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Telecommunications companies have been warned about ensuring that their advertising contains no ambiguities, with the competition watchdog saying they may otherwise face court action.

The Australian Competition and Consumer Commission said in a statement on Monday that wrong claims in ads would attract higher penalties and executive who approved such advertising could face proceedings themselves.

The ACCC pointed to the fact that between March and June, the three big telcos — Telstra, Optus and Vodafone — had advertised mobile data plans with headlines claiming they offered "unlimited" data.

However all the services had speed caps which came into play after particular types of usage or else after a certain data threshold was reached.

It said: "Optus’ 'unlimited’ plan imposed a 1.5Mbps speed restriction on tethering, streaming and downloads. Heavy data users could also be deprioritised during congestion;

"Vodafone’s ‘unlimited’ plan provided an initial data allowance at usual speeds, after which all usage was speed capped at 1.5Mbps; and

"Telstra’s ‘unlimited’ plans provided 40GB at usual speeds, after which all usage was slowed to 1.5Mbps and slowed further during busy periods."

All these claims were stopped after the ACCC took the companies to the Federal Court.

“Telecommunications companies should be wary of using absolute claims like ‘unlimited’ where that does not give a true picture to consumers of what is being offered,” ACCC chair Rod Sims said.

“We have taken a range of actions against telecommunication companies for misleading consumers. It is about time they showed more respect for their customers and the Australian Consumer Law.

“With much higher penalties now available for breaches of consumer law, I hope they will take their obligations more seriously. From now on consumer law penalties will seriously affect their bottom line, and we will not hesitate to seek the highest possible penalties.”

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Sam Varghese

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Sam Varghese has been writing for iTWire since 2006, a year after the sitecame into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

 

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