National Advertising Division Recommends T-Mobile Discontinue Claims that Consumers Can "Save Up to 50%" with T-Mobile Home Internet

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Aug 18, 2022, 11:00 ET

NEW YORK, Aug. 18, 2022 /PRNewswire/ -- The National Advertising Division (NAD) of BBB National Programs recommended that T-Mobile US, Inc. discontinue claims that consumers can "save up to 50% vs. National FCC Broadband Rate Benchmark" with T-Mobile Home Internet (T-HINT) and the implied claims that a consumer will save up to 50% if they purchase T-Mobile internet versus the same or a comparable service level of internet from other providers (including the challenger, Charter Communications, Inc.).

T-HINT is a new broadband alternative to cable home internet.

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 appeared in smaller font underneath. In the same frame, a disclosure appeared on the bottom of the screen. It reads: "vs. National FCC Rate Benchmark."

Similar claims appear on T-Mobile's website. Those claims are accompanied by some variation of a disclosure stating that the savings are "[c]ompared to the 2022 FCC Urban Rate Survey – Fixed Broadband Service Reasonable Comparability Benchmark. $105/mo (FCC Benchmark) vs. $50/mo w/AutoPay (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 in the challenged television commercial because the claim appears on screen for two seconds and the term "benchmark" is open to interpretation in this context. NAD found that even if the consumer read the entire claim, 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 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.

Further, NAD concluded that the advertising reasonably conveys the implied claims that consumers will save up to 50% if they purchase T-Mobile internet versus the same or a comparable service level of internet from other providers, including Charter. NAD noted that the advertising appears in a context where the advertised savings are presented as a comparison against actual prices offered in the marketplace, however, T-Mobile did not demonstrate that consumers switching to T-HINT will realize such savings.

For these reasons, NAD recommended that T-Mobile discontinue the claims:

"Save Up to 50% vs. National FCC Broadband Rate Benchmark" *"$105/mo (FCC Urban Broadband Rate Survey Reasonable Comparability Benchmark) vs. $50/mo (T-Mobile 5G Home Internet)."
"Save Up To 50% with T-Mobile Home Internet. Internet bills have you feeling mistreated? Get happy with T-Mobile Home Internet. Save up to 50% compared to the FCC benchmark."
"Save Up To 50% compared to 2021 FCC Urban Rate Survey Reasonable Comparability Benchmark," and "Save Up To 50% Compared to 2022 FCC Urban Rate Survey – Fixed Broadband Service Reasonable Comparison Benchmark. $105/mo w/AutoPay (T-Mobile 5G Home Internet)."
And the implied claims that consumers will save up to 50% if they purchase T-Mobile internet versus the same or a comparable service level of internet from other providers (including Charter).

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.

About BBB National Programs: BBB National Programs is where businesses turn to enhance consumer trust and consumers are heard. The non-profit organization creates a fairer playing field for businesses and a better experience for consumers through the development and delivery of effective third-party accountability and dispute resolution programs. Embracing its role as an independent organization since the restructuring of the Council of Better Business Bureaus in June 2019, BBB National Programs today oversees more than a dozen leading national industry self-regulation programs, and continues to evolve its work and grow its impact by providing business guidance and fostering best practices in arenas such as advertising, child-directed marketing, and privacy. To learn more, visit bbbprograms.org.

About the National Advertising Division: The National Advertising Division (NAD) of BBB National Programs provides independent self-regulation and dispute resolution services, guiding the truthfulness of advertising across the U.S. NAD reviews national advertising in all media and its decisions set consistent standards for advertising truth and accuracy, delivering meaningful protection to consumers and leveling the playing field for business.  

SOURCE BBB National Programs