommendations.” Although the advertiser expressed disagreement with certain of NAD’s findings regarding the FCC Broadband Rate Benchmark it stated that “we remain a supporter of the self-regulatory process and will take NAD’s recommendations into account in future advertising.”
All BBB National Programs case decision summaries can be found in the case decision library. For the full text of NAD, NARB, and CARU decisions, subscribe to the online archive.
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