3-year ban on Optus 'Think Bigger' ads

3-year ban on Optus 'Think Bigger' ads

Summary: Optus has been served with a three-year injunction preventing it from conducting similar advertising campaigns to its "Superfast" and "Think Bigger" broadband ads.

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Optus has been served with a three-year injunction preventing it from conducting similar advertising campaigns to its "Supersonic" and "Think Bigger" broadband ads.

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(Iniqpak Tuttuvak (City Moose) image by echoforsberg, CC BY-SA 2.0)

The Federal Court ruled earlier this week that Optus had misled customers in its "Superfast" and "Think Bigger" advertising broadband campaigns by not clearly indicating that once a user went over their peak or off-peak download limits, their access would be throttled to 64 kilobits per second. By not doing this, the company had breached the Trade Practices Act, according to the ruling.

As a result, Justice Nye Perram yesterday placed an injunction on Optus, preventing the telco from engaging in similar advertising campaigns for a period of three years. He also ordered Optus to pay all of the Australian Competition and Consumer Commission's (ACCC's) court costs.

The ruling was welcomed by ACCC chair Graeme Samuel.

"This judgment reinforces the ACCC's long held position that this approach is not acceptable commercial practice and does not reflect what the law requires," Samuel said in a statement yesterday. "Companies cannot rely on their call centres to correct advertisements that have misled and deceived people.

"Consumers were told in these ads that they were going to get a certain amount of broadband, and it's only after you work through confusing and vague disclaimers that you realise that it's just not the case. Consumers and the ACCC are, frankly, tired of telcos using complex, confusing and deceptive advertising to fool consumers. This should serve as yet another reminder, that if these companies don't clean up their act, the ACCC will be here to take you to task and you can expect to be hit with the full force of the law."

For its part, Optus argued in the course of the trial that the advertisements were not in breach of the law because customers didn't make purchasing decisions on the basis of advertisements alone, and would have been informed of the limits of the plans either via the Optus website or by Optus' sales staff.

A decision on what corrective advertising and what monetary penalties might apply to Optus is expected to be made at a later date.

Updated at 1:01pm, 8 December 2010: we incorrectly reported that the court issues were with Optus' Superfast plans. It was actually the carrier's Supersonic plans.

Topics: Broadband, Government, Government AU, Telcos, Optus, NBN

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Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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13 comments
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  • I understood what Optus was offering, perhaps because I have used Optus before,
    and that 64K throttling would occur when the download allowance was exceeded. Seriously, did anyone believe the offer was totally without conditions or they'd have an totally unlimited/unrestricted download?

    As for advertising promising unbelievable deals....that should be a clue! Caveat Emptor applies to the buyer, and if you aren't going to review that unbelievable deal then expect to get what you deserve!

    Have you ever noticed it's always those who are most tight with their money that bleat the loudest when they happily sign up to the latest 'free', 'cheap', 'unlimited' deals and later find them not what they thought. That's because they blind themselves with perceived savings, letting that over-rule any rational thought.

    Sure, all industries (including telcos) should be forced to simplify their contractual dealings for standard consumer dealings. However, being a tight a** and then complaining when you get sucked into an obviously unbelievable deal is your own fault.
    Scott W-ef9ad
  • I don't think it's unreasonable to beleive what companies tell you. If they advertise something as unlimited, then why would it be unreasonable to think it's unlimited?

    Putting a little * next to the word unlimited and then list out all the limitation later doesn't mean you can outright lie. It's a well understood term, if you say it's unlimited, and it isn't then you lied.
    m00nh34d
  • Sorry Scott - what you are suggesting implies that all advertising should be treated as false or with great skepticism unless proven otherwise. Hardly a good basis for marketing communications or building consumer confidence. Many people are still not aware how broadband plans work and are therefore not experienced enough to apply the appropriate cynicism in assessing the offer.

    In any case, saying the customer is unreasonable for complaining when they are caught out is the usual strawman argument of blaming the victim rather than the perpetrator. The 'They asked for it' defense.
    Kimota-04d8e
  • @Scott W: "Seriously, did anyone believe the offer was totally without conditions or they'd have an totally unlimited/unrestricted download?"

    Seriously, do you work for Optus? The issue, as you probably know very well, is not the fact that there were conditions but that the conditions were contrary to the impression deliberately created, and were virtually impossible to read as stated by the judge.

    Please note and tell your colleagues that you can't call people tightarses because they have been victims of misleading advertising.
    gnome-8be8a
  • Well how about my past experience with these mongerels when they made me an attractive offer then switched & billed me to a dearer plan without notification.
    When I complained their rep lied to me in insisting my plan was discontinued & no longer available yet a quick check showed it was still being widely advertised to lure in more victims.
    Needless to say I now have nothing to do with Optus!
    grump3
  • Optus means "choice". I choose almost anything but Optus. I AM on an UNLIMITED, unthrottled plan with another carrier.
    Treknology
  • I think that Optus deserve what they get but cant help thinking there are bigger issues the ACCC could be focussing on. Like how can companies get away with charging hundred fold for excess data than for data on plan? Personally, I would rather be shaped unexpectedly than get a bill for thousands of dollars.

    Look at some of the Vodafone plans that include data charges in caps and you cant tell me there arent people with iPads and whatever being hit up with massive excess data (and phone) bills after their cap dried up in about 2 minutes.
    xBeanie
  • To answer your first question: It's unreasonable to assume an unbelievable offer is believable.

    On the second point I agree. A good business makes it's product offerings as easy to understand as possible BUT shouldn't be allowed to hide important details. Mind you, if you don't read the fine print behind that asterisk then who have you got to blame?
    Scott W-ef9ad
  • I'm not suggesting all advertising is false, or should be considered such. All that is required is some healthy skepticism when taking any offer into consideration.

    We've seen mobile phones go to a contract model, one in which very few people read or understand what they are signing into. I don't see a need for the overly complex contracts and suggest they be simplified. Less confusion, less dispute, less gotchas, and hopefully an easier selling technique.

    If you're caught out, then you have to determine why. Was it really misleading advertising or was it the greed of a good deal that blinded you to the facts? If it's clearly misleading, that's one thing. However, too many people these dfays blame the provider after they blindly signed up to a deal without any consideration.
    Scott W-ef9ad
  • No, I have never worked for any telco. Yes, I do use Optus for some services.

    I'm not disputing that false or misleading advertising should be stopped. In the Optus case I'm not convinced it was misleading....Optus has been using throttling for many offerings and I recall seeing that mentioned (in fine print) in the ads. Perhaps that was added later, but I don't see their ads as any more misleading than most.

    I know tightarses who have been victims of their own stupidity, and these are the ones that bleat the most when their miracle product/service fails to deliver on their expectations. This is where Caveat Emptor applies. Every seller should be honest with their offerings and every buyer has the responsibility to confirm their understanding of the offer.
    Scott W-ef9ad
  • If that is true, you should have formally complained and/or reported them to the ACCC.

    Offering a non-existant service as a lure to a different service (bait and switch) isn't legal.
    Scott W-ef9ad
  • More clarity in advertising is required for all businesses. Clarity comes with basic, understanable terms and conditions. Often companies have to make these more complex than necessary to cover themselves from a few who will exploit any loopholes. Add to that risk mitigation and you end up with ridiculous ads (eg. radio)where the last 10 seconds of a 30 second ad is all rapidly spoken legalese.
    Scott W-ef9ad
  • What is unbelivable is the Product mgrs and Product Marketing Mgrs at the telcos have the TPA drummed into them, with compliance tests annually... yet they allowed this silly and basic mistake.
    FiberLover