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T-Mobile challenge of Sprint 50% off promo backed by NAD

The BBB’s National Advertising Division backed a T-Mobile challenge of Sprint’s 50% off promotion, hiding of activation fee

Sprint has been reprimanded by the Better Business Bureau’s National Advertising Division for false claims in its “cut your bill in half” advertisements and for hiding mandatory activation fees.
In ruling on a claim brought by T-Mobile US, NAD recommended Sprint discontinue its 50% saving promotion, noting the advertisements don’t clearly convey limitations to the claim in regards to savings vs. T-Mobile US rate plans. Sprint had argued references to rate plans and images of rate plans in the advertisements made clear comparison claims.
“NAD determined that references to the limitations are blurred by the fast-moving audio and visual elements of the commercials, which also make the supers, which refer to rate plans as well as limitations and restrictions, difficult to read, notice and understand,” NAD noted. “NAD determined that the overriding message – that you can have the same rate plan for half the price simply by switching to Sprint – was not supported by the evidence in the record and recommended that the commercials be discontinued.”
Sprint did note in the offer it requires customers to port their number from one of the carrier’s nationwide rivals with the promise of a 50% savings on their monthly bill. The carrier also explained the offer was valid for “most plans” with the discounted monthly rate available through Jan. 8, 2018. The 50% discount also applied to per-device access fees on data buckets.
In its decision, NAD also recommended Sprint alter its online and in-store material to more clearly explain the 50% savings is against T-Mobile US two gigabyte, 6 GB and 10 GB rate plans.
T-Mobile US was not initially part of the “cut your bill in half” promotion when launched in late 2014, but Sprint added its now larger rival to the mix when it relaunched the offer late last year. That move resulted in some pointed barbs on Twitter between Sprint CEO Marcelo Claure and T-Mobile US CEO John Legere.
T-Mobile US also countered by rolling out its own half-off promotion enticing Sprint customers to switch to MetroPCS for savings of up to 50% compared with Sprint’s current rate plans. The offer also targeted Sprint’s prepaid brands Virgin Mobile US and Boost Mobile.
NAD also dinged Sprint for not more clearly noting customers taking advantage of the 50% off promotion would also be charged an activation fee of $36 per line.
“This one-time activation fee is more than the base price of both Sprint’s 2 GB and 6 GB plans … and without a clear and conspicuous disclosure of the fee, consumers could be misled by Sprint’s offer of 50% off their current rate plan,” NAD explained.
While not legally obligated to comply, Sprint filed comments with NAD that it has discontinued its “cut your bill in half” claims, and that it would comply with NAD recommendations. However, the 50% promotion remains an option on the carrier’s website.
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