Advertisment
The advertising on Imagine Communication’s website showed an image of a phone handset in a cradle with a WiFI hub and stated the following:
• “€19 a month, no catches, no price increase
• No line rental
• Wi-fi enabled
• Up to 10Mb high-speed broadband
• Unlimited local & national calls
• International calls for only 3c per minute
Can’t wait, then call us on 1800-929-029
Switch to WiMAX Phone & Broadband Today for only €19 a month
Offer details*
high-speed broadband; free phone line; unlimited local calls; unlimited national calls; international calls for only 3c; great wi-fi; free mobile app (coming soon)
Top 30 countries at 3c per minute
Czech Republic, Brazil, China, Latvia, Austria, Lithuania, Turkey, Luxembourg, India, India – mobile, Romania, Switzerland, Australia, Norway, Portugal, Sweden, New Zealand, New Zealand – mobile, Singapore, Belgium, Poland, Italy, Hungary, Spain, Netherlands, Denmark, Germany, Canada, USA, France, and United Kingdom.
* The Legal Jargon.
“€19 offer available to new Imagine customers only Full Terms & Conditions apply”. (A link to the terms and conditions was provided at this point.)
Included in the terms and conditions were
• “All prices are inclusive of VAT at 23%.
• Service subject to availability, 12 month term applies.
• 4G WiMax Hub required. A €100.00 activation fee applies. Equipment remains the property of Imagine.
• WiMax Hub monthly rental charge of €3.99 applies.”
Complaint
Two complaints were received in relation to the offer. Both complainants considered the advertising to be misleading as the advertisers had indicated that there was ‘no line rental’ applicable to the offer, yet there was a charge of €3.99 for Wimax hub rental which customers had to pay on a monthly basis to avail of the service. Both complainants said that the true cost of the offer was, therefore, €22.99 and not €19.00 as indicated.
Response
The advertisers said that their claim of “no line rental” was correct, as unlike traditional fixed line operators a physical phone line was not a requirement with their WiMax service. They said that WiMax was a Fixed Wireless technology providing broadband and phone calls over their 4G next generation wireless network without the need for a physical phone line.
Regarding the “WiMax Hub” the advertisers said that consumers were advised within the terms and conditions attached to the offer that a 4G WiMax Hub was required. This 4G WiMax Hub, connected the user to the WiMax network and was WiFi enabled. This equipment remained the property of Imagine and customers were also advised that a rental charge of €3.99 a month applied to the use of the equipment.
The advertisers said that while they did not charge a €100 installation fee, they had clearly stated in their terms and conditions that there was a €100 activation fee applicable to the WiMax service.
The advertisers said they did not consider they had breached the requirements of the Code. As well as referencing the additional costs in their terms and conditions, they said they were also explained to customers prior to signing up to the service.
Further Information:
The Secretariat asked the advertisers to provide their specific comments in relation to Sections 2.41 and 2.42 of the Code. The advertisers said the offer in question had only been advertised on a dedicated purpose built microsite to effectively communicate, not only their core product offering, but also the terms of the offer, all on the one page. They said they believed their offer was clear and transparent with all of the prices and associated costs detailed upfront on their offer page with a direct link provided to the full product description, price guide and detailed terms and conditions.
The advertisers reiterated that they had clearly stated in their advertising that WiMax 4G equipment was required to use the service. The charges associated with the equipment and set up of the service were also stated in the terms of the offer. Furthermore, they said, a direct link had also been provided to their price guide and prominently showed the equipment and setup charges at the top of the guide under their bundle offering. As previously indicated this information was also provided to their customers by their sales representatives prior to any contract being signed to ensure they understood and accepted the charges involved in signing up to the package.
Conclusion
Complaint Upheld
The Complaints Committee considered the detail of the complaints and the responses from the advertisers together with the further comments received from the advertiser. The Committee noted that while the Hub was pictured in the marketing communication the price quoted did not cover its rental. They considered that where a headline price per month was quoted, even while the figures involved were neither large nor complex, consumers should not be required to recalculate the monthly cost involved to receive a service. In the circumstances, the Committee upheld the complaints under Sections 2.22, 2.24, 2.41 and 2.42 of the Code.
Action Required: The advertising should not be used in its current form again. Where prices are quoted they should reflect the total unavoidable monthly cost to consumers.
