ASA Adjudication on Virgin Media Ltd
Virgin Media Ltd
Bartley Wood Business Park
18 July 2012
Direct mail, Internet (on own site), Television
Number of complaints:
Summary of Council decision:
Three issues were investigated of which two were Upheld and one was Not Upheld.
A TV ad, circular and claims on a website, for the TiVo service from Virgin Media, viewed in October 2011:
a. Text within the circular stated "Free TiVo® Box activation for new and existing customers". Further text stated "Free TiVo box activation TV, broadband and calls. Pick 2 or 3. Prices from just £9.50 a month". Text within the footnote stated "Standard installation fee ... required".
b. Text on the 'Digital TV' page stated "Free TiVo® The activation's on us, saving you £49.95 TiVo bundles from £9.50 Plus free installation*". The asterisk linked to a footnote which stated "*Free installation for new customers signing up online". Further text stated "Free TiVo box activation worth £49.95 Free installation worth £49.95*". The asterisk linked to a footnote which stated "*Free installation for new customers signing up online". Text on the 'Upgrade to a TiVo box' page stated "Upgrade now and you can get our 500GB box with free activation worth £49.95*". The asterisk linked to a footnote which stated "Installation fee of £49.95 applies ... ".
c. The TV ad featured on-screen text which stated "Free TiVo box activation for everyone ... ". The on-screen text was accompanied by a voice-over which stated: "With free TiVo box activation for everyone and TV bundles from just £9.50 a month, there's never been a better time to call". The footnote stated "Installation fee applies. Details at virginmedia.com".
1. British Sky Broadcasting (Sky) and nine members of the public challenged whether the references to "Free TiVo Box activation" were misleading and could be substantiated.
2. Seven complainants challenged whether the ads were misleading, because they failed to make clear that an installation fee of £49.95 applied.
3. Three complainants also challenged whether the ads were misleading, because they failed to make clear that a £3 monthly charge applied.
CAP Code (Edition 12)
1. Virgin said the installation fee related to the process by which their services were connected to their customers' homes and that the fee applied to all packages. They said the TiVo activation fee specifically related to the TiVo box and that there was a significant amount of work involved in the set up process.
Virgin said as at 1 July 2011, new customers taking the M+, L or XL TV pack with TiVo were required to pay a monthly fee of £3 for the TiVo service and an activation fee of £49.95. However, they said as at 1 October 2011, new customers taking the same package were required to pay a monthly fee of £3 for the TiVo service, but no activation fee applied. They therefore believed the price of the TiVo bundle had not increased and that the quality or composition of the elements that were already included in the TiVo bundle had not been reduced as a result of the addition of the free activation. They believed under CAP guidance they were entitled to call the TiVo box activation "free" for a certain period of time, before consumers would consider it included. They also said as at 11 May 2011 an installation fee of £40 applied, but that with effect from 29 September 2011, the fee was increased to £49.95.
Clearcast said the ad made clear that free activation applied to the 500GB TiVo box and that the terms and conditions indicated that for subsequent boxes an activation fee of £49.95 applied. They therefore believed the “free” claim had been substantiated.
2. Virgin said both the TV ad and circular made clear that a standard installation fee applied. They said the online ads made clear that installation was free when purchased online.
Clearcast said the claim “free TiVo box activation for everyone” appeared twice in the ad and was accompanied by a footnote which made clear that an installation fee applied.
3. Virgin said the £9.50 starting price stated in the ads included the £3 monthly TiVo charge. They said the circular stated "now including TiVo" and the corresponding prices included the TiVo monthly charge. They therefore considered it was not necessary to state the TiVo monthly charge separately within the body copy.
Clearcast said it was not drawn to their attention that a £3 monthly charge applied. They said for that reason the monthly charge was not included in a footnote. However, they believed such a footnote should have been included in the ad.
The ASA noted the CAP Code made clear that an element of a package must not be described as “free” if it was included in the package price unless consumers were likely to regard it as an additional benefit because it had recently been added to the package without increasing its price.
We considered the TiVo activation fee and TiVo monthly charge to be a bundled service (the TiVo bundle), because a consumer could not use the TiVo box without paying the activation fee.
We understood that prior to the ads appearing, consumers were able to select a package comprising of TV, broadband and a telephone service and that an installation fee was inherent to all Virgin Media packages. We also understood that consumers were able to select a TiVo bundle, which incurred an activation fee of £49.95 and a monthly fee of £3, in addition to their chosen package.
We noted the prices quoted in the ads included the £3 monthly TiVo charge and promoted the benefits of the TiVo service. We therefore considered the ads promoted packages that included various combinations of TV, broadband and telephone services with TiVo. We understood that previously all new subscribers had paid an installation fee and, for the TiVo bundle, a monthly charge for TiVo and a TiVo activation fee, whereas from 1 October 2011 they paid an installation fee, a monthly TiVo charge and no activation fee. We were therefore concerned that the addition of TiVo box activation to the package was not a new additional benefit; rather it was an existing element of a bundle that included TiVo and had been subject to a price reduction.
On that basis, we concluded the references to "Free TiVo Box activation" breached the Code.
On this point, ads (a) and (b) breached CAP Code (Edition 12) rules 3.1 (Misleading advertising), 3.7 (Substantiation) and 3.25 (Free) and ad (c) breached BCAP Code rules 3.1 (Misleading advertising), 3.9 (Substantiation) and 3.26 (Free).
2. Upheld (in relation to ads (a) and (c) only)
We noted the footnote within ad (a) stated "Standard installation fee ... required" and that references within the TV ad (ad (c)), to “free TiVo box activation” were accompanied by on-screen text which stated "Installation fee applies". Whilst we acknowledged the ads made clear the existence of an installation fee, we were concerned that they did not state the charge. On that basis, we concluded that ads (a) and (c) were misleading.
We understood that installation was free when consumers purchased the TiVo package online and noted that the ‘Digital TV’ page, in ad (b), made that clear. We also noted that the 'Upgrade to a TiVo box' page made clear that an installation fee of £49.95 applied. We therefore considered ad (b) had made clear, where applicable, that an installation fee of £49.95 applied and was not misleading on this point.
On this point, ad (a) breached CAP Code (Edition 12) rules 3.1 (Misleading advertising) and 3.9 (Qualification) and ad (c) breached BCAP Code rules 3.1 (Misleading advertising) and 3.10 (Qualification). We investigated ad (b) under CAP Code (Edition 12) rules 3.1 (Misleading advertising) and 3.9 (Qualification) but did not find it in breach.
3. Not upheld
We noted ad (a) made reference to TiVo box activation and stated 'HD channels included'. The ad also provided a variety of images from channels available on that service. We also noted ad (b) made clear that the TiVo box was included within the packages offered. We noted ad (c), made reference to TiVo box activation and provided details of the benefits of the service. In the context of the ads, we considered consumers were likely to understand the ads related to packages which included the TiVo service.
Because we considered consumers were likely to understand the ads related to the TiVo service and because the ads made clear the total monthly cost that consumers would incur if they purchased the service, and that included the £3 monthly charge the complainants had referred to, we concluded that the ad was not likely to mislead on this point.
On this point, we investigated ads (a) and (b) under CAP Code (Edition 12) rules 3.1 (Misleading advertising) and 3.9 (Qualification) and ad (c) under BCAP Code rules 3.1 (Misleading advertising), and 3.10 (Qualification) but did not find them in breach.
The ads must not appear again in their current form.