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May 4, 2016updated 05 Sep 2016 11:50am

ASA cracks down on ISPs with all-inclusive broadband prices

News: Line rental can no longer be separated out in broadband advertising.

By Alexander Sword

The Advertising Standards Authority (ASA) has implemented tough new rules for how broadband deals are advertised after research revealed that consumers were unable to understand current advertising.

The new approach, coming into force on 31 October 2016, will require internet service providers (ISPs) to stop separating line rental when detailing the cost of a broadband plan.

This means that the monthly costs shown will be all-inclusive.

Other rules will force ISPs to give greater prominence to the contract length and any post-discount pricing; a move designed to prevent consumers from mistakenly believing that the discount will apply to the full term of the contract.

ISPs will also have to give greater prominence to up-front costs in advertising.

The move comes after joint research by the ASA and Ofcom in January that revealed few consumers could understand the correct pricing from current broadband advertising.

Only 23 percent of participants could correctly identify the total cost per month after a first viewing of the ad. Even after a second viewing of the ad, only 78 percent of participants could correctly identify the total cost per month.

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"For sure, consumers are confused with the slew of bundles available in the market: the inclusion of many services , data caps, hyped connection speeds makes it difficult for users to compare like for like," said Paolo Pescatore, Director at CCS Insight.

It also follows an intervention by Digital Economy Minister Ed Vaizey, who in March said that he had written to major UK telecoms providers such as BT, Virgin, TalkTalk and Sky to invite them to a roundtable.

"You get these headline prices which are misleading," Vaizey said to the Telegraph. "People should pay for what they use.

TalkTalk pre-empted the ruling last week when it became the first major broadband provider to offer a combined monthly price, not separating out line rental.

Meanwhile, BT responded by saying that it supported the aim of the ASA to make things clear for customers.

The spokesperson said: "We follow the current rules on advertising and always try to ensure our customers know exactly what they’re getting for their money before they buy from us. Our broadband pricing is clear and we give our customers personalised speed estimates before they buy."

 

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