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ACCC Cracks Down On Misleading Telco Advertising

Telstra, Optus and Vodafone have been put “on notice” by the ACCC for misleading advertising. The regulator has warned Australian telcos to remain “clear and transparent” or risk court action.

The ACCC claims proceedings will also come against executives who knowingly approve misleading ads.

The news follows Optus and Telstra’s legal battle over “unlimited” mobile data, coupled with an ACCC investigation.

The watchdog claims during March – June 2018, Optus, Telstra and Vodafone’s “unlimited” mobile data ads [“in most cases”] did not sufficiently outline usage limitations.

  • Optus’ ‘unlimited’ plan imposed a 1.5Mbps speed restriction on tethering, streaming and downloads. Heavy data users could also be deprioritised during congestion.
  • Vodafone’s ‘unlimited’ plan provided an initial data allowance at usual speeds, after which all usage was speed capped at 1.5Mbps.
  • Telstra’s ‘unlimited’ plans provided 40GB at usual speeds, after which all usage was slowed to 1.5Mbps and slowed further during busy periods.

As previously reported, the federal court ruled Telstra’s marketing tagline “One word for Australia’s best mobile network: Unlimited” misleading and deceptive, and in contravention of the ACL.

The court claims Telstra did not adequately inform consumers ‘unlimited’ services were subject to usage limitations and exclusions.

Following the Federal Court’s findings, Optus, Telstra and Vodafone have ceased using the tagline “unlimited” in mobile data ads.

“We have taken a range of actions against telecommunication companies for misleading consumers. It is about time they showed more respect for their customers and the Australian Consumer Law,” claims ACCC Chair Rod Sims.

“With much higher penalties now available for breaches of consumer law, I hope they will take their obligations more seriously. From now on consumer law penalties will seriously affect their bottom line, and we will not hesitate to seek the highest possible penalties.”

As previously reported, on September 1st ACL contraventions tripled to over $10 million, with penalties against individuals soaring from $220,000 to $500,000.

Further information is available on the ACCC’s website here.

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