The UK Advertising Standards Authority (ASA) has asked UK ISPs to simplify the way in which they advertise the cost of their broadband packages by October 2016.
It follows a report from ASA and communications regulator Ofcom in January 2016, which said the same thing. The report included a survey of consumers and found that 81 per cent could not accurately calculate the true cost of broadband packages from ISP adverts, leading to concerns that ISPs are confusing and misleading consumers.
It also found that just 23 per cent of the sample could correctly identify the total cost per month after the first viewing of an ad when asked simply to recall as much information as they could about the deal on offer without prompting.In response to the same question, 34 per cent recalled pricing information, but only provided partial information or an incorrect figure for the broadband service or line rental costs. Furthermore, 74 per cent of the total sample believed that information about one-off and on-going costs after an introductory period was either ‘fairly’ or ‘very unclear.
Only 22 per cent of participants could still not correctly identify the total cost per month after a second viewing, of which 64 per cent thought the headline price for the broadband element of a package constituted the total cost per month and that line rental costs did not apply.
The report notes that if this proportion were reflected across the population of fixed broadband subscribers, it would mean around 4.3 million UK households were unable to figure out exactly what they would be paying.
The objective of the research was to test consumers’ understanding, based on viewing current ads, of the presentation of pricing offers in typical broadband ads – most commonly those featuring the price of the broadband itself and the monthly line rental alongside it, but also additional pricing elements such as introductory deals, discounts, activation, delivery charges and the length of the contract.
“Based on the findings, we consider that the current approach typically taken by advertisers – where prices for several elements of the offer (broadband, introductory offer, line rental, contract length) are presented separately – is likely to mislead consumers and therefore, from 30 May, will in all likelihood break the rules. While we remain open minded as to how pricing should be advertised so as not to mislead consumers,” stated the report.
Now, ASA has asked ISPs to change the following things by October 2016 (in time for Christmas):
- show all-inclusive upfront and monthly costs, with no more separating out of line rental
- give more prominence to contract length and post-discount pricing
- provide more visibility for upfront costs.
Commenting on the decision, ASA Chief Executive, Guy Parker said: “This new tougher approach has been developed to make sure consumers are not misled and get the information they need to make well-informed choices. We’ll support the broadband industry as they move towards changing their approach in time for the October 31 deadline.”