ACCC takes aim at mobile internet
The ACCC has announced the launch of an Information Paper entitled “Mobile and Other Wireless Internet Speed Claims and the Trade Practices Act 1974″.
The Information Paper has been developed to assist ISPs and Telcos in ensuring that their advertising for mobile and wireless internet is compliant with the Trade Practices Act 1974, and in particular the consumer protection provisions such as s52.
In launching the Information Paper, ACCC Chairman, Graeme Samuel said that:
“The ACCC is concerned by companies over-promising and under-delivering the speeds available on mobile and wireless internet, particularly in the context of network upgrades and increasing wireless internet subscriptions,” “This Information Paper is intended to assist the whole industry – mobile and wireless internet retailers, resellers, and network owners – to comply with the law.”
The ACCC has warned ISPs/Telcos not to advertise terms such as ‘maximum’, ‘up to’ or ‘peak network’ speeds, “if those speeds are not generally achievable or likely to be achieved by consumers using the network.”. The ACCC warning indicates that it is taking a similar approach to that previously taken with ADSL2+ advertising.
The ACCC has expressed the view that ISPs/Telcos should:
- only make speed claims based on ‘appropriate tests of network performance’ to show speeds that can generally be achieved; and
- prominently state the factors affecting mobile and wireless internet speeds such as congestion, location, and other variables.
The Information Paper also contains an Industry Checklist to assist with compliance – ISPs/Telcos are reminded that they should also remember to ensure compliance with CommsAlliance Code C628:2007 TCP Code (Prices Terms and Conditions). Significant effort must be applied in light of the ACCC’s warnings and recent actions in securing enforceable undertakings against some of Australia’s largest ISP/Telcos.
ACCC executes perfect hit on Telstra, Optus and Vodafone
After months of secret negotiations, Telstra, Optus & Voda have rolled over and ‘offered’ ACCC a court enforceable undertaking … equivalent to court injunctions … to stamp out false advertising in the broadband and telephony industry.
When legal advisers warn second and third tier telcos and ISPs about advertising content, the single most common retort is ‘Telstra gets away with it’ and ‘We saw an Optus ad like that’ and ‘But Voda says the same thing’.
It’s a pretty good argument. If the giants can do it, why can’t we ?
No mistake, this is the biggest telco-truth-in-advertising hit ever landed by the national regulator. Like all good commando raids, it seemed to come from nowhere. Only yesterday morning did rumours start to circulate that ‘something big’ was coming out of Canberra in the next 24 hours.
If Tiers 2, 3 & 4 don’t get their act together now, they can’t complain they’re being picked on. And ACCC has made sure that Telstra, Optus & Voda are motivated to keep their networks honest.
Bank of Queensland finances telco scam
Finance companies are racing against time to squeeze money out of Australian small businesses before a major Federal Court case shows that their contracts are unenforceable.
Two separate groups of telco companies promoted the notorious telco equipment / finance / servces bundling scam that has cheated businesses of millions of dollars, saddling them with massive debt for goods and services never supplied. One of these groups has been taken to court by ACCC, which is determined to smash its illegal conduct.
Watching on the sidelines are the financiers of the other group. It doesn’t take much to figure out that they won’t be able to recover their dodgy debts after the Federal Court case against the first group is over. So the finance companies are grabbing as much cash from innocent business operators as they can before the ACCC shuts the gate.
And Bank of Queensland’s equipment finance subsidiary is one of the players. Yes, that’e the same Bank of Queensland that denies all responsibility for the outrageous lending practices of failed Storm Financial.
SMS spammers suffer ‘no show’ judgment
We reported in January 2009 that ACMA had launched legal action against a bunch of companies and individuals alleged to be involved in an illegal SMS spam racket.
Five of the respondents to the Federal Court action have failed to take necessary procedural steps, and the Court has agreed to ACMA’s application for default judgments. After hearing evidence about the defaults and the original conduct, the Court has ordered:
- that parties including Mobilegate Ltd, Winning Bid Pty Ltd, Simon Anthony Owen, Tarek Andreas Salcedo and Glenn Christopher Maughan have breached the Spam Act and / or Trade Practices Act in various ways;
- that they be restrained from certain conduct, of the kind involved in the scam, for seven years; and
- the matter be re-listed for directions in relation to any penalty hearing as the above respondents on 18 September 2009.
The case against other respondents, who have defended the case, continues.
Telstra fined for Do Not Call breaches
Telstra has paid a $101,200 infringement notice for telemarketing to numbers on the Do Not Call Register more than 30 days after they were registered.
ACMA announced its biggest scalp yet under the new law, following an investigation into calls made by an offshore call centre on behalf of Telstra. Inexplicably, Telstra allowed illegal calls to continue after ACMA had raised concerns based on several complaints.
“The investigation found that inadequate compliance systems, procedures and supervision had contributed to calls being made to numbers on the Register where the consumers were not existing Telstra customers.”
Telstra may be the biggest Do Not Call catch so far for ACMA, but it’s not the record penalty payer. That ‘honour’ belongs to Dodo at $147,400.
Spot Check: Are your price reduction ads putting you at risk?
NEW mobile phone!! WAS $399 NOW $199!!
BRAND NEW phone!! $199 – SAVE over 50%!!
Ads that show ‘two price’ or ‘was / now’ pricing are common, effective and legal … provided they’re not misleading. There are special rules about how to get ‘was / now” pricing ads right. While care needs to be taken, getting it right is relatively easy.
Getting it wrong can be costly, as the former owners of the Zamel’s jewellery chain have found – the ACCC took them to court over allegedly misleading ‘was / now’ price ads in one of their catalogues. In January 2009, the court handed down a fine of $380,000.
ACCC hauls Optus into Federal Court
In the latest action in its war on trade practices non-compliance in the telco sector, ACCC has taken Federal Court action against a wholly owned subsidiary of Optus Mobile Pty Ltd.
Prepaid Services Pty Ltd supplies phone cards that are resold by an independent company Boost Tel Pty Ltd.
ACCC alleges that Prepaid and Boost were involved in false advertising.
Component pricing seminar notes available
Seminar notes from today’s popular ‘Component Pricing Law’ seminar at Logie-Smith Lanyon Lawyers are now available for download.
Delivered in our trademark style … plain english guaranteed … the seminar offered practical and expert insights into living harmoniously with the new trade practices law.
We’ll offer a repeat session soon … keep watching.
FunnyTel introduces unit pricing in new mega-value FAT plans
Comms industry leader FunnyTel today announced its ground-breaking FAT plans.
No stranger to innovation – FunnyTel was Australia’s first ISP to introduce the random number billing that has since proved so popular with Telstra management – the FAT plans include Australia’s first internet unit pricing scheme.
‘We read about the Government’s idea for unit pricing with groceries,’ says FunnyTel spokesman Chad Blake. ‘And we thought “This makes sense.” Why should customers pay for an 80 gigs download allowance and not know exactly how many P2P movies they’ll get for their dough ?’
‘We’re actually thinking of applying to the ACCC for an award for this,’ said Blake. ‘Our 2 New Hollywood Releases a Night’ plan is a revolution in truth-in-advertising. ‘And that’s A-FACT !’ says Blake with a cheeky wink.
We asked Chad if he thought that other market leaders like iiNet would adopt the system.
Read more
National consumer law Bill hits Parliament
On 24 June 2009, the Government introduced the Australian Consumer Law Bill into Parliament. It represents the biggest shake up of Australian consumer law in a long time.
From 1 January 2010, the Government intends that we’ll have a national unfair contract terms law. ACCC will have power to demand that advertisers positively substantiate any claims they make. And there’ll be new penalties, enforcement powers and options for compensating consumers.
Stay tuned to CSP Central for plenty of news and expert commentary about the new law. We already have some detailed comments on one misconceived part of the drafting.
Links