BBB To NetZero: It Ain’t Broadband
Posted by Sachin Garg on 19th December 2005 | Permanent Link
Better Business Bureaus’ (BBB) National Advertising Division demand’s that NetZero should discontinue advertising claiming that NetZero “HiSpeed 3G” dial-up Internet access can deliver “broadband-like speeds.” The HiSpeed 3G service uses data compression to pump more content down a 56 Kb/s dial-up data pipe than normal and claim broadband like performance.
Telecomweb: In its ruling, the NAD – the advertising industry’s self-regulatory forum – took United Online to task for a series of statements that compared its service to broadband. The HiSpeed 3G service uses data compression to pump more content down a 56 Kb/s dial-up data pipe than normal. Typical claims are of compression of “up to” 5X, which theoretically would yield surfing results that look like a 280 Kb/s connection is in use. (At least, that’s the theory. In practice, the results look like perhaps 200 Kb/s or less. Of course, the FCC does consider 200 Kb/s to be broadband, but that’s a different issue.)
The NAD pointed to statements by United Online that its service lets users “search the Web at speeds so fast, you’d swear its broadband.” It also pointed to such statements as “You won’t believe it’s not broadband” and “Allows you to surf at broadband-like speeds.”
In a legalistic statement, the NAD “determined that claims suggesting the advertiser’s service is so similar to broadband as to be indistinguishable are, in fact, performance claims that require substantiation. NAD further found that the advertiser had not provided adequate support for these claims.”
It rejected United Online claims – and this is kind of hysterically funny – that it should be allowed to continue its advertising claims because they are clearly “mere puffery.” NAD said United Online already informed it that it will appeal the ruling to the National Advertising Review Board (NARB).
On a series of other issues, the NAB said United Online agreed to demands that it discontinue various claims, although the ISP disagreed with the NAB findings. Those included claims relating to a so-called “instant-on” feature and on just how unique the NetZero features actually are.
On one point, however, United Online did win – the claim that the NetZero HiSpeed 3G service is the “fastest surfing you can get without paying the high price for a broadband connection.” The NAB said United Online proved that point, although it recommended re-phrasing the claim so as not to imply that HiSpeed 3G is faster than competing products. As it turns out, the complaint against United Online was filed by perhaps the biggest of those competitors – the Netscape Communications Corp. subsidiary of Time-Warner’s AOL unit.
AOL/Netscape offers a dial-up service that is essentially identical to the NetZero service. Both are priced almost identically as well – typically $10 per month for the accelerated dial-up service with a one-year contract. And, of course, both are suffering from the steady decline in dial-up subscribers and the decreasing prices dial-up providers can charge as broadband in all of its flavors slowly but steadily takes over in the United States. Thus, such compression schemes as NetZero’s HiSpeed 3G are critical to the attempts of dial-up vendors to wring more life and revenue out of their services – or to prolong the agony of death, which is the way some might see it.