Empathy for Optus

Optus yesterday was fined $178,200 over adds for a "Max Cap" plan in July and August last year. Reporting on the story in the SMH Lucy Battersby says that Optus doesn't agree with the claim that the ads were misleading but moved to replace them immediately.

In an opinion piece also in the SMH Elizabeth Knight writes;

The reality is that the ACCC spends a ridiculous amount of time dealing with exaggerated or plain fictional marketing claims made by telcos. It is hard to find someone who hasn't got some beef about their telco service provider or mobile phone bill.

Given that she then recites some of the language that David Howarth so delightfully ridiculed as I noted in a column for itNews it may surprise you that I feel some empathy for Optus.

The reason is simply that there is so much inconsistency in the operation of the law of misleading and deceptive conduct. Optus in this case was pursued by the ACCC and took the decision to change their practice to avoid a lengthy argument. The fine they have been asked to pay is less than the annual salary of their corporate counsels.

Meanwhile last December Optus initiated its own action against Vodafone over the latter's "infinite" plans. They were unsuccessful in gaining an injunction and have since dropped the matter. But it was the judgement in the injunction that was extraordinary.

Elizabeth Knight notes that "It's true that the more sophisticated consumer understands that there are plenty of calls that are not covered by a cap, but in some cases the fine print exclusions are a fraction the size of the headline marketing claims."

But Justice Nicholas stated in his judgement (at para 19);

It also needs to be remembered that ordinary and reasonable consumers, who might be expected to take some care of their own interests, are likely to do more than simply rely upon these particular television commercials in deciding whether or not to sign up to the respondent’s plan. These types of plans typically involve a contractual commitment of a year or more in duration and are invariably the subject of terms and conditions which relate to matters of detail of the kind that the applicant’s complaints focus upon.

According to this decision it doesn't really matter how much the actual terms vary from the advertised terms because the customer is LOCKED IN TO those terms the customer has an increased obligation to read and understand the full terms before acquiring the service.

Optus not only lost but has been required to pay Vodafone's costs. It would be interesting to know which amount is higher, the fine they just received or the cost of their failed litigation.

Personally I think Optus over-stated the case; they listed all the call types not included in the Voda plans. A focus only on 1800 and 13/1300 (in line with ACCAN's Fair Calls for All campaign may have been easier to argue.

So in defence of telcos and others, it is very hard to win the internal battle on compliance when the external rules are vague and inconsistently interpreted.

Novae Meridianae Demetae Dexter delenda est