Optus ends 'unlimited' ads court case with Telstra

Optus has said the legal judgment in May 'vindicated' its decision to take Telstra to court over its 'unlimited' ad campaign.
Written by Corinne Reichert, Contributor

Optus has confirmed the end of its Federal Court battle with Telstra over the latter telco's "unlimited" ads, saying the judgment "comprehensively vindicated" its legal action.

"Optus took the action against Telstra because it felt the advertisement was likely to mislead consumers," a spokesperson said.

"Our action has been comprehensively vindicated by the judgement and the offending advertisements have been removed from the market. Optus welcomes the closure of this successful action."

As reported by Computerworld, Optus did not say whether it reached an out-of-court settlement with Telstra.

The hearing had been due to take place on Thursday in Sydney after Optus in June said it wanted access to Telstra's business records to determine how many customers its "unlimited" campaign caused the former to lose.

This followed the court in May granting an injunction preventing Telstra from continuing its "unlimited" mobile advertisements, after finding they constitute misleading and deceptive conduct.

According to Justice Gleeson, Telstra's advertisements "falsely convey the representation" that the telco offers a mobile product with no limits on data speeds, data volumes, and the ability to download data without interruption or delay, misleading the public on the nature and characteristics of mobile products including the geographical reach of its network.

This is in contravention of both Australian Consumer Law and the Competition and Consumer Act, Gleeson J said at the time.

During the initial hearing, Telstra's billboard and online ads that state, "One word from Australia's best mobile network: Unlimited" had come under fire.

Optus counsel Richard Lancaster SC had argued that Telstra's usage of the word "unlimited" is misleading, because ordinary consumers would be likely to think unlimited applies to characteristics across data speed, data volume, geographical reach, and availability across devices.

"Unlimited is a powerful word," Lancaster said, adding that Telstra's ads cause "a misleading impression intentionally created to draw consumers into the marketing web" and are "misleading and false".

"Its lack of specificity is in fact a huge part of the problem, because it invites consumers to think about what is important to them about a mobile network ... and telling them those are unlimited."

Speaking from her personal reaction to the word "unlimited", Justice Gleeson said she immediately inferred that it meant an unlimited network geographically with an absence of blackspots. Her second impression was that it would enable customers to stream videos wherever they go without issue.

Dispelling these impressions would require effort from the consumer to travel to a Telstra store and speak to an employee, Gleeson J pointed out, which she said could "pique fury".

"The idea that someone will then go and explore this through the internet is not such an imposition on the consumer; what I find more troubling is that someone would schlep to a Telstra shop to find out ... that in fact there was nothing relevant for them," Gleeson J said.

Throttling speeds after using the initial 40GB of data each month also leads to "usage that makes you miserable", the judge said, questioning whether Telstra wants "miserable customers".

Counsel for Telstra argued that the ads are not misleading because a reasonable reading of them would not expect the word "unlimited" to be applied to every single feature of every single product on offer from the telco.


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