Did the court declare Telstra's LTE as 4G?

Did the court declare Telstra's LTE as 4G?

Summary: Apple was found to have misled consumers in Australia with the "4G iPad" label, but the question remains: does this case now set the standard for 4G in Australia?

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TOPICS: Apple, iPad, Telcos, Telstra
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Apple was found to have misled consumers in Australia with the "4G iPad" label, but the question remains: does this case now set the standard for 4G in Australia?

New iPad event

(Credit: CNET)

Apple will hand over $2.25 million for claiming that the new iPad was 4G, despite the fact that it cannot operate on Telstra's long-term-evolution (LTE) or "4G" network.

But does this mean that the court has mandated that Telstra's 4G is true 4G?

Not really, but it has declared that Telstra has set the tone for what customers expect from 4G.

The International Telecommunications Union (ITU), which declares mobile standards, has described what it expects from 4G services, but has yet to declare that LTE networks like Telstra's meet the standard for 4G.

Bromberg's ruling essentially focused on the notion that because Telstra has marketed its LTE as 4G within Australia, that's what people are expecting:

No Australian carrier uses the term "4G" to describe any network which operates on HSPA, HSPA+ or DC-HSDPA networks. Those networks have always been referred to by Australian carriers as "3G" networks. Apple has also referred to those networks as "3G". Since the launch of Telstra's LTE network, Telstra has extensively promoted that network as a "4G" network, which supports substantially faster download and upload speeds, as well as providing a more responsive internet connection, as compared with those provided by "3G" networks.

So, Telstra getting in early and marketing LTE as 4G has set the standard in Australia.

Justice Mordy Bromberg said that Apple would have been aware that this is how 4G was already being marketed in Australia by Telstra when it launched the new iPad, yet it still decided that keeping the iPad labelling consistent was more important than having accurate advertising. He said that this conduct was "serious and unacceptable".

"[It] suggests that Apple's desire for global uniformity was given a greater priority than the need to ensure compliance with [Australian Consumer Law]," he said.

"Multi-national corporations, who (through their subsidiaries or otherwise) operate in and profit from the Australian market, must respect that market and the laws which serve to regulate it and protect its participants."

How exactly do you punish a company as big as Apple? A fine of $2.25 million is probably what CEO Tim Cook can find down the side of his sofa. Nevertheless, Bromberg said that a strong message through a substantial penalty is required for Apple's actions. He admitted that it is fairly fruitless, mind the pun:

I harbour a concern that the size and financial strength of Apple diminishes the meaningfulness of the penalty proposed. However, I do not perceive any further transgressions by Apple to be likely. The fact of the litigation and the media attention which it has drawn will no doubt be a sober reminder to Apple, and others who rely on their brand image, that as well as a penalty, there will likely be an intangible cost involved in a contravention of Australian consumer law.

Given that Apple changed its branding for the new iPad across the globe, and taking into account how high profile this case was, I doubt we'll see any other vendor trying something similar anytime soon. So, even without the penalty, I would say that the ACCC would have been pleased with how well the case went.

Did Apple get its just desserts? Or was the case entirely overblown?

Topics: Apple, iPad, Telcos, Telstra

About

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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3 comments
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  • I'm not sure you can say that Telstra's LTE network is not recognised the ITU as "4G". Originally, when LTE-Advanced and WIMAXX2 were declared 4G, yes, nothing else was considered 4G. But the ITU actually relented in 2010 and said that"

    "As the most advanced technologies currently defined for global wireless mobile broadband communications, IMT-Advanced is considered as “4G”, although it is recognized that this term, while undefined, may also be applied to the forerunners of these technologies, LTE and WiMax, and to other evolved 3G technologies providing a substantial level of improvement in performance and capabilities with respect to the initial third generation systems now deployed."

    Now, I don't think you could class DC-HSDPA as 4G, seeing as it is only an increase, in the real-world, from about 3Mbps to around 8Mbps. While LTE goes from 8 Mbps to 25Mbps. Although there would appear to be some leeway. However seeing as ONLY AT&T has tried to do this (and been lambasted over it often), I think it's reasonable to conclude LTE could be considered 4G, but NOT DC-HSDPA

    Apple knows all this and yet they chose to market "4G" anyway, knowing full well the "real" 4G in this country was not compatible. It boils down to, for me, the fact that they chose to use the marketing term on purpose, to increase the appeal of the "new" iPad, while admitting that that marketing term was essentially pointless and misleading in this country.

    This is false advertising. Did lots of people complain? Did lots of people get refunds? Was there riots about low speeds on the "new" iPad? No. That's not the point. It is misleading advertising. Let them get away with this and soon we'll be inundated with buzz words and over the top promises nobody is using or keeping. That's why the ACCC are here.
    seven_tech
    • The key phrase in there "while undefined".

      In other words, the ITU hasn't defined LTE WiMAX etc as 4G but it is aware that companies are marketing these as being 4G.

      And they are the forerunners to 4G, no doubt.
      Josh Taylor
  • Late observation

    I know I am commenting well downline, but I must say my peace. Having stupidly just bought a Telstra 4G device, I began researching the matter of 4G standards in Australia, and I must say - as a relative newcomer to the country - Australians are being totally hoodwinked by the Telcos (amongst others). The ruling in the Apple matter is absurd. It smacks of parochial protectionism of the worst order. There are global standards for 4G and our networks are not that. So when a company enters a product that actually is 4G, rather than address our local concerns, we fine the outsider. Apple's product is actually 4G. The moral weakness lies in our telco's engaging in false marketing. If the public new that Australian 4G was not actually 4G by global standards, they could have simply made an informed choice about the iPad. There are way too many instances in this country of things just not being what they claim to be. In my opinion, that is what needs to be addressed. The fine was small because it was token. No doubt it was bargained for. At the cost of not embarrassing both the public and private sector in Australia.
    Nicholas McDiarmid