New York, NY - June 8, 2023 - The National Advertising Division (NAD) of BBB National Programs determined that certain claims made by Consumer Cellular, Inc. for its wireless service plans were supported. However, NAD recommended that Consumer Cellular modify or discontinue other claims, including:
- Comparing the cost of Consumer Cellular's plans to those of its competitors as well as the potential savings by switching to Consumer Cellular's plans; and
- That Consumer Cellular offers "unlimited data."
The claims at issue, which appeared in two television commercials, video, radio, billboard, and print advertisements, were challenged by competitor T-Mobile US, Inc.
Unlike T-Mobile, Consumer Cellular does not have its own network. Consumer Cellular is a mobile virtual network operator providing its Consumer Cellular-branded mobile phone services to consumers over the networks of major wireless carriers with which it has network access agreements.
Half the Cost Claims
Claims that Consumer Cellular's plans are half the cost of competing major carriers' plans were challenged by T-Mobile. Consumer Cellular based the Half the Cost Claims on a comparison of its most popular 5GB plan against the cost of major carrier's lowest price plans. As the advertised monthly cost of Consumer Cellular's 5GB plan is at least half the advertised cost of competitor plans and provides the same coverage, NAD concluded that Consumer Cellular's basis of comparison for its Half the Cost Claims was supported.
However, NAD noted that the monthly prices of other more expensive Consumer Cellular plans are not half the cost of the least expensive plans offered by its major carrier competitors. Therefore, to prevent an overstatement of the comparative benefits of the Half the Cost claims, NAD recommended that Consumer Cellular disclose the basis of comparison and any material differences between the compared plans, including that the competitor plans provided unlimited data.
NAD also recommended that Consumer Cellular modify the claims to disclose clearly and conspicuously the plans that are the basis of comparison and the difference in data allotment between the compared plans, and that, when making Half the Cost Claims, Consumer Cellular ensure that the 5GB plan that is the basis for comparison is as available to consumers as all other plans offered by Consumer Cellular.
Annual Savings Claim
Consumer Cellular makes claims that consumers can "save up to $250/year on all the text, text, and data you need."
NAD determined that a material number of consumers may reasonably understand the claim to mean that up to $250 a year can be saved by switching to Consumer Cellular's unlimited data plan.
NAD found that the Annual Savings Claim was not supported by Consumer Cellular's calculations and recommended that it be discontinued.
"While Prices Rise, Ours are Dropping" Claim
NAD determined that the claim "while prices rise, ours are dropping" conveys the message that Consumer Cellular has decreased the amount being charged to all consumers under all its wireless plans, not just its unlimited data plan.
Because existing subscribers to Consumer Cellular's limited data plans did not have their monthly price reduced, but rather just received an increased data limit, NAD recommended that Consumer Cellular discontinue this express claim "While Prices Rise, Ours are Dropping" or modify its advertising to limit the claim to Consumer Cellular's unlimited data plan, for which it did decrease the monthly price being charged to current subscribers.
Unlimited Data Claim
Consumer Cellular promotes one of its wireless service plans as having "unlimited data." When a subscriber to Consumer Cellular's unlimited data plan reaches 50GB of monthly data usage, the subscriber's data speeds are "throttled," or reduced to a slower speed, for the remainder of the month.
NAD recommended that Consumer Cellular modify the advertising for its unlimited data plan to clearly and conspicuously disclose that access to high-speed data will be reduced after 50GB of use and subscribers will experience slower speeds after 50GB of use for the remainder of their billing cycle.
In the challenged "Comparison Commercial," Consumer Cellular is compared to an unnamed wireless carrier competitor stating "they're the same." At issue for NAD was what consumers may reasonably understand the basis of comparison to be.
Based on the context of the Comparison Commercial and consumer recognition of wireless service coverage maps, NAD determined that consumers would reasonably understand that the statement refers only to the compared plans' respective coverage, not to all benefits and features that the "premium" plans of Consumer Cellular's competitors may provide.
Therefore, NAD concluded that the claim "they're the same" in the context of the Comparison Commercial did not imply that Consumer Cellular's competitors are deceiving customers about the benefits of their premium plans or charging more for their premium plans without providing any additional benefits.
Best Quality Claim
During the proceeding, Consumer Cellular informed NAD that it had elected to permanently discontinue the challenged "the best price with the best quality" claim. Therefore, NAD did not review this claim on the merits.
In its advertiser statement, Consumer Cellular stated that it "will comply with NAD's recommendations" and noted that it "works hard to provide plans for its subscribers at lower prices."
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About the National Advertising Division: The National Advertising Division (NAD) of BBB National Programs provides independent self-regulation and dispute resolution services, guiding the truthfulness of advertising across the U.S. NAD reviews national advertising in all media and its decisions set consistent standards for advertising truth and accuracy, delivering meaningful protection to consumers and leveling the playing field for business.
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