T-Mobile has agreed to revise its advertising for the "Price Lock" guarantee, which initially implied a fixed price but allowed for price increases, while maintaining a defense of the promotion. This move follows a challenge from AT&T and a ruling by the National Advertising Division (NAD), part of the Better Business Bureau’s self-regulatory program for the advertising industry.
Numerous T-Mobile customers were confronted with price hikes of up to $5 per line on plans thought to be protected by a lifetime price guarantee. The controversy was escalated by AT&T, which argued that T-Mobile’s advertisements were misleading. The NAD agreed, finding that the "Price Lock" claims were not sufficiently clear and were likely to create a fundamental misunderstanding among consumers.
Although the NAD’s decisions are non-binding, compliance is generally observed by advertisers. In its response, T-Mobile reiterated its commitment to self-regulation and expressed pride in its policy, which promises to cover the final month’s bill if a customer decides to cancel after a price increase. Acknowledging NAD’s recommendations, T-Mobile stated it will make necessary adjustments to ensure future advertisements more clearly communicate the terms of the "Price Lock" policy.
The specific ads in question included promotions for T-Mobile’s 5G home internet service, which featured a $50 monthly rate along with the "Price Lock" claim. These were challenged due to alleged misleading implications about price stability. AT&T highlighted that T-Mobile’s disclosures indicated potential price changes at any time, countering the notion of a true price lock.
Despite defending the innovation and consumer benefits of its "Price Lock" policy, T-Mobile will now align its advertising approach with NAD’s directives, seeking to provide greater clarity in its promotional content. For more details, you can view the full decision by the NAD here, and further reporting on this issue is available here.