Australia’s consumer watchdog has begun proceedings against 28 parties, including some telecoms companies and their offshoots, alleging exclusivity, misleading and deceptive conduct.
Australia’s consumer watchdog has begun proceedings against 28 parties, including some telecoms companies and their offshoots, alleging exclusivity, misleading and deceptive conduct.
The Australian Competition and Consumer Commission alleges a number of telecommunications companies use an illegal “bundled services deals”
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| ACCC boss Graham Samuel |
business model for telecommunications services and equipment is common in the industry. “The bundled services arrangement is exclusive dealing, in breach of section 47(6) of the Trade Practices Act 1974,” the ACCC claims.
“Under the deals the company would enter into a contract with a small business to provide it with telecommunications services and call credits to cover.” It says that while the deals target small business, their total value runs into in the tens of millions of dollars
Companies named as respondents in the proceedings include Clear Communications, Axis Telecoms and WorldTel groups and National Telecoms. The matter has been listed for a directions hearing in the Federal Court, Sydney, on October 17.
And In a separate matter, the ACCC says it has successfully obtained orders from the Federal Court against TMG Asia Pacific for “false, misleading and deceptive conduct” in advertising premium-rate mobile subscription quiz services.
The ACCC alleged that in its television advertisements “Cash Cup”, “Mac Air”
and “Shell Game”, TMG failed to adequately disclose the costs and other terms associated with its “Text and Win” mobile premium services, and that this misled consumers.
The advertisements offered viewers a chance at winning a prize by texting in a response to TMG’s 194060 number, but the ACCC says they did not adequately inform consumers that by responding they would be signed up to an ongoing subscription service, charged at premium rates.
“Advertisements of this type seem to be designed to confuse consumers about what they are getting when they send in their text message,” says Graeme Samuel, ACCC chairman. “Ultimately many are misled into signing up for a costly ongoing subscription service.”
Resulting from a separate investigation, TMG and its parent company based in the Netherlands, The Mobile Generation I, also provided a court-enforceable undertaking to the ACCC regarding an Internet pop-up used to promote a Wixawin SMS quiz. The pop-up featured a Woolworths $500 Wishcard as a prize.
