Carphone Warehouse will be allowed to continue to advertise its broadband service as "free", despite a ruling against its advertisements by the Advertising Standards Authority (ASA).
Last week, the firm's chief executive, Charles Dunstone, wrote on his blog that Carphone Warehouse "will still be able to advertise the service as free".
But on Wednesday, the ASA agreed with complainants that it was "misleading to suggest that the broadband was free when it involved an 18-month contractual commitment to the Talk3 International (T3I) calls package".
"We considered this made broadband an intrinsic part of the new T3I calls package… Although we acknowledged that the price difference of T3I had not been inflated beyond that of equivalent competitor's call packages we still considered that the broadband element should not have been described as 'free'," the ASA stated.
However, Carphone Warehouse maintains that, because it has since adjusted its offer to include "free broadband" with its Talk3 package — which existed before both Talk3 International and the broadband offer — it can continue to call it "free".
"We never said which way the ASA was going to rule, but the ASA has allowed us to continue using 'free broadband' in our adverts", a spokesperson for Carphone Warehouse told ZDNet UK on Wednesday.
"We agreed to advertise free broadband with an existing tariff, Talk3, and the ASA will then accept that we have free broadband", she added.
A spokesperson for the ASA confirmed to ZDNet UK on Wednesday that "the ad that is problematic cannot be run again", but Carphone Warehouse will still be able to advertise "free broadband" as long as it adds it on to a pre-existing package such as Talk3.
Two other complaints were also upheld against the advertisements, the first of which was over Carphone Warehouse's claim that it was offering free services "forever".
To this, the ASA stated: "As we did not consider the broadband could be described as free… we considered the claim 'free forever' to be misleading. Furthermore, even if the broadband could be described as 'free'… inevitably, for those people who had signed up to the offer when it was advertised as 'free', the broadband would become 'inclusive' after a reasonable period of time because they would continue to pay £20.99 a month".
The other upheld complaint — that customers would not realise they had to be connected to an unbundled exchange to get "free broadband" — forced Carphone Warehouse to state "in the actual body copy that the service is available to 70 percent of UK households", according to the company's spokesperson.
A fourth complaint, regarding the 10-week period that customers had to wait for connection, was rejected by the ASA on the grounds that "it would have been extremely difficult to accurately measure the likely response to the offer".