It was only a matter of time that T-Mobile would have gotten in trouble for its “UnCarrier” campaign that touts its elimination of standard service agreements.
The problem with the campaign is not with the claim that there are no conventional agreements, it’s that it lacks sufficient disclosures on the nature of the handset financing purchase method, according to the Attorney General for Washington State, coincidentally the same state where T-Mobile USA is currently based.
As a result of the fact that T-Mobile has so far failed in its current campaign to mention that the handset financing option forces a balloon payment for the device if service is cancelled for any reason during the financing period in TV and print advertising, as well as the financing program acting as another type of agreement rather than truly being free of commitments, T-Mobile will be required to amend the campaign to elaborate on that requirement in order to escape deceptive advertising charges.
T-Mobile will also be required to further train all sales associates on properly conveying all of the requirements for the Simple Choice handset financing program before customers complete the purchase, in order to avoid complaints of deceptive advertising by customers and more legal issues.
All consumers who purchased T-Mobile service and equipment between March 26 and April 25, 2013, can obtain a full refund for their equipment and cancel their service plans without being required to pay the remaining balance owed on their devices as long as the customer cancels his or her service per the terms of the agreement, including returning the equipment to T-Mobile.
The company is also required to contact consumers who purchased equipment under the terms of their new business plan to advise them of their right to cancel and obtain a refund. Consumers affected by the ruling can call T-Mobile at 1-877-746-0909 for more information or dial 611 from their T-Mobile phones for more details. Below, a statement from the Attorney General:
“As Attorney General, my job is to defend consumers, ensure truth in advertising, and make sure all businesses are playing by the rules. “My office identified that T-Mobile was failing to adequately disclose a critical component of their new plan to consumers, and we acted quickly to stop this practice and protect consumers across the country from harm.”
For its part, T-Mobile has responded to the judgement with its own statement:
“While we believe our advertising was truthful and appropriate, we voluntarily agreed to this arrangement with the Washington AG in this spirit”. “We also think it important to note that this was a voluntary agreement entered into between T-Mobile and the Washington State AG to settle this matter outside of court, and that the settlement was not a result of any court action.”
That T-Mobile was cited by the Attorney General of its home state of deceptive advertising magnifies the issues the carrier is currently facing in marketing its handset financing program and lack of conventional service agreements without confusing the average person, and the Attorney General may have felt that T-Mobile wasn’t doing enough to be transparent. Whatever the case may be, T-Mobile faces more work if it wants to position its Simple Choice plans as a viable alternative.