Regarding Advertising by CenturyLink, Inc. for
High-Speed Internet Service
Background:
Suddenlink, Inc.(“Suddenlink”) challenged print and Internet advertising claims by CenturyLink, Inc.(“CenturyLink”) for its Internet services. The challenged advertising included claims that touted the direct/private connection between consumers and CenturyLink’s network, as shown by the following examples:
between your house and our network.”
In addition, Suddenlink challenged CenturyLink’s claim that it had a “fiber-optic network” and also CenturyLink’s claim that consumers could save up to $350/year on CenturyLink’s Internet services as compared to charges by cable companies.
NAD determined that CenturyLink’s claims relating to the direct/private connection between consumers and its network conveyed a superior performance message that, as a result of the direct and private connection, consumers will get a faster and more consistent Internet experience as compared to cable networks. NAD found this message was not supported by the record and recommended discontinuance of these challenged claims.
NAD also determined that one of the reasonable messages conveyed by CenturyLink’s claim that it has a “fiber” or “fiber-optic” network is that its network consisted entirely of fiber optics. NAD found that this message was not supported by the record and recommended that CenturyLink discontinue claims that it has a “fiber” or “fiber-optic” network.
Finally, NAD determined that CenturyLink had not provided a reasonable basis to support its claim that consumers could save up to $350/year as compared to cable companies and NAD recommended that the claim be discontinued.
Claims relating to direct/private connection between consumers and CenturyLink’s network:
No consumer perception evidence was introduced in this case, and thus the panel must place itself in the shoes of consumers to determine the messages reasonably conveyed by the challenged advertising. The panel agrees with NAD’s determination that the challenged claims reasonably convey a superior performance message that, as a result of the direct and private connection between consumers and CenturyLink’s network, consumers will get a faster and more consistent Internet experience as compared to cable networks. The challenged claims clearly contrast CenturyLink’s direct/private connection with the shared Internet connection offered by cable providers and convey the message that CenturyLink’s direct/private connection results in a faster and more consistent experience.
As explained below, the panel also agrees with NAD that CenturyLink has not provided a reasonable basis to support this superior performance message. It is clear that the “last mile” architecture used in the CenturyLink network is different from that used by cable companies. CenturyLink customers are connected directly through a single phone line running from the customer’s home to CenturyLink’s Digital Subscriber Line Access Multiplexer (“DSLAM”), which is linked to CenturyLink’s communications network, while the “last mile” connection to the homes of cable customers may be shared among several customers.
While different network architectures require the use of different techniques to maximize user experience, the record does not establish that CenturyLink’s direct and private connection to homes results in a faster or more consistent experience as compared to cable customers. The record does not include any head to head comparisons with respect to speed and consistency of CenturyLink customers and cable customers. While the record establishes potential issues that could arise from shared “last mile” architecture, the record does not provide a reasonable basis to establish that these issues are not appropriately managed by cable companies or that there are consumer relevant differences in the Internet experiences of consumers that result from these differences in “last mile” architecture.
The panel’s decision is based on the record in this case, although it is noted that the decision is consistent with prior NAD precedent that found no evidence of consumer relevant performance distinctions between private DSL connections similar to CenturyLink’s and shared cable connections. CenturyLink based its arguments in part on the contracts signed by Suddenlink customers, which permit Suddenlink to limit its customers’ upstream applications and overall bandwidth if necessary. While this raises the theoretical possibility that Suddenlink customers could experience limitations with respect to the speed or consistency of their Internet experience, it
does not provide a reasonable basis for advertising claims that convey the message that meaningful speed/consistency differences exist. In fact, the record is clear that different network architectures require different management techniques to ensure a fast and consistent experience,and the panel is not prepared to speculate whether CenturyLink’s network is providing a faster/more consistent experience without evidence to show that is the case.
The panel recognizes CenturyLink’s right to accurately describe differences between its network architecture and the network architecture used by its competitors, but it should not do so in a manner that implies performance benefits that cannot be substantiated.
Fiber-optic network claims:
CenturyLink advertisements claim that it has a “fiber” or “fiber-optic” network. While most Internet providers use fiber-optic cable for the “backbone” of their networks, there are differences as to what is used in the “last mile” that connects the providers’ offices to individual homes. Some networks use fiber-optic cable that runs all the way to the consumer’s home, while CenturyLink uses fiber-optic cable in most instances only up to a DSLAM connection that is connected to consumer homes by phone lines. NAD determined that at least one reasonable interpretation of CenturyLink’s claims to have a fiber or fiber-optic network is that its services are provided over a network that solely consists of fiber-optic cable all the way to consumer homes. The panel agrees that this is one of the messages reasonably conveyed by the challenged advertisements, and further agrees with NAD that this message is not supported by evidence in the record.
Savings claims:
CenturyLink’s advertising claims that consumers will save up to $350/year by subscribing to its Internet service. This is based on a comparison of (a) the $14.95 monthly cost for Internet service that is part of CenturyLink’s bundled price for Internet, television and telephone services with (b) stand alone prices charged by cable companies for Internet services. The record showed that, in some markets, consumers would have to pay $79.95 or more for CenturyLink’s bundled services. The claimed $350/year savings is not supported by the record. CenturyLink is calculating the savings based on a $14.95 monthly cost for Internet services that cannot be separately purchased for $14.95, and its savings analysis does not take into account the full costs involved in purchasing the required bundled package. The claimed savings is not achieved when consumers purchase the Internet/television/telephone bundle, which is the only way that consumers can receive Internet services at the stated price. While CenturyLink is free to make truthful comparisons of its stand alone Internet costs with the stand alone costs of competitors, it cannot support a savings claim for one part of bundled services by ignoring the total price that must be paid for the other services. The represented price savings is not a meaningful one when it cannot be achieved without additional expenditures, and those additional expenditures need to be factored in before a meaningful savings claim can be made.
Decision:
The panel thanks both parties for participating in this process, which is an important part of the advertising industry’s self-regulatory efforts to ensure the truthfulness and accuracy ofadvertising claims. The panel recommends that CenturyLink discontinue (a) claims stating or reasonably implying that, as a result of the private and direct connection between consumers and CenturyLink’s network, consumers receive a faster and more consistent Internet experience1; (b) claims that it has a fiber or fiber-optic network unless it is referring to a network that uses fiber-optic cable all the way to consumer homes; and (c) the challenged claims of up to a $350 savings for its Internet services based on bundled pricing that includes Internet services.
Advertiser Statement:
CenturyLink appreciates the opportunity to participate in the self-regulatory process and the panel’s review of the earlier NAD decision. CenturyLink respectfully disagrees with the panel’s decision in this matter, and strongly believes it provided sufficient substantiation for comparative claims regarding network design differences and traffic management tactics that meaningfully impact customers’ high-speed Internet experience, accurately used the terms “fiber” and “fiberoptic”to describe its network, and properly supported and disclosed savings claims related to high-speed Internet services within service bundles.
While CenturyLink disagrees with the panel’s ruling and analysis, it will carefully consider the panel’s comments and recommendations in the development of future high-speed Internet advertising and comply with the decision. In addition, CenturyLink will continue to describe how its technology functions in an accurate and non-misleading manner in future advertising.
1 This does not prevent CenturyLink from making claims when it has a reasonable basis for doing so based on actual user experience.
Board Members for Panel #167
Professor
SMU - Temerlin Advertising Institute
Director, IBM Americas Marketing
IBM
Pamela M. Rachal
Senior Manager, Advertising Services
Bayer HealthCare LLC
Howard Courtemanche
Executive Vice President
JWT
Beau Fraser
Managing Director
The Gate Worldwide
Tuesday, August 2, 2011
NARB Panel Report #166 / Time Warner Cable, Inc.
Regarding Advertising by Time Warner Cable, Inc.
Background:
Verizon Communications, Inc.(“Verizon”) challenged claims by Time Warner Cable, Inc.(“Time Warner”) – in television, print, and Internet advertising – for its television, Internet and telephone services (“telecommunications services”). The challenged claims described Time Warner’s telecommunications services network as a fiber optic network and advanced fiber optic network, as demonstrated by the following examples:
• “[Time Warner’s] fiber-optic network delivers speeds up to 15 Megs for a
dramatically faster online experience.”
• “Road Runner Turbo is zooming across the advanced fiber network.”
• “[Time Warner’s] “advanced fiber network lets you experience the web like never before.”
• “[Time Warner’s] advanced fiber optic network delivers the future to you… for less.”
NAD determined that at least one reasonable interpretation of Time Warner’s claim to have a fiber optic network was the message that Time Warner offers its telecommunications services over a network that (1) solely consists of fiber optics and (2) is the functional and/or technical equivalent of a telecommunications services network where fiber optics extend to the home. NAD further determined that Time Warner did not provide a reasonable basis to support this message, and recommended that Time Warner discontinue use of the phrase “fiber optic network” to describe its network.
Findings and Conclusions:
Differences in network structure:
Times Warner, which described itself as an early adopter of fiber optic technology, argued it was entitled to identify its network as “fiber optic” because it used fiber optic cable in over 95% of the network.
While most telecommunications providers currently use fiber optic cable for the “backbone” of their networks, there are differences as to what is used in the “last mile” that connects the providers’ offices to individual homes. For example, both Verizon’s FIOS service and Time Warner use fiber optic cable for their networks’ “backbone.” Verizon’s FIOS network, which has been described as a “Fiber to the home” network, also uses fiber optic cable from Verizon’s central offices to a terminal attached to the consumer’s home. Time Warner’s network, which has been described as a “hybrid fiber coax” or “Fiber to the node” network, uses fiber optic cables from its central offices to a neighborhood “node,” and from that point coaxial cable is used in the “last mile” to connect the node to each consumer’s home.
The record in this case indicates that “last mile” architecture is relevant to a network’s performance capabilities. Prior NAD cases recognized differences between “Fiber to the home” networks and “Fiber to the node” networks, and the evidence in the present case shows those differences continue to exist. The record indicates that “Fiber to the home” networks are generally considered to represent the highest level of technology currently used for consumer telecommunications services.
What are reasonable consumer takeaways with respect to networks represented to be “fiber optic”?
No consumer perception evidence was introduced in this case, and thus the panel must place itself in the shoes of consumers to determine the messages reasonably conveyed by the challenged advertising.
The panel has determined that, for many consumers, the messages reasonably conveyed by Time Warner’s description of its network as “fiber optic” include (1) fiber optics are used for transmission throughout the entire network controlled by Time Warner 1 and/or (2) Time Warner’s network represents the highest level of technology currently used by consumer telecommunications services providers. These messages are reinforced by the challenged advertising’s repeated emphasis on speed and the advanced nature of the Time Warner network.
Both parties provided an extensive record concerning the terminology used by a variety of sources – including industry, media and government – in describing consumer telecommunications services networks. The panel’s findings are consistent with the terminology commonly used by these sources. The record contains numerous examples of media and industry communications that identify the Verizon FIOS network as a “fiber optic” network and use other descriptors -- such as cable, hybrid fiber coax, or DSL -- to describe networks like Time Warner’s that do not run fiber optic cable directly to individual homes. Media usage is also consistent with reasonable consumer perception that fiber optic networks represent the highest level of technology currently used by consumer telecommunications services providers.
The panel recognizes that many products and services may be appropriately described by reference to their predominant characteristic. However, reference to the predominant characteristic of a product or service can be misleading if, as in the present case, that reference reasonably implies attributes that are not substantiated.
Time Warner does not dispute that its telecommunications services network does not use fiber optic cable throughout its entire network because fiber optic cables are not used in the “last mile” to consumer homes. In addition, Time Warner has not provided a reasonable basis to show that its network represents the highest level of technology currently used by consumer telecommunications services providers.
___________________________________
1 The parties in this case debated the meaning of “network,” including questions of whether it would be
understood to end at the door of consumer homes or at specific devices within a consumer’s homes. While
this could be a matter debated among sophisticated users, the panel believes that the more common reasonable
perception is that a “network” describes the entire flow of transmissions controlled by providers up to (but not
inside) the home.
___________________________________
Decision:
The panel thanks both parties for participating in this process, which is an important part of the advertising industry’s self-regulatory efforts to ensure the truthfulness and accuracy of advertising claims.
The panel recommends that Time Warner discontinue the challenged claims that its telecommunications services are provided on a fiber or fiber optic network.
Advertiser Statement:
Time Warner Cable respectfully disagrees with the NARB panel’s decision and maintains that: (1) its advertising claims to have a fiber optic network are fully substantiated; and (2) its non-comparative “fiber optic network” claims cannot reasonably be interpreted to imply that its fiber-to-the-node network is the same as FiOS’s fiber-to-the-home network. Time Warner Cable believes that the panel’s decision denies Time Warner Cable the opportunity to truthfully and accurately describe its fiber optic network in its advertising – a practice which it has engaged in for two decades without any signs of consumer confusion or harm.
In addition, the panel's decision inhibits the ability of Time Warner Cable and other service providers to distinguish their services in areas where their competitors have indisputably inferior products. Despite its disagreement, however, in the spirit of the self-regulatory process, Time Warner Cable will take the panel’s decision into consideration and modify and/or withdraw the specific advertisements at issue to comply with the panel’s decision.
Board Members for Panel #166
Dr. Jan LeBlanc Wicks (Chair)
Friday, July 22, 2011
NARB Panel Report #165 / The Sherwin-Williams Company Dutch Boy Refresh Paint
Regarding Advertising by The Sherwin Williams Company for
Dutch Boy Refresh™ Paint
Backround:
PPG Architectural Finishes, Inc. (“PPG”) challenged claims made by The Sherwin-Williams Company (“Sherwin-Williams”) for its Dutch Boy Refresh™ paint. The challenged claims were made in print, point-of-sale, internet, labeling and television advertising. The challenged claims include:
• “eliminates household odors”
• “continuously eliminates odors day after day”
• “The first and only paint with Arm & Hammer Odor Eliminating Technology….”
NAD recommended that Sherwin-Williams discontinue the challenged claims or modify them to better reflect test results. Sherwin-Williams agreed to discontinue its durational claims (e.g., “continuously” and “day after day”), but appealed NAD’s findings as to the message reasonably conveyed by claims that Refresh paint “eliminates household odors” and has “odor eliminating technology.”
The panel agrees with NAD that one of the messages reasonably conveyed by the “eliminates household odors” claim is that Refresh paint reduces odors to a level that is not perceptible by most consumers. The panel’s determination is based on the plain meaning of the word “eliminate,” which will be understood by most consumers to mean “get rid of” or “remove.” While the testing submitted by Sherwin-Williams establishes that Refresh paint helps to reduce odors through the removal of some odor particles, it does not establish that Refresh paint removes enough odor particles to reduce odors to an imperceptible level.
Sherwin-Williams thanks the NARB panel for its careful consideration of its appeal and is pleased to participate in the self-regulatory process. Sherwin-Williams is pleased that the panel agrees that its use of the phrase “odor eliminating technology” does not convey any unsubstantiated performance benefit for RefreshTM Paint and may continue to be used, including in executions that do not include further information on how the technology works. Sherwin-Williams is also pleased that the NARB panel affirmed that Sherwin-Williams’ substantiation research validated and substantiated the intended meaning of its claims: that RefreshTM Paint reduces household odors. Although it is disappointed that the panel did not agree as to the scope of the message conveyed by the “eliminates household odors” phrase, Sherwin-Williams will comply with the NARB panel’s recommendations.
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