Time Warner Cable agreed to stop advertising that it offers services over a "fiber-optic network," after a Council of Better Business Bureaus review board ruled against the cable operator on a complaint filed by Verizon Communications.
The setback for Time Warner Cable is part of a long-simmering battle Verizon has waged to force cable operators to drop claims they operate "fiber" networks. Verizon has invested some $18 billion in the FiOS fiber-to-the-home network, which passed 15.6 million homes at the end of 2010.
In May 2010, the National Advertising Division of the Council of Better Business Bureaus recommended that Time Warner Cable and Cox Communications stop describing their hybrid fiber-coax networks as "fiber-optic networks" in their marketing. Cox said it would take those into consideration in future advertising, while TWC appealed the decision to the group's National Advertising Review Board.
On Wednesday, the appeals board upheld the recommendation. According to the NARB panel, Time Warner Cable's claims conveyed "unsupported messages that TWC uses fiber optics for transmission throughout its entire network and/or that TWC's network represents the highest level of technology currently used by consumer telecommunications services providers."
In a statement, Time Warner Cable said it "respectfully disagrees" with NARB's decision but that it would modify or discontinue the advertising in question "to comply with the panel's decision."
TWC continued to maintain the claims challenged by Verizon -- including that its broadband "is zooming across the advanced fiber network" -- were fully substantiated.
"Time Warner Cable believes that the panel's decision denies Time Warner Cable the opportunity to truthfully and accurately describe its fiber-optic network in its advertising -- a practice which it has engaged in for two decades without any signs of consumer confusion or harm," the MSO said in a statement. "In addition, the panel's decision inhibits the ability of Time Warner Cable and other service providers to distinguish their services in areas where their competitors have indisputably inferior products."
Verizon has prevailed in similar complaints against Comcast and Cablevision Systems. Comcast declined to cooperate with the NAD's inquiry in the case, which was referred to the Federal Trade Commission, while Cablevision said it would take the group's findings into consideration in future advertising.
In response to the NARB panel decision, Verizon said in a statement, "Cable companies say the darndest things. It's unfortunate that some companies resort to making false and misleading statements about what they can deliver. When that happens, it leaves consumers confused."
The telco said it was "gratified of the NARB recommendation that helps to set the record straight in terms of how Time Warner [Cable] describes its network.... The truth is they can't honestly make those claims and the NARB recommendation affirms this fact."
In the Time Warner Cable decision, the NARB said that the last-mile architecture of service providers is "relevant to a network's performance capabilities."
"Prior NAD cases recognized differences between 'fiber to the home' networks and 'fiber to the node' networks, and the evidence in the present case shows those differences continue to exist," NARB said. "The record indicates that 'fiber to the home' networks are generally considered to represent the highest level of technology currently used for consumer telecommunications services."
