ACCC fines Telstra

Australia’s largest telecommunications provider, Telstra, has paid a $102,000 fine, after the ACCC issued it with an infringement notice, for a misleading iPhone 6 advertisement.  

The advertisement, which appeared in The Age newspaper on 27 September 2014, featured a large photo of an iPhone 6 and displayed the plan cost as $70. Hidden in the fine print was an $11 additional handset cost which took the actual minimum plan price to $81.

ACCC chairman Rod Sims said, “Consumers should be able to understand the true cost of an advertised product so they can make informed purchasing decisions,” and that “Businesses must be careful about using attention-grabbing headline prices to ensure that their advertisements do not mislead consumers about the actual price they will have to pay. This is especially the case for bundled goods and services like phones and plans,”

A Telstra representative said that the company was surprised to receive the infringement notice and that the advertisement was in line with the way many others in the industry advertise mobile phone handsets. Telstra has now made some changes to its advertising to ensure the information is clearer for the customer.

Read more from the SMH.

Opinion: A slap on the wrist

The fine handed to Telstra for misleading advertising is nothing more than a slap on the wrist for the telecommunications giant. The company recorded a profit of $4.3 billion last financial year, which equates to a little over $122,000 every fifteen minutes, so a fine of $102,000 is nothing more than a warning for the whole industry to improve its advertising standards.

However, he infringement notice issued by the ACCC is a step in the right direction for the customer. Over the past decade a large number of Australian companies have been hiding details in the fine print, and this has to change. There is still more that can be done to help the customer, such as increasing the minimum accepted font size, both onscreen and in magazines, and the onscreen duration of all fine-print in television advertising.

While the fine handed down to Telstra won’t hurt them financially, let’s hope that it is a wake-up call to the whole industry Australia-wide to improve the way it advertises.

What do you think? Should Telstra have been slogged a much higher fine? Are you constantly misled by advertising due to hidden costs in the fine print? Do you struggle to read the fine print? 

Written by Drew

Starting out as a week of work experience in 2005 while studying his Bachelor of Business at Swinburne University, Drew has never left his post and has been with the company ever since, working on the websites digital needs. Drew has a passion for all things technology which is only rivalled for his love of all things sport (watching, not playing).