ASA Adjudication on Orange Personal Communications Services Ltd

Ad

A national press ad, for the Orange Home Max package, stated "save over £190 when you switch from BT It's easy to switch over and you can keep your existing phone number. Wireless broadband and home phone package from Orange, just £24 a month. With Home Max you get line rental included in the price so there's no need to pay BT - worth over £10 a month wireless broadband with speeds of up to 8 meg* a home phone package with inclusive calls to UK landlines at evenings and weekends from home plus inclusive calls to 30 countries and Orange mobiles via the Livebox wireless modem for great home packages call ... ". Small-print at the foot of the ad stated "Savings claim of over £190 based on standard cost of Orange Home Max wireless broadband and phone line package, £24 a month over 18 months (total of £432) and BT's standard published pricing as at 4.12.2007 for BT Broadband Option 3 and BT Together Calling Plan Option 2 over 18 months; broadband first six months at lower price of £18.99 a month (total of £113.94), plus broadband for remaining 12 months at higher price of £24.99 a month (total of £299.88), plus evening and weekend call package free for first twelve months, then £3.45 a month (total of £20.70), plus line rental at £10.50 a month, (total of £189) making BT package cost (total of £623.52)."

Issue

British Telecommunications plc (BT) challenged whether the savings claim which was based on a comparison of the Orange Home Max and two BT packages was misleading, because it failed to take into account features which were included in the BT packages which were either not available for Orange customers or for which they were required to pay extra.  These features included a handset (the BT Home Hub phone), Evening and Weekend internet calls package, full Norton Security suite and unlimited inclusive wi-fi minutes in BT Fon hotspots.

CAP Code (Edition 11)

Response

Orange Personal Communications Services (Orange) disagreed that the ad was misleading and believed the comparison, which was made against BT's most comparable services, BT Total Broadband Option 3 and BT Together Calling Plan Option 2, was both clear and fair.  They said the comparison was based on those elements of the packages they believed consumers were most likely to compare: the monthly price of the broadband and Home Phone package; broadband speed; usage allowance; inclusive calls on the main line or a second line and a wireless router.  Orange pointed out both packages offered broadband speeds of up to 8 mb and were unlimited, with a fair usage policy.  Both packages also offered inclusive calls and a wireless router.

They said those characteristics were the main features that all telecommunications providers focused on in their advertising and pointed out that there were other features that providers did not always communicate to consumers.  Orange believed those features did not therefore play a part in influencing consumers' decisions about which package to choose.  They argued that they could have claimed higher savings had they included other features of the Home Max package in the comparison.

Orange considered that the differences identified by BT were not sufficiently significant to influence a consumer's decision about which package to choose.  In relation to the handset provided with the BT package, they said the Orange Livebox, the wireless modem that enabled calls to be made over the internet, worked with any normal wired handset which they believed most consumers were likely to already own.  They added that Digital Enhanced Cordless Telecommunications (DECT) handsets were available from £9.99.  Orange advised that the Home Max package included internet calls; 'anytime' calls were available on the second line Voice Over Internet Protocol (VOIP) service.  They considered that this feature of the Home Max package improved on the service offered by BT.  Orange did not regard the differences in the security packages and the provision of unlimited wi-fi minutes as significant differences that would influence consumer decision-making.

Assessment

Upheld

The ASA noted Orange believed they had made a clear and fair comparison between their Home Max package and BT's most similar packages, BT Total Broadband Option 3 and BT Together Calling Plan Option 2.  We accepted that Orange had used BT's most comparable services to form the basis of the comparison and noted the footnote explained how the £190 savings claim had been calculated.  We noted they had selected for comparison those elements of the package that they believed consumers were most likely to compare.  We also noted the reasons why Orange thought the key differences between the packages, identified by BT, were not sufficiently significant to warrant inclusion in the comparison.

The CAP Help Note on Price Claims in Telecommunications Marketing stated that marketers should assume that consumers act rationally in selecting the best service available and marketers should compare their service with the competitor's most comparable service and should name clearly the services that form the basis of comparison.  We also noted the Help Note stated marketers should state differences between services undergoing comparison that were likely to influence consumers' evaluation of that comparison.

We noted the ad was addressed to BT customers and advised them they could save money if they switched to Orange.  In particular the ad addressed those BT customers who had BT Total Broadband Option 3 and BT Together Calling Plan Option 2 and specifically stated that they could save over £190.  We considered that as the ad was so specific and highlighted the significant features those BT customers would gain by switching to Orange (e.g. over £190 savings, inclusive calls to 30 countries and Orange mobiles via the Livebox wireless modem) it should also have highlighted those significant features which those BT customers would lose by making a switch.

We considered the differences highlighted by BT.  We noted both packages offered inclusive internet calls and that Oranges Home Max package offered anytime calls to UK landlines via the internet whereas BT Broadband Option 3 offered evening and weekend calls to UK landlines via the internet.  We considered that those BT customers would not lose out in this respect if they switched to Orange.

We understood that internet calls could be made via the Orange Livebox modem using a normal telephone handset whereas BT Broadband Option 3 customers could make internet calls via the BT Home Hub using their BT Home Hub phone which was included in their package.  We noted that the BT Home Hub phone connected wirelessly to the BT Home Hub and considered that it was a significant feature that those BT customers would lose by switching to Orange.

We noted that Orange Home Max offered McAfee privacy whereas BT Broadband Option 3 offered enhanced Norton Security which included Norton AntiVirus and Norton Personal Firewall.  We considered the security package offered by BT was more advanced and that it was a significant feature that those BT customers would lose by switching to Orange.

We noted that BT Broadband Option 3 offered unlimited inclusive wi-fi minutes in BT Fon hotspots and that Orange Home Max did not offer a comparable service.  We therefore considered that this was a significant feature that those BT customers would lose by switching to Orange.

We concluded that three of the four features outlined by BT (the BT Home Hub phone, full Norton Security suite and unlimited inclusive wi-fi minutes in BT Fon hotspots) were significant differences between the services that were likely to influence consumers' evaluation of the comparison and therefore should have been included in the ad.  We considered that these differences should have been stated prominently in order to ensure those BT customers to whom the ad was addressed could make a fair comparison of the packages before deciding whether to switch.

The ad breached CAP Code clauses 7.1 (Truthfulness), 18.1 and 18.3 (Comparisons with identified competitors and/or their products).  We also investigated under 3.1 (Substantiation) and 18.2 (Comparisons with identified competitors and/or their products) but did not find it in breach.

Action

We told Orange to amend the ad and to ensure that the significant differences highlighted were stated prominently.  We reminded Orange that ads should include any differences in packages under comparison likely to influence consumers evaluation of that comparison and that significant conditions should be stated prominently.  We advised them to seek guidance from the CAP Copy Advice team for the amendments.

Adjudication of the ASA Council (Non-broadcast)