Is It Defamation To Mock Your Competitors' Promotional Campaign?

from the so-says-Shaw dept

It's amazing what a little competition can do. Apparently, up in Canada, cable company Shaw started running a promotion a few months ago where they dropped the price of 15Mbps broadband, 200 channels of TV, or voice service to about $10. However, apparently, this was (conveniently) only done in places where Shaw was going head to head with competitor Novus. In response, Novus put together an amusing marketing campaign, using all sorts of social media, encouraging Shaw customers in other regions (where they couldn't get this phenomenal deal) to contact Shaw to ask why not. It's a bit cheeky, but it makes the point: Shaw appears to be dumping its product in areas where it competes with Novus to cause trouble for Novus via predatory pricing.

Now, I'm all for competition, so I don't necessarily think that such pricing is a bad thing (though, people should be aware that it's unlikely that those prices can last), but that also means that the ad campaign by Novus is fair game as well. Not to Shaw, apparently. The company has now sued Novus for its marketing campaign, claiming that it's defamation. It's difficult to see how it's defamation to point out your competitors' own promotional pricing, but perhaps I'm missing something. Or maybe Shaw just figures that the defamation suit itself will get more publicity for its $10 offer. Marketing via lawsuit? Still, it seems that in going to court, Shaw may open up some legal doors it's best to avoid. A quick stroll through some online sources suggests that Canada does, in fact, have laws against predatory pricing. Getting this whole campaign more attention might also end up drawing the attention of some regulators, too...
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Filed Under: broadband, canada, dafamation, predatory pricing
Companies: novus, shaw


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  • identicon
    Anonymous Coward, 26 Aug 2009 @ 1:08pm

    "It's amazing what a little competition can do. Apparently, up in Canada, cable company Shaw started running a promotion a few months ago where they dropped the price of 15Mbps broadband, 200 channels of TV, or voice service to about $10. However, apparently, this was (conveniently) only done in places where Shaw was going head to head with competitor Novus."

    I think this is more evidence that broadband is generally COMPLETELY overpriced. So is cable television of course.

    reply to this | link to this | view in chronology ]

  • icon
    Jon B. (profile), 26 Aug 2009 @ 1:23pm

    Without reading the details...

    It might be defamation if Novus is accusing Shaw of predatory pricing and saying outright that the prices won't last. They would have to have a basis for a claim that Shaw's prices are temporary. That may be exactly what's happening, but how would you prove it enough to make that claim in an ad?

    reply to this | link to this | view in chronology ]

    • identicon
      Jesse, 26 Aug 2009 @ 1:38pm

      Re:

      "They would have to have a basis for a claim that Shaw's prices are temporary."

      Shaw reps will tell you that it only lasts for 1 year. That should be good enough.

      reply to this | link to this | view in chronology ]

    • icon
      Dark Helmet (profile), 26 Aug 2009 @ 1:39pm

      Re:

      "That may be exactly what's happening, but how would you prove it enough to make that claim in an ad?"

      And more to the point, if they sued for that and won, would that then preclude Novus from EVER raising prices in those areas? Because that would be an OUTSTANDING unintended consequence.

      One other thing to mention, however:

      "Or maybe Shaw just figures that the defamation suit itself will get more publicity for its $10 offer. Marketing via lawsuit?"

      This is what REALLY gets my blood boiling. If anything close to this was attempted in my state, I would do everything in my power to bring a class action lawsuit against the company doing so in the name of every tax paying citizen of the state for conspiracy to defraud the state, misuse of public funds, and anything else that made any kind of sense. How DARE this company muck up the publically funded legal system with their bullshit marketing campaigns.

      When I am running things, I can assure you my self-appointed inquisitors will have the power to immediately remove the sexual organs of the corporate leadership for any company that attempts to misuse the court system.

      reply to this | link to this | view in chronology ]

      • identicon
        Ryan, 26 Aug 2009 @ 2:04pm

        Re: Re:

        And more to the point, if they sued for that and won, would that then preclude Novus from EVER raising prices in those areas? Because that would be an OUTSTANDING unintended consequence.

        You mean Shaw? I agree, that would be pretty awesome. Shaw might decide to try to settle if they thought they might actually win...

        This is what REALLY gets my blood boiling. If anything close to this was attempted in my state, I would do everything in my power to bring a class action lawsuit against the company doing so in the name of every tax paying citizen of the state for conspiracy to defraud the state, misuse of public funds, and anything else that made any kind of sense. How DARE this company muck up the publically funded legal system with their bullshit marketing campaigns.

        Not sure why you'd blame the company, or how you would prove their motivation if thats what you're going by. This is why we need legal reforms--to put the cost on the private parties involved, depending on culpability. If a company can do this, its the legislature's fault for allowing such a stupid system to continue.

        reply to this | link to this | view in chronology ]

        • icon
          Dark Helmet (profile), 26 Aug 2009 @ 2:06pm

          Re: Re: Re:

          "Not sure why you'd blame the company, or how you would prove their motivation if thats what you're going by."

          Weren't you listening? No proof needed, I'm taking over the country and installing appointed inquisitors, not judges. The lawyers will be slaughtered like some kind of ultra-sleezy Jedi Council! Bwahhahahahahah...

          reply to this | link to this | view in chronology ]

        • icon
          Marcus Carab (profile), 26 Aug 2009 @ 4:01pm

          Re: Re: Re:

          Admirable Ideals + Whimsical Hyperbole + Hilarious Jokes = Darkhelmet.

          You'll love him before long!

          reply to this | link to this | view in chronology ]

  • identicon
    Jesse, 26 Aug 2009 @ 1:36pm

    Goliath tries to crush David....twitter shitstorm ensues

    I was a Novus customer last year, and a Shaw customer the year before. Novus is way better...as a smaller company they actually care a lot more about their customers. When you call them you don't feel like you're talking to a rep, but a human being, maybe even an old buddy.

    Novus has already filed lawsuit against Shaw for it's pricing scheme. Shaw's president went on record saying that it wasn't just targeting Novus customers, but the west end of Vancouver's competitive market. So I called up Shaw, because I'm living in the west end, but not in one of Novus' buildings, and asked for the rate. The rep told me, quite defensively, that the deal wasn't available in my building, only certain competitive buildings. I said, "Oh you mean buildings where Novus offers service." He said well not necessarily. I asked if there were any buildings where this deal was offered where Novus wasn't offered...no...I asked him, "If I were already a Shaw customer in one of those 'competitive' buildings, could I switch from my expensive rate to the $10 rate?"...well you get the idea, of course not.

    At one point, Shaw had reps waiting outside of said "competitive" buildings, asking residents if they were with Novus, and if they said yes, only then offering them the package. The package is $10 each for high speed internet, hi-def TV and phone. Those prices are an introductory rate that will last for a year. Even if I could get those rates, I would still stick with Novus. At least the reps won't lie to my face.

    "I think this is more evidence that broadband is generally COMPLETELY overpriced. So is cable television of course."

    While it is overpriced, in this case they are losing money. Other customers are paying $130 to fund this campaign to offer the same thing at $30 to people living in really rich buildings. While it may hurt Novus, I think the poor publicity will hurt them more. We have few other providers here so they don't exactly have a monopoly. Before this I was going to go with Shaw, because I can't get Novus, but now I'll try Telus or Rogers.

    Just look at the response at:
    http://twitter.com/10buckstoo
    http://www.10buckstoo.com/

    reply to this | link to this | view in chronology ]

    • icon
      Jon B. (profile), 26 Aug 2009 @ 2:30pm

      Re: Goliath tries to crush David....twitter shitstorm ensues

      Yeah, I figured it might be an intro price, but Mike didn't mention that part (and I didn't bother reading, so bad on me...)

      If you're right, it sounds like a problem that may work itself out.

      Except that filing baseless defamation suits should have consequenses...

      reply to this | link to this | view in chronology ]

    • identicon
      Joe, 26 Aug 2009 @ 2:32pm

      Re: Goliath tries to crush David....twitter shitstorm ensues

      I'm with Novus right now and they are the perfect example of how to breed customer loyalty. I pay about 70 dollars per month right now for a combination broadband and tv package and would not think for a second about taking Shaw's offer.

      Think of this as if Microsoft offered Mac users a nice dell laptop for 10 bucks if they would switch. Even with that, most would laugh right at them. I think it will be the same here.

      reply to this | link to this | view in chronology ]

      • icon
        Chuck (profile), 26 Aug 2009 @ 3:11pm

        Re: Re: Goliath tries to crush David....twitter shitstorm ensues

        And yet, if Apple offered Macbooks for $10, many wouldn't switch either. And I don't know why.

        reply to this | link to this | view in chronology ]

      • identicon
        Migzy, 26 Aug 2009 @ 3:28pm

        Re: Re: Goliath tries to crush David....twitter shitstorm ensues

        Hear, hear, I'm with you on that one and have told Shaw such when I told them to stop mailing me their 'current occupant' flyers once a week or more. One week I received 5 of them!! That on top of getting an ad under my door!

        reply to this | link to this | view in chronology ]

  • icon
    Danny (profile), 26 Aug 2009 @ 1:50pm

    If Shaw expects to maintain or increase their previous profit level, then the outlier Shaw customers are subsidizing these new $10 customers.

    It is a very nifty marketing idea to let the subsidizing customers know what is going on.

    And Shaw's lawsuit will only result in a Streisand Effect.

    reply to this | link to this | view in chronology ]

  • icon
    Blatant Coward (profile), 26 Aug 2009 @ 3:21pm

    I Smite Thee in the Holy Name of Elvis!

    200 channels and still ain't anything on. We don't need more channels, we need better channels.

    Charlie, fetch me my .45!

    reply to this | link to this | view in chronology ]

  • icon
    HolaJohnny (profile), 26 Aug 2009 @ 5:31pm

    Dark Helmet your right

    I completely agree now could you see your way to appointing me as a ultra sleazy Inquisitor then?

    reply to this | link to this | view in chronology ]

    • icon
      Dark Helmet (profile), 27 Aug 2009 @ 6:35am

      Re: Dark Helmet your right

      Sure, just pick what region you want:

      1. Deep, muggy southern district: pretty much all of the toothless states

      2. The Desert District: includes Texas, Arizona, Nevada, New Mexico, Southern Cali, and all the cacti and scorpions your heart desires

      3. The Fuck It's Cold District: Everywhere north of Milwaukee in a straight line from the Great Lakes across the country. Cheese, beef, a self-depricating view of life? It's all there. Oh, and some abhorence called The Mall of America, which probably should ACTUALLY be called the Mall of Ginormous Tourists and Their Whiny Kids

      4. The Northeast District: Odd sounding vowels and an overly high opinion of themselves. Plus, the women and ocean have a lot in common: they both can give you crabs

      5. The Dark District: Located around Chicago, it will be nicknamed Boobie Central as we'll be importing all of the good looking women from the other districts. Why? For pillows, man, pillows. Because I am Lord Helmet, and my officials and I ought to be able to go to sleep at night resting my head on a gaggle of desirable women.

      So, er, which district do you want?

      reply to this | link to this | view in chronology ]

      • icon
        nasch (profile), 27 Aug 2009 @ 8:08am

        Re: Re: Dark Helmet your right

        I think you left out some districts, like the Nothin' But Corn (Except Where There's Wheat) District, the Where Did The Air Go (ie mountain west) District, and the What Is That Bright Thing In The Sky (Pacific northwest) District.

        reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 27 Aug 2009 @ 6:06am

    Chuck:
    "And yet, if Apple offered Macbooks for $10, many wouldn't switch either. And I don't know why."


    You're on TechDirt and you are wondering why some people might want to avoid Apple? Try reading some of their licensing agreements some time. Or see what happens to battery life on your macbook when you try to run a competitor's OS through bootcamp. Or if you are worried about security, look at the results from the 2008 Pwn2Own conference.
    I'll stick with Linux, thanks.

    reply to this | link to this | view in chronology ]

  • icon
    nasch (profile), 27 Aug 2009 @ 8:12am

    Predatory pricing

    Now, I'm all for competition, so I don't necessarily think that [predatory] pricing is a bad thing

    Can someone explain how this makes sense? This is pricing designed to drive a competitor out of business or out of a specific geographic market, after which the prices can be raised to almost any desired level, because there's no longer any competition. How can you be pro competition and also OK with predatory pricing, since the latter destroys the former?

    reply to this | link to this | view in chronology ]

  • icon
    HolaJohnny (profile), 27 Aug 2009 @ 8:48am

    Tempting as it may be

    I'm not choosing the dark district. I'll go with What Is That Bright Thing In The Sky district. Back up off the Sasquatch they are our secret defense force.

    reply to this | link to this | view in chronology ]


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