Virgin Media misled consumers over Setanta pricing, says watchdog

Virgin produced a print advertisement which claimed that its services offered the cheapest way to watch Setanta Sports, a television network which has exclusive rights to many Premiership football games.

British Sky Broadcasting (BSB), which owns the Sky satellite television network that is the main competitor to Virgin's cable network, complained, claiming that the comparisons in the advert were unfair and misleading.

Advertising watchdog the Advertising Standards Authority (ASA) found that Virgin's quoted price of £8 per month in the comparison was only available to people already paying £11 or £22.50 a month for Virgin's services.

It said that other options were available which did not incur those fees. Freeview digital terrestrial television and satellite television can show Setanta channels. Though they had initial set up costs the £9.99 Setanta fee was all that viewers had to pay after that.

"Although we appreciated that there could be some initial costs involved in the set up of satellite and Freeview, we considered that those were one-off charges, which were entirely dependent on customers' preferences and were paid to the equipment supplier; the costs were not obligatory as part of the supply of any particular channel," said the ASA ruling. "Unlike BT Vision, Virgin and satellite customers who subscribed to Sky TV, there were no ongoing fees upon which the provision of Setanta Sports was dependent."

The ASA said that when potential customers read Virgin's claim that they were the cheapest provider of Setanta they would infer that it was able to provide the channels more cheaply than others on a month-to-month basis, and not that the fee over and above compulsory subscriptions was cheap.

The ASA also took Virgin to task over its contract terms. While other providers were able to offer Setanta subscriptions on a month-by-month basis, Virgin's offer depended on the signing of a 12-month contract not only for Setanta but also for general digital television and telephone line services.

The ASA said that the tenor of the ad combined with only a small print acknowledgment of the subscription requirements was misleading.

"Comparisons…should not mislead or be likely to mislead. Whilst we noted the text "minimum term contract. Subscription to Virgin digital TV required" appeared in the small print, we considered that that qualification did not go far enough to satisfactorily explain the contractual conditions underlying the provision of Setanta Sports from Virgin in comparison with the other providers," said the ASA ruling.

"We considered that a subscription to a 12-month contract, in the context of the comparison, was a significant factor that was likely to affect consumers' decision to purchase and should, therefore, have been made clear in the ad."

Sky also complained that the Setanta package on a 12 month contract with Virgin and on a month by month basis with Sky were not the same products and that any comparison was therefore unfair. The ASA rejected that allegation.

The ASA said that the ad was misleading. "We told Virgin not to imply in future ads that they offered the cheapest way to receive Setanta Sports and also to ensure that comparisons were not presented in such a way as to give a misleading impression to consumers," it said.