- Verizon’s got a bone to pick with the way T-Mobile says it can save consumers $1,000/year over Verizon and AT&T
- Attempts were made to resolve their dispute through a self-regulatory process, but that was unsuccessful
- T-Mobile is sticking to its guns, saying the math shows it offers significant savings over its rivals
Frustrated with its inability to get T-Mobile to change its advertising through self-regulatory means, Verizon took its complaints to court this week, asserting that T-Mobile is manufacturing “mathematical fiction” to lure customers away from Verizon.
The suit, filed in federal court in Manhattan, says T-Mobile promises consumers more than $1,000 in annual savings by comparing its own promotional rates with Verizon’s standard prices “while systematically mischaracterizing” Verizon’s actual service offerings.
“T-Mobile’s reliance on faulty comparative pricing reflects a pattern of deception, as it has doubled down on these tactics even after the National Advertising Division (NAD) recommended that T-Mobile discontinue these types of false cost savings claims,” the suit states.
Verizon first attempted to get T-Mobile to quit making claims about savings via NAD and the National Advertising Review Board (NARB), which recommended that T-Mobile modify its advertising to avoid certain assertions. NAD and NARB are not government agencies but provide guidance to companies on a voluntary basis.
The Verizon suit comes after T-Mobile ticked off its rivals big-time when it unveiled its “Switching Made Easy” app in November, promising to port over an account in just 15 minutes. AT&T filed suit over that, saying T-Mobile was deliberately intruding into AT&T’s computer systems to scrape customer data.
Verizon: Stop with the promises
According to Verizon, T-Mobile intentionally builds its nationwide advertising campaign on the false premise that consumers will “save over $1,000/year vs. Verizon” because T-Mobile claims it “includes streaming, satellite and more benefits that the other guys leave out.”
The price comparisons and calculations compare T-Mobile’s limited-time promotional pricing to Verizon’s standard pricing but ignore Verizon’s active promotions and mischaracterize the value of optional benefits to inflate the supposed “savings,” Verizon asserts.
Big Red also has a problem with how T-Mobile’s implies that Verizon fails to provide satellite connectivity. Most Verizon customers receive satellite connectivity at no additional cost through Apple and Skylo.
“Using T-Mobile’s own cited monthly pricing figures – $140/month for three lines on T-Mobile’s Better Value plan versus $195/month for three lines on Verizon’s Unlimited Ultimate plan – the plan-to-plan delta is $55/month, or $660/year,” the suit states. “This is well below the claimed savings of ‘over $1,000/year.’”
Verizon, whose headquarters is in New Jersey, is seeking injunctive relief under the Lanham Act and New York General Business Law.
T-Mobile: We’ll keep at it
Bellevue, Washington-based T-Mobile provided a statement indicating they are in no way going to back down.
“We’re thrilled that Verizon has finally conceded through this complaint that their customers can save hundreds and hundreds and hundreds when they switch to T-Mobile. While we disagree on how much they save, the facts are clear: when benefits included with T-Mobile’s Better Value plan, which Verizon and AT&T make you pay for, are considered, the math adds up to more than $1,000 in annual savings,” the carrier said in the statement.
“Competitor disagreement doesn’t change those facts, and we stand behind the transparency of our marketing, disagree with the lawsuit and will defend it vigorously,” T-Mobile concluded.