Amaysim and Lycamobile slapped with fines over alleged misleading ads

The Australian consumer watchdog alleges the pair were offering 'unlimited' data to consumers despite the advertised plans having data caps.
Written by Aimee Chanthadavong, Contributor

Amaysim Australia and Lycamobile have each paid a total of AU$126,000 in penalties after the Australian Consumer and Competition Commission (ACCC) issued the mobile service providers with infringement notices for alleged false or misleading representations about their mobile phone plans.

The consumer watchdog alleges that each business separately advertised on social media that their mobile phone plans were offering "unlimited" data to consumers on social media, when in fact each of their plans had a maximum data allowance. For those plans, if customers exceeded those capped amounts, they would be subject to additional charges, according to the ACCC.

The ACCC alleges the messaging on the ads were a breach of Australian Consumer Law and likely misled consumers.

"Consumers who saw the word 'unlimited' in the advertisements without any explanation of the limits of the plans were likely to expect they would not be charged additional fees for mobile data, no matter how much data they used," ACCC chair Rod Sims said.

"The telco industry has been previously put on notice that their advertisements must be clear and transparent, and must not contain claims like 'unlimited' without a clear and prominent disclosure of any qualification or exception which applies to the offer."

This is not the first time the companies have landed in hot water with the ACCC for misleading conduct.

The ACCC took legal action against Amaysim two years ago on claims that the company made false and misleading ads about discounts on the company's energy brand, Click Energy. At the time, the ACCC described Click Energy's advertising as being "among the worst practices" it had seen in retail electricity.

Lycamobile has also been fined previously for failing to comply with the Telecommunications Consumer Protections Code.

In 2018, the ACCC warned Telstra, Optus, and Vodafone about using the word "unlimited" in their advertising to promote mobile data plans.

Meanwhile, Communications Minister Paul Fletcher has issued a statement of expectations to the ACCC "so that the government can clearly set out its priorities and perspectives, for the independent regulator to take account of as it goes about its work" around how it deals with NBN wholesale prices, business market competition, and spectrum.

The statement, according to Fletcher, addresses the federal government's "preference" toward wanting the ACCC to make changes to the NBN's special access undertaking. He also encouraged "sustainable investment, domestic, and international competitiveness, national security, access to services and the efficient deployment of new networks and technologies" in the statement.

See also: Bravo ACCC: Telstra begins flogging NBN overprovisioning as 15% speed boost

The ACCC will now be "expected" to provide a statement of intent in response to the federal government's statement of expectation within the next three months, Fletcher said.

Elsewhere on Thursday, Optus tested the speed of its 5G network on a live network in Sydney, and boasted that it managed to deliver download speeds of over 2.5Gbps on a Samsung Galaxy S20 5G device.

The Australian telco said it worked with Ericsson and Samsung as part of the test, which used mid-band spectrum and 5G carrier aggregation.

The test comes ahead of Optus' plan to launch a further 150 5G sites by November in selected areas across Sydney and Melbourne.

"As they roll out, these new ultra-high-speed sites will provide a real speed boost to Optus customers with capable 5G handsets and 5G SIM," Optus managing director networks Lambo Kanagaratnam, said.

"The speeds we have achieved today are a real taste of what we are capable of delivering to Optus 5G Mobile customers in the coming months as we progressively roll out 5G ultra-high-speed sites in Sydney and Melbourne."

In addition, the telco announced that from next month, it plans to make 100Mhz of 3500Mhz mid-band spectrum available to 5G Home Internet customers in selected areas of Sydney and Melbourne. It touted that those currently experiencing average download speeds of 214Mbps would receive a 60% boost on average speeds.

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