Is it really "unlimited" ?: Mistakes in advertising

12 02 2009

The ACCC’s recent action against Internet Service Provider TPG is a timely reminder for Telcos and ISPs looking to use the word ‘unlimited’ in their advertising.

The ACCC announced yesterday that it had sought and received enforceable undertakings (these are for practical purposes, very similar to a Court order) from TPG, for statements which it believed were misleading and deceptive to consumers.

The ACCC alleged that in advertising its Unlimited Cap Save plan, TPG engaged in misleading and deceptive conduct by making false representations that its plan:

  • includes unlimited calls and text for $59.99 per month when, in fact, there are multiple exclusions to the plan (including calls to 1800, 13 and 1300 numbers, directory assistance, international calls and SMS, calls to MobileSAT, premium SMS, and calls to operator assistance), and
  • is available for the purchase price of only $59.99 per month when, in fact, the minimum charge for the Unlimited Cap Saver Plan is $79.99 due to an additional $20 SIM card fee payable on registration

Besides being a public relations disaster with customers, advertisements which are misleading and deceptive are plain and simple illegal.

TPG learnt the hardway. According to the ACCC, TPG undertook to:

  • not, for a period of three years, publish an advertisement for a mobile telephone plan which states that for a specified price there will be unlimited calls and text when certain calls and text are excluded or additional charges will apply for some calls and text without including an appropriately prominent disclaimer to the effect that exceptions, terms and conditions apply
  • publish a corrective notice on its website
  • implement a trade practices law compliance program which requires all relevant staff and management to take part in training.

This is not a good outcome, considering this could have so easily been avoided.

Telco’s and ISP must remember that if there are conditions around an offer then they must make it clear what those conditions are. Failure to do so may lead to a breach of s52 and s53 of the Trade Practices Act 1974.

It is also a requirement of the Telecommunications Consumer Protections Code 628:2007 that where the word ‘unlimited’ or equivalent is used that, the Telco or ISP:

must ensure that it identifies which elements of the offer are “unlimited” and states any other conditions that may qualify the offer.

It isn’t to hard to comply, just be honest in advertising, and where there are conditions around an offer, let people know. If you are not sure, just ask your lawyer.

    Need an expert law firm
    you can trust to help with registering a trademark?

    Contact us today for a free 30 minute consultation for your expert legal advice today

    Get your Free Consultation

    Some of the clients we have worked with