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National Advertising Division Recommends T-Mobile Discontinue Certain Comparative Savings Claims for its Mobile Telephone Service; T-Mobile to Appeal

1. NAD recommended T-Mobile discontinue misleading savings claims from multiple advertisements. 2. T-Mobile's claims inadequately clarify savings based solely on specific plan costs. 3. The company intends to appeal NAD's decision regarding these savings claims. 4. Verizon initiated the challenge, likely to gain competitive advantage against T-Mobile. 5. Consumer trust may be affected by ongoing issues with T-Mobile's marketing practices.

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FAQ

Why Bearish?

Advisory from NAD could hurt T-Mobile's market reputation and customer trust, similar to past incidents where misleading ads resulted in negative stock reactions.

How important is it?

The investigation raises potential compliance and marketing risks for T-Mobile, impacting investor confidence.

Why Short Term?

Immediate negative effects on stock may occur due to market response to advertising disputes, but long-term recovery is possible depending on resolution.

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VZTMUS
In a challenge brought by Verizon Communications Inc., BBB National Programs’ National Advertising Division recommended that T-Mobile US, Inc. discontinue savings claims that appeared in a “Save on Every Plan” brochure, two commercials, “Top Three Plays of the Day” and “Holidays Are Coming in Hot: Families: Save 20%,” a T-Mobile USA press release, and on T-Mobile’s Savings Calculator website. May 19, 2025 11:00 ET  | Source: BBB NATIONAL PROGRAMS New York, NY, May 19, 2025 (GLOBE NEWSWIRE) -- In a challenge brought by Verizon Communications Inc., BBB National Programs’ National Advertising Division recommended that T-Mobile US, Inc. discontinue savings claims that appeared in a “Save on Every Plan” brochure, two commercials, “Top Three Plays of the Day” and “Holidays Are Coming in Hot: Families: Save 20%,” a T-Mobile USA press release, and on T-Mobile’s Savings Calculator website. During the challenge, T-Mobile informed the National Advertising Division (NAD) that it modified the savings claims to explicitly reference streaming services in the claims themselves and modified its disclosures for the savings claim. NAD determined that, despite T-Mobile having modified the savings claims to explicitly reference streaming services, one message that continues to be conveyed is that consumers who switch to T-Mobile from Verizon can save 20%, and that those savings are achieved through plan costs alone. NAD found that consumers are not likely to expect the value of ancillary benefits to be included in a savings comparison. NAD also found that T-Mobile’s updated disclosures fail to clearly and conspicuously inform consumers that the 20% savings claim is based on the cost of the plan, additional optional fees for third-party streaming services, and is contingent on purchasing three lines of service at a specific tier. In addition, NAD found that the three-line requirement disclosure in the modified advertising is not clear and conspicuous and further contradicts the message of the broad comparative savings claim. NAD therefore recommended T-Mobile discontinue the challenged claims. In its advertiser statement, T-Mobile stated that it “is disappointed with NAD’s decision and will appeal it.” Appeals of NAD decisions are made to BBB National Programs’ National Advertising Review Board (NARB), the appellate-level truth-in-advertising body of BBB National Programs. All BBB National Programs case decision summaries can be found in the case decision library. For the full text of NAD, NARB, and CARU decisions, subscribe to the online archive. Per NAD/NARB Procedures, this release may not be used for advertising or promotional purposes. About BBB National Programs: BBB National Programs, a non-profit organization, is the home of U.S. independent industry self-regulation, currently operating more than 20 globally recognized programs that have been helping enhance consumer trust in business for more than 50 years. These programs provide third-party accountability and dispute resolution services that address existing and emerging industry issues, promote fair competition for businesses, and a better experience for consumers. BBB National Programs continues to evolve its work and grow its impact by providing business guidance and fostering best practices in arenas such as advertising, child-and-teen-directed marketing, data privacy, dispute resolution, automobile warranty, technology, and emerging areas. To learn more, visit bbbprograms.org. About the National Advertising Division: The National Advertising Division of BBB National Programs provides independent self-regulation and dispute resolution services, guiding the truthfulness of advertising across the U.S. The National Advertising Division reviews national advertising in all media and its decisions set consistent standards for advertising truth and accuracy, delivering meaningful protection to consumers and promoting fair competition for business. Contact Data Name: Jennie Rosenberg Email: jrosenberg@bbbnp.org Job Title: Media Relations

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