Background
Summary of Council decision:
Four issues were investigated of which two were Upheld and two Not upheld.
Ad description
The website ad (a) on www.fasthosts.co.uk and two magazine ads (b) and (c) in industry facing publications, made several claims about the advertiser's online services.
Issue
Heart Internet Ltd challenged whether:
1. the claim "Best UK spec" in relation to virtual servers on the website ad (a) and in ad (b) was misleading and could be substantiated;
2. the claim "RESELLER HOSTING ONLY £19.99pm" on the website (a) was misleading, because it did not make clear that that price was an introductory rate for 12 months only;
3. the claims "industry leading range" in relation to web hosting solutions in ad (a), "INDUSTRY LEADING TECHNOLOGY" in relation to virtual servers and dedicated servers in ads (b) and (c) respectively and "Industry leading power & performance" in relation to dedicated servers in ad (c), were misleading and could be substantiated; and
4. ad (b) misleadingly implied that the specification listed was available at the lowest price of £26.99 ex VAT.
Response
1. Fasthosts Internet Ltd (Fasthosts) stated that they were confident that their services were superior to those of other suppliers and they provided a table which compared aspects of their service with three of their competitors. They believed that their platform and hypervisor technology provided customers with a superior virtual private server (VPS) experience, which included automatic failover and recovery, large scalable architecture and excellent support and service-level agreements (SLAs).
2. Fasthosts said the £19.99 price for the reseller service was a one-month contract only and that the customer could close their account at any time with no further obligation. They said they had made changes to the home page to make it clearer that it was a one-month contract, but that the purchase page which consumers were directed to had always contained all details and minimum terms.
3. Fasthosts said they replaced their dedicated servers every 18 to 24 months to ensure the latest technology was being used and that in between server updates the hardware they deployed for shared hosting was also high end.
4. Fasthosts said there were two items that were not included in the £26.99 price. They pointed out that the "Plesk control panel to run multiple websites" had been described as "optional" in the body copy and that "Resource monitoring with email & SMS alerts*" had been linked to text that stated "SMS usage alerts service is available from £3 per month & limits apply". They believed it was clear from the ad that those two features would not be included at the £26.99 price.
Assessment
1. Upheld
The ASA considered that consumers would interpret the claim "Best UK spec" in ad (a) to mean that Fasthosts' virtual servers had a higher overall specification than those available from all other online services providers in the UK. We noted that the comparative table provided included the specification of virtual servers offered by three of their competitors only. Because we had not seen evidence that demonstrated Fasthosts offered the best specification virtual servers in the UK, we concluded that the claim had not been substantiated and was misleading.
On this point, ad (a) breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation), 3.11 3.11 Marketing communications must not mislead consumers by exaggerating the capability or performance of a product. (Exaggeration) and 3.38 3.38 Marketing communications that include a comparison with an unidentifiable competitor must not mislead, or be likely to mislead, the consumer. The elements of the comparison must not be selected to give the marketer an unrepresentative advantage. (Comparisons).
2. Not upheld
We noted that the reseller hosting was sold on a monthly contract and that the advertised price was available to consumers for a maximum period of 12 consecutive months. Although we understood that the price would increase after that period, we noted that consumers could cancel their agreement at any time. Because consumers were entitled to take advantage of the advertised price for up to a year and were not obliged to maintain their account at the higher monthly rate at the end of that period, we considered that the higher rate, which was explained on the purchase page one click away from the home page, was not sufficiently significant to warrant inclusion on the home page. We therefore concluded that the claim was unlikely to mislead.
On this point, we investigated ad (b) under CAP Code (Edition 12) rules
3.3
3.3
Marketing communications must not mislead the consumer by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that the consumer needs to make informed decisions in relation to a product. Whether the omission or presentation of material information is likely to mislead the consumer depends on the context, the medium and, if the medium of the marketing communication is constrained by time or space, the measures that the marketer takes to make that information available to the consumer by other means.
(Misleading advertising) and
3.9
3.9
Marketing communications must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify.
(Qualification).
3. Upheld
We noted that Fasthosts had said they updated the technology they used regularly. However, we considered that consumers would interpret the claims "industry leading range", "INDUSTRY LEADING TECHNOLOGY" and "Industry leading power & performance" in ads (a), (b) and (c) to mean that the web hosting, virtual servers and dedicated servers provided by Fasthosts used the latest technology on the market and that that technology was not being used by any other online services provider in the UK. Because we had not seen evidence that demonstrated that was the case, we concluded that the claims had not been substantiated and were misleading.
On this point, the claims in ads (a), (b) and (c) breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation), 3.11 3.11 Marketing communications must not mislead consumers by exaggerating the capability or performance of a product. (Exaggeration) and 3.38 3.38 Marketing communications that include a comparison with an unidentifiable competitor must not mislead, or be likely to mislead, the consumer. The elements of the comparison must not be selected to give the marketer an unrepresentative advantage. (Comparisons).
4. Not upheld
We considered that the two aspects of the service that were not included at the "from" price had been qualified, either in the body copy or in linked text at the foot of the ad, in a manner that made clear they would be available only at an additional cost. Because we considered that consumers would understand what was included at the £26.99 price, we concluded that the ad was not misleading.
We investigated ad (b) under CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.9 3.9 Marketing communications must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify. (Qualification) and 3.22 3.22 Price claims such as "up to" and "from" must not exaggerate the availability or amount of benefits likely to be obtained by the consumer. (Prices).
Action
The claims "Best UK spec", "industry leading range", "INDUSTRY LEADING TECHNOLOGY" and "Industry leading power & performance" in ads (a), (b) and (c) must not appear again in their current form. We told Fasthosts not to make "best" or "industry leading" claims unless they held the necessary substantiation.
CAP Code (Edition 12)
3.1 3.11 3.22 3.3 3.38 3.7 3.9
