MTN South Africa Must Withdraw Advertisement That Claim “Unlimited” Minutes

MTN South Africa Must Withdraw Advertisement That Claim “Unlimited” Minutes

South Africa’s Advertising Regulatory Board (ARB) has found mobile operator MTN’s use of the term “unlimited minutes” in its mobile contract advertising to be misleading. MTN has been given two weeks in which to remove the claims that its MTN Sky packages have unlimited voice minutes, which actually amount to 3,600 minutes a month, ARB ruled. The ruling was in response to a complaint lodged with the board.

MTN advertised its Sky packages at a discount during Black Friday in November 2019, in which the claim that they supplied unlimited voice call minutes was followed by an asterisk. The asterisk at the bottom of the advertisement showed that this was subject to a “fair use policy.” It later emerged that “fair use” actually meant 3,600 minutes a month.

The operator responded to the complaint by saying the term “unlimited” has become common in the industry as a way to refer to products that offer excessive allocations of voice, data or SMS. These products are typically top-tier and more expensive, which means that customers make comprehensive comparisons before they enter into the contract. Reliance on asterisks for this purpose is common in the advertising industry, MTN said, and consumers would instinctively understand the intention behind such an asterisk.

The ARB previously ruled that asterisks are used to alert consumers that material terms are applicable and terms and that conditions apply to the promotion. The ARB said it found in previous rulings that the term “unlimited” should refer to offerings where there is no limitation.

Tarifica’s Take

We have written in this space about various controversies involving misleading claims of unlimited service. In the U.S., for example, government regulators delivered stern warnings to the major operators on the subject, and various changes were made in order to come into compliance. However, in most cases where complaints are lodged on the subject, the term “unlimited” applies to data; generally the scenario is that there is no upper limit on the allotment of megabytes, but that after a certain level is reached or under certain circumstances such as high usage volume within a given area, the speed is dramatically reduced, making the service of less value to users. The throttling, as it is called, may in some cases be so great as to render high-speed data service essentially useless for the purposes it is intended for.

This case involving MTN is somewhat unusual in that it applies to voice minutes, which is not typically a service that operators want to market as unlimited when they do not have the intention of providing an indefinite amount of it. In that sense, such a setup may grate on users even more than data-speed throttling would. Furthermore, the objection from users would likely have been on grounds beyond simply that of principle; 3,600 minutes a month translates to about two hours a day, which is an amount of conversation that quite a few users are likely to surpass under normal conditions.

The reaction from ARB should be taken a cautionary tale by mobile operators. The regulator did not look kindly on the operator’s explanation that “small print” to which the asterisk directed customers was a sufficient explanation, not only because of the principle involving the uses of such disclaimers, but also because the quantity of 3,600 minutes a month was not actually referred to in the text, which only used the words “fair use” without clarification. True, the regulator imposed no punishment but only ordered MTN to remove the advertisement and not use the term “unlimited” in this case, some damage has been done to the operator’s public image.

The lesson here is simply that operators tend to do themselves more harm than good with deceptive, or at best ambiguous, uses of the term “unlimited” and would do better to simply state clearly what the limits are. Customer confidence is a key ingredient in customer loyalty, which in turn is a key ingredient in a steady, long-lasting revenue stream.