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Fixed Wireless Access (FWA)

Ad watchdog shoots down T-Mobile's home Internet price claims

T-Mobile's fight for home broadband market share has again spilled over into the world of advertising. Though T-Mobile has been winning the broadband subscriber fight in recent quarters, it came out on the losing end in a skirmish sparked by rival Charter Communications.

The National Advertising Division (NAD) recommended this week that T-Mobile halt claims that consumers can "save up to 50% vs. National FCC Broadband Rate Benchmark" with T-Mobile Home Internet, the company's fixed wireless access (FWA) service. T-Mobile used that price claim in television commercials and website ads to compare its service to the FCC Rate Benchmark, which surveys fixed voice and broadband service rates offered in urban areas. Charter lodged a complaint about the claim with NAD.

NAD, an ad watchdog linked to the Better Business Bureau, argued that T-Mobile's claim isn't clear and is open to interpretation and context and, in general, is a bad fit for T-Mobile's challenged savings claim. The implied claim, NAD added, "reasonably conveys" that consumers can save up to 50% with T-Mobile's home Internet service versus the same or comparable service level from other broadband providers, including Charter.

"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," the organization stated. "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 said T-Mobile agreed to comply with NAD's recommendations, but "expressed disagreement with certain of NAD's findings regarding the FCC Broadband Rate Benchmark."

Ad disputes mount

Such battles over advertising claims have become commonplace in the competitive broadband arena. In fact, Charter and T-Mobile were also involved in a different ad dispute involving T-Mobile Home Internet that was resolved in March.

T-Mobile fared better there, with NAD finding that the company's "no data caps" claim for its Home Internet service was not misleading, and that T-Mobile's advertising about the service "did not reasonably convey a disparaging message that competing cable internet providers," including Charter, require long-term contracts and exploding bills, as compared to T-Mobile's Home Internet service.

However, NAD did recommend that T-Mobile discontinue claims that its home Internet service delivers consistent speeds of 100 Mbit/s or more, or modify them to "provide truthful and accurate information about the speed or range of speeds that its customers can consistently experience."

Broadband subscriber battle rages

Those advertising-related battles are also a clear indicator that T-Mobile's FWA offering is getting under the skin of Charter in the broadband arena.

In the second quarter of 2022, T-Mobile added 560,000 high-speed Internet customers, for a total of more than 1.5 million. Charter, meanwhile, lost 42,000 residential broadband subs in the period, but added 344,000 mobile lines (329,000 residential lines and 15,000 business lines) in the period.

Cable's success in mobile has likewise grabbed the attention of T-Mobile. In a complaint initiated by T-Mobile, NAD late last year recommended that Comcast stop using certain "Unlimited 5G" and "best price" claims for its Xfinity Mobile service 5G plans.

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— Jeff Baumgartner, Senior Editor, Light Reading

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