ASA Adjudication on Telecom Plus plc

Ad

Two leaflets for telephony services from The Utility Warehouse.

a. The first leaflet was headlined "The more services you take ... the more money you save!". Text inside stated "just think ... save money on all your utilities ... Introduction to Broadcall ... Look how much you could save in your first year!" A table underneath stated "Our service compared to BT Option 1 … 'LLU' Customers save £212.40 … 'Non-LLU' Customers save £116.40". Text on the following page stated "The call part of BroadCall ... Calls to our top 50 international destinations cost just 5p per minute at any time of day - that's up to 93% less than the cheapest price available from BT. The table below illustrates the savings you will make on a typical 10-minute peak call ... Destination ... Taiwan ... BT Together £7.00 ... Broadcall 52p ... You Save 93%". The back of the leaflet stated "SAVINGS FOR EVERYONE".

b. The second leaflet was entitled "Tariff Booklet". Text inside stated "Home Phone Line Rental and Value Calling Features Standard residential line rental costs just £11 per month, saving you up to £12 p.a. compared with BT. We also offer a range of great value calling features on all phone lines which have been transferred to us, at just £1 each per month - a saving of up to 42% compared with BT! Caller Display: Shows the telephone number of the person calling you ...". The ad went on to list several other services. The back of the leaflet stated "SAVINGS FOR EVERYONE".

Issue

British Telecommunications plc (BT) challenged whether:

1. The Utility Warehouse could substantiate the savings claims of £212.40 and £116.40 for Broadcall in ad (a);

2. the claim "that's up to 93% less than the cheapest price available from BT" in ad (a) was misleading and an unfair comparison, because they believed The Utility Warehouse had used BT's most expensive rate for calls to Taiwan to support the claim;

3. the claim "Standard residential line rental costs just £11 per month, saving you up to £12 p.a. compared with BT" in ad (b) was misleading and an unfair comparison, because they believed Telecom Plus charged 10% extra for customers who did not pay by direct debit, which brought their price in line with BT's and

4. the claim "We also offer a range of great value calling features on all phone lines which have been transferred to us, at just £1 each per month - a saving of up to 42% compared with BT!" in ad (b) was misleading and an unfair comparison, because they offered caller display services at no additional cost and believed an absolute comparison could therefore not be made.

5. The ASA challenged whether The Utility Warehouse could substantiate the claims "SAVINGS FOR EVERYONE" in both ads and "save money on all your utilities" in ad (a).

CAP Code (Edition 11)

Response

The Utility Warehouse argued that all the claims were accurate at the time the leaflets were created and that the date of the comparisons was clearly stated. They asserted that, if any of the data was out of date, it would be reviewed and corrected when they reprinted their leaflets. They did not comment specifically on any of the points of complaint or send the ASA any evidence to support their claims.

Assessment

1., 2., 3., 4. & 5. Upheld

The ASA considered that, because we had not seen evidence to support any of the challenged claims, the ad was misleading.

On point 1, the ad breached CAP code clauses 3.1 (Substantiation), 7.1 (Truthfulness), 18.1 and 18.3 (Comparisons with identified competitors and/or their products).

On points 2, 3 & 4, the ads breached CAP Code clauses 3.1 (Substantiation), 7.1 (Truthfulness), 18.1, 18.2 and 18.3 (Comparisons with identified competitors and/or their products).

On point 5, the ads breached CAP Code clauses 3.1 (Substantiation) and 7.1 (Truthfulness).

Action

We told The Utility Warehouse not to use the claims again without substantiating evidence, which should be sent to us on request. We reminded them that they should ensure all comparisons were fair.

Adjudication of the ASA Council (Non-broadcast)