Updated: Judge orders Optus to correct misleading ads

Optus's “digital cousin of the baker’s dozen” found to be misleading in its use of data quotas and speed throttling

Optus has been ordered to issue corrective advertising relating to its ‘Think Bigger’ and ‘Supersonic’ plans for hybrid-fibre coaxial (HFC) plans, and will pay civil penalties for misleading advertising of the plans.

Commenting on the his decision to find the Optus ads to be misleading, Federal Court judge, Justice Perram, said the ads failed to properly inform potential customers that their broadband speeds would be throttled to 64 kilobits per second (Kbps) -- or “sub-broadband” -- once they reached their monthly data quota.

Justice Perram also found the telco failed to properly cease potentially misleading advertising of the plans, despite later adding a speed throttling disclaimer to the ads.

“I am far from convinced either that Optus’ recent cessation is anything other than opportunistic or that it signals some newly obtained underlying comprehension of the need to avoid such tricky behaviour in the future,” the judge’s finding reads.

As a result, Justice Perram ordered an injunction be placed upon the telco for advertising in a similar manner for three years. While the ACCC argued five years is necessary, Justice Perram ultimately decided in favour of Optus which claimed potential “changes in environment” mean the injunction should be shorter.

The legal proceedings — first brought against Optus in September — question a total of 11 ads across online, print, television and billboards which advertised the cable plans were four times faster than “standard broadband”. The network is capable of downstream speeds of up to 100 megabits per second (Mbps) downstream, but this is capped to 64Kbps once the user reaches their monthly download quota.

Labelling the Optus plans the “digital cousin of the baker’s dozen,” Justice Perram found customers could potentially be misled by the data quotas accompanying the plans.

However, Optus was granted right to use speed throttling on customers exceeding their quotas, with Justice Perram finding the consumer would not have “any illusion about the tiresome consequences of exceeding the usage limits”.

Corrective advertising will be ordered from the telco to rectify any potential misleading over the plans in question. Lead barrister for the Australian Competition and Consumer Commission (ACCC), Neil Williams SC, called for Optus to increase the font size of its speed limit disclaimer “clearly and prominently” to be the same as the peak/off-peak information.

Details of the corrective advertising and any civil penalties are to be determined by Justice Perram on Friday.

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