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). The implied claims are that a consumer will save up to 50 percent 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.
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.
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