Australia's Optus Loses Court Fight Over Advertising Claims
Published on: 19th Feb 2014
Note -- this news article is more than a year old.
An Australian court has ruled that Optus had misslead customers in an advertising campaign that compared its network coverage to that of its rival Telstra.
The key claim by Optus was that there was less an a 1% difference between their LTE network's coverage. However, Australia is a country with a vast rural expanse, and while indeed there was minimal difference between population coverage, there was significant difference in geographical coverage.
Optus claimed 98.5% coverage vs Teltra's 99.3% coverage. However, Telstra argued that its network covered 2.3 million square kilometers vs Optus' one million sq km.
Telstra took Optus to court over the issue, as it said that the style of the adverts, especially their use of a map of the country implied geographic coverage -- and the Victorian Supreme Court agreed.
It ruled that Optus' advert was likely to "mislead or deceive".
Telstra said in a statement: "Telstra welcomes today's ruling by the Supreme Court, it's a win for consumers. Optus has been caught out misleading Australians by implying their geographic network coverage is similar to Telstra's.
The court has not made any decision about damages that Optus might have to pay to Telstra, and those will be determined at a later date. However, the bad publicity for Optus will be damaging enough.
David Epstein, vice president of corporate and regulatory affairs at Optus, said in a statement: "While we're disappointed in the court's ruling, Optus remains committed to the strength of our network.
Optus had already pulled the adverts from its web site under a previous agreement with the court in an earlier hearing, but was still running them on television where it had already paid for the slots.