The ability to use the term 'fibre’ in broadband advertising has been subject to debate in several countries recently. Operators have had heated exchanges around the issue, and regulators have intervened. In France and, more recently, in Italy regulators have recognised the need to distinguish FTTH or FTTB from FTTC, and to make sure customers are adequately informed on the type of service they are purchasing. The discussion is also lively in the UK, where advertising authorities have recently taken a different stance, and CityFibre is now seeking judicial review to make sure the word fibre is no longer used for hybrid connections. In the long run, it is likely that regulators will agree on the need to highlight differences clearly. However, it is not yet clear whether technology differences matter to customers as much as performance.
AGCOM’s decision in Italy comes after lively disputes between ISPs
In July 2018, AGCOM approved rules on how broadband providers can communicate to customers which physical infrastructure they use as part of their broadband offering. Fixed ISPs are required to guarantee ‘full transparency’ in both advertising and contracts. In particular, the decision regulates how ISPs can use the word fibre. They can do so freely without further specification only if the connection is FTTH or fibre to the building (FTTB). For FTTC or FWA connections, ISPs will have to specify that it is a fiber-copper or a fiber-radio mix, respectively. Such expressions are expected to have the same prominence as the word fibre, so it won’t be possible to hide it in the small print.
The decision in Italy also sees the launch of a trial of broadband labels. For FTTH/FTTB connections, operators will be able to use a green sticker with the letter ‘F’ and the word fibre as sub-title. For connections involving a technology mix, the sticker will be yellow with ‘FR’ as letters – either for a mix of fibre and copper, or for a mix of fibre and radio. Any other architecture which doesn’t have any fibre in the access network will be labeled in red with the ‘R’ letter, either for copper or radio.
AGCOM’s ruling applies as of 16 July 2018, and comes after heated disputes between Italian ISPs on how broadband has been advertised in the country. Franco Bassanini, CEO of Open Fiber, had voiced his discontent about AGCOM’s failure to pass the new rules despite a law-decree had been in force since October 2017. Between March and April 2018, the Italian competition authority AGCM had fined all the major Italian fixed ISPs (TIM, €4.8m; Vodafone, €4.6m; Fastweb, €4.4m; and Tre, €4.25m) for misuse of the word fibre in their advertising. it is understood that TIM is legally challenging the decision of the AGCM.
The French government made a distinction between FTTH and FTTB since 2016
Disputes between operators were also the reason for the French government to intervene in 2016. The decision to emit a decree and update the Consumer Protection Law came in response to the accusations made by Orange and Free (which were describing FTTH as fibre) against SFR, which was using the same term for FTTB connections. This is particularly striking because, while the decree helped customers get an improvement in clarity, it was also distinguishing between FTTB and FTTH which are generally both capable to deliver Gigabit speeds (since the distance between the building and home is generally relatively short); as such, the difference between the two is less significant than the one between FTTC and FTTH. It is also worth noting that the national regulator ARCEP had given its favourable opinion to the adoption of rules mandating ISPs to be more transparent when advertising broadband.
The government’s decree, passed in March 2016, came into force three months later for advertising, and a year later for all other commercial communications. ISPs which do not provide a pure FTTH connection must add “except connection to the household”, and specify the actual technology of the final connection, in “sufficiently significant” characters. They should also give equal prominence to download and upload speeds in their advertising.
UK based ISPs can still refer to fibre for FTTC broadband – but for how long?
A lively debate is now happening in the UK, where it is still possible for ISPs to refer to “fibre broadband” for connections which only partially use fibre, including FTTC. For a long time, pure FTTH networks were a small fraction of UK connections, which made this less of an issue. This is expected to change given the recent flurry in fibre deployment, and will become increasingly important as the government pushes for a nationwide fibre coverage by 2033. The issue has become even hotter in recent weeks, as CityFibre is now seeking a judicial review of the rules passed by the Advertising Standard Authority (ASA) back in 2008, and subject to a minor review in 2017. The reviewed guidelines go some way toward recognising the differences in performance between ‘part-fibre’ and ‘full-fibre’ services, and advise that:
Ads should not state or imply a service is the most technologically advanced on the market if it's a part-fibre service;
Ads should make performance claims for fibre services (part- or full-) that are appropriate for the type of technology, and should hold evidence to substantiate the specific claims made; and
Specifically, ads should refer to speed in a manner that is appropriate for the technology.
If the judicial review results in an approach similar to the one adopted either by the Italian or by the French regulator, it is likely to be seen as a success for CityFibre. However, uncertainties come from the current availability of ‘full’ fibre in the UK (either FTTH or FTTB) which is still relatively low, and potentially insufficient to conclude that fibre claims for an FTTC connection are misleading, since there is still little alternative available on the market.
It’s also unclear whether customers really rely on technology definitions to tell the difference between broadband offers, and whether they care about anything else than speed or performance. To this end, CityFibre has published recent research which differs from the findings released by the ASA in November with the review of the advertising guidelines. The ASA claims that the term fibre is not a priority or key differentiator for consumers choosing a broadband service, and that, once educated about the meaning of fibre, consumers do not believe they would change their previous purchasing decision; they do not think the word ‘fibre’ should be changed in ads of part-fibre products.
CityFibre’s survey reaches different conclusions, showing that consumers are not well informed about the technology of their broadband service. 86% of respondents thought the type of cable made a difference, but 65% didn’t think their connection relied on copper or hybrid copper-fibre, even though this is the case for most consumers. Once the difference between hybrid copper-fibre connections and full-fibre was explained, two thirds thought the advertising rules should be changed. While 65% said their broadband had been described as “fibre”, only 17% thought it would include copper cables.
