The Advertising Standards Authority (ASA) has rejected a complaint made by BT against BSkyB's "free" broadband campaign last year.

BT complained to watchdogs that Sky falsely advertised its broadband offering as "free", since customers had to pay a £40 connection fee. Sky rolled out the service in summer last year, soon after TalkTalk had caused a rumpus with the first "free" broadband offer. In that case the ASA ruled against the advertiser.

The ASA disagreed with BT's misgivings, and accepted Sky's explanation that its direct marketing campaign was not misleading, since the connection charge was spelled out on the back of the mailing in small print.

The ASA said it in this case it had reminded Sky that it was only allowed to call its broadband "free" for a while, since customers would soon view it as an inclusive service rather than a bonus. Since it launched its "See, Speak, Surf" package in January, Sky has instead marketed broadband as part of a triple play bundle.

The regulators have come in for consumer criticism lately for alleged soft treatment of broadband providers. A petition is calling on the government or Ofcom to act against "unlimited" download claims and other tricksy marketing practices.

In response to Wednesday's adjudication, a BT spokesman told The Register: "We would welcome clearer advertising from Sky."

BT now finds itself in a similar position to Virgin Media, competing with Sky on several fronts. The national telco recently launched its own pay TV platform, BT Vision, while Sky now offers own-brand broadband and home phone services.

There hasn't always been needle between BT and Sky. In 2002 they signed an accord which saw Sky punt broadband to its TV subscribers, and BT market satellite TV. The mutual back-scratching was a response to resurgent competition from cable operators. ®

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