NAD sends gripes about Charter's 'cellphone Internet' label and FWA ad to the FTC

An advertising watchdog is referring complaints about Charter Communications' use of "cellphone Internet" to describe fixed wireless access (FWA), and a recent Charter ad that pokes holes in FWA service performance and reliability to the Federal Trade Commission (FTC) for review.

The National Advertising Division (NAD) said it resorted to that after "Charter declined to participate in the industry self-regulation process." The NAD then "referred the matter to the FTC and other regulatory authorities for review and possible enforcement action," according to a press release.

The overarching issues stem from a pair of challenges raised by T-Mobile. One focuses on Charter's recent characterization of FWA (the basis of T-Mobile's 5G Home Internet, or 'T-HINT' service) as "cellphone Internet," and the other on Charter's "Walls" commercial (Charter calls the ad "Holes," not "Walls"), which debuted in February during Super Bowl LVIII in local Charter markets.

T-Mobile claimed that both instances "falsely denigrated" T-Mobile's FWA-based home Internet service.

Fast-tracking of complaints  

T-Mobile used the NAD's "Fast-Track SWIFT" expedited challenge process to lodge its complaints. And that's core to why Charter withdrew from the NAD process.

Charter believes that T-Mobile's decision to seek expedited reviews on the two FWA-related challenges should be consolidated. Charter also contends that the fast-track process doesn't give the operator an opportunity to provide deeper evidence and fully defend its claims. Charter believes T-Mobile's complaints should be handled by the NAD's standard track process.

"We stand by the claims made in our Super Bowl 'Holes' ad and website about the service limitations of cellphone Internet, and we welcome the opportunity to fully defend our claims," Charter said in a statement.

Speaking at an investor conference earlier this month, Charter CEO Chris Winfrey used "cellphone Internet" to describe FWA because it uses the same cellular network as the mobile phone service. Charter contends that FWA is also subject to the same limitations as a cellphone.

"A lot of times these fixed wireless access are what we call cellphone internet, because that's really what it is. It's cell phone internet," Winfrey said. "When they're articulating that to customers, they're articulating at an incrementally low price point. But my reaction to that is the only way that you get that incrementally low price point is because you're overpaying on a mobile line."

Charter also has generally characterized FWA as an "inferior" product and likened it to "just another form of DSL."

As for the blocking issue raised by Charter's ad, the operator points to T-Mobile's own recommendation in user instructions that its FWA router be placed in a window to ease access to the nearest cell tower. Charter also points to a page about T-Mobile's Open Internet policies that makes note of potential performance issues related to the capacity of cell sites and the surrounding terrain.

Description is 'expressly false'

T-Mobile called the "cellphone Internet" characterization "expressly false, because T-HINT is not the same as internet service on current cellular phones and because T-HINT is a dedicated home internet service."

Charter's recent FWA TV spot humorously depicts a family that selected T-Mobile's FWA service, only to discover that the father in the family went to extreme measures to ensure they could get solid service by punching a gaping hole in the wall.

"Well, you know how our T-Mobile Home Internet can slow down?" the father responds to his flabbergasted wife. "Turns out, walls can get in the way." So, he "fixed it."

T-Mobile argued that the blocking allegation in Charter's ad "greatly overstates T-HINT's actual limitations."

Heated competition

The war of words has escalated in recent months as FWA has been on a tear. T-Mobile added 541,000 FWA subs in Q4 2023, ending the year with 4.8 million, and the company projects it will have 7 million to 8 million FWA subs by 2025.

Meanwhile, Charter and other cable operators have been struggling to grow broadband subs – particularly on the lower end of the market. Charter lost 61,000 broadband subs in Q4 2023.