Court Battle Over Mobile-phone Ads
The Age
Thursday September 14, 1995
A newspaper that offered a ``free mobile phone for every reader" and a shop engaged in the promotion are the first organisations to have criminal proceedings launched against them for allegedly misleading readers.
The Trade Practices Commission filed the charges on Wednesday in the Federal Court in Sydney against Nationwide News, the publisher of The Daily Telegraph Mirror, and the retailers SmartCom Telecommunications.
The TPC alleges that Nationwide News breached the Trade Practices Act by making false and misleading representations about the price of the phones offered, the conditions that applied and the effect of those conditions. It also alleges that Nationwide News offered free items with the intention of not providing them as offered. SmartCom is alleged to have ``aided, abetted, counselled or procured" some of the alleged breaches.
The Telegraph Mirror's promotion began on a Thursday earlier this year with an advertisement offering a free phone for every reader and the instruction, ``Don't miss Monday's Telegraph Mirror".
A further ad in the paper the next day and in The Sunday Telegraph added the words ``conditions apply" and ``for readers" instead of ``for every reader", but did not mention the conditions.
By Monday, the TPC alleges, readers found the offer was limited to 5000 readers in Sydney. To get a ``free" mobile phone, readers would have to enter into a 15-month contract with SmartCom for access to the Vodafone network at a cost of more than $2000.
Newspapers carrying the earlier ads are said to have been sold in country areas where the ``free" offer would not have applied.
The TPC, under its chairman Professor Allan Fels, has spent more than a year cracking down on misleading mobile-phone ads. So far, it has taken action against or gained undertakings from the main phone providers, Telstra, Optus and Vodafone, to spell out in ads all conditions involved in phone purchases.
This is the first time the TPC has resorted to taking criminal action, which could carry hefty fines, instead of civil action that usually involves orders to comply and possible reparations.
© 1995 The Age
