In 2012 Committee of Advertising Practice (CAP) created new guidance that clarified the use of the term “unlimited” in telecommunications ads. “Unlimited” claims are now likely to be acceptable only if any restrictions put on that unlimited service do not run contrary to what the average consumer would expect from an “unlimited” service. The guidance does not explicitly define what a consumer might expect from the service, but suggests that any limitations the provider imposes on the speed or use of the service should not stop legitimate users from doing normal online activities like streaming content. The CAP guidance still refers to fair-use policies, but states that:
Unlimited claims are likely to be acceptable provided that:
- the legitimate user incurs no additional charge or suspension of service as a consequence of exceeding any usage threshold associated with an fair use policy (FUP), traffic management policy or the like; and
- provider-imposed limitations that affect the speed or usage of the service are moderate only and are clearly explained in the marketing communication.
So, marketers will no longer be able to use a fair-use or traffic management policy to slow down legitimate users, nor will they be able to impose an additional charge or suspend the service. A policy which does not affect the majority of customers but impacts significantly on a small number of heavy users is unlikely to be considered “moderate”. In 2013 the Advertising Standards Authority (ASA) upheld complaints about several companies that offered “unlimited” data but imposed limitations for exceeding the threshold of FUPs. In one case the advertiser contacted users on congested exchanges using more than 150 GB in a month and asked them to reduce their usage in peak hours or face having their service suspended (Be Un Limited, 5 June 2013). In another the advertiser reduced the speeds of the heaviest users by 50%, which the ASA considered had a more than moderate impact on those customers (Virgin Media Ltd, 27 March 2013). Limiting the speeds of those exceeding a data threshold during peak times is also likely to be problematic (Avonline plc, 5 February 2014).
The ASA has agreed that a limitation such as blocking the delivery of spam e-mail, a measure targeted at illegitimate users in breach of their service agreements, is likely to be acceptable. Setting maximum speeds for uploads and downloads that apply to all customers equally on a mobile service was also considered unlikely to contradict an unlimited claim. However, the restriction of peer-to-peer activity at peak times is likely to be seen as impacting unfairly on legitimate users. Though an advertiser has argued that this technology is often used to ‘pirate’ copies of copyright-protected content, the ASA considered that peer-to-peer activity might also be used for legitimate purposes (Everything Everywhere Ltd 17 April 2013).
The guidance for fair-use policies applies to fixed line and mobile telephony and data services, as well as similar services provided on other platforms, such as Voice over Internet Protocol (VoIP).
Note: This advice is given by the CAP Executive about non-broadcast advertising. It does not constitute legal advice. It does not bind CAP, CAP advisory panels or the ASA. CAP’s AdviceOnline entries provide guidance on interpreting the UK Code of Non-broadcast Advertising and Direct & Promotional Marketing.
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