blog Wow, Optus is really giving its rivals a free kick at the moment. Yesterday the news arrived that the telco is suing Vodafone over the company’s mobile advertisements, which use the term “infinite”. Quoth ZDNet:
“Optus told ZDNet Australia in a statement that it has concerns that the advertising is misleading because it “does not adequately inform consumers of the various qualifications” of the “infinite” plans.”
Those of you with a memory which stretches back beyond last weekend might remember that just several months ago it was Optus being sued for using the word “unlimited”. The ACCC was concerned about *cough* the various qualifications which Optus had put on its “unlimited” plans.
At the time, Optus argued that customers weren’t stupid and researched their broadband plans before purchasing — and therefore that the lack of complete disclosure didn’t matter. But wait, isn’t that what Vodafone is arguing this week? Yup; the company claimed customers were “reasonably educated” and could work out things for themselves.
Now we’ve been fairly harsh on Optus recently. But this is a square cut case of the pot calling the kettle black. Arguing one side in a court defence and then turning around scant weeks later to argue the other side against a competitor?
That shows a lack of integrity. Man up, Optus. You’re acting like a little girl.
Image credit: Mendhak, Creative Commons
If only Optus spent as much time and effort on their network performance and customer service!
With the recent hits they have taken in regards to the ACCC cases mentioned in this article, Optus are getting onto the front foot to ensure that their current position is protected by making sure their main competitors – (Telstra and VHA) – don’t get away with things they couldn’t themselves.
And that’s fair enough too – but public finger pointing like this is a bit of a “I’m dobbing on you” exercise, and their goal would be far better served by raising the matter with the ACCC directly, rather than starting what might easily turn into a publicity slanging match.
I don’t blame them for protecting their position – nobody would – but I think they could do it a little more appropriately.
Ultimately, Optus are at something of a crossroads in my opinion.
While they have good mobile (voice and internet) numbers, the upcoming structural changes to the industry leave them in a situation where many of their existing assets – (particularly their HFC network) – are quite possibly going to take a dive in value.
Much like Telstra, Optus would love to be free of their expensive to maintain HFC network, and an impending NBN makes it less and less valuable all the time. It is probably already too late to sell it as-is, and I get the feeling it may turn into a write-off situation by the end of the NBN rollout.
Interesting times for Optus ahead.
True; I guess that’s what I’m getting at here. There is no doubt that this is relatively normal corporate legal action. However, for Optus to come out so aggressively against VHA just a short time after being pinned for exactly the same behaviour (and with the same excuse) rubs a bit raw. There were other ways to do this.
And yes; I agree the company is in a bit of an interesting situation at the moment; that’s something I’d like to explore a bit further in some articles, maybe early next year. I haven’t seen a lot of leadership from “Australia’s challenger telco” in recent times, and it bothers me.
I agree with the first part of Micheal’s observation above. Optus is simply “playing the game”. The ‘Gruen transfer’ had a good segment on this a while back, where they discussed how aggressively the telcos monitor each other on this kind of thing.
As noted though, the choice to go for direct legal action rather than via the ACCC is an interesting one.
Disclaimer: I work in the telco sector but these are my personal views.
You can still ‘play the game’ in a way that displays integrity; I don’t Optus is precisely doing that here.
Well hang on a second,
I thought from memory that Optus was done by the ACCC for its use of “unlimited” i.e. it lost.
The reason why s52 of the TPA- (the misleading and deceptive conduct prohibition) works so well is because competitors who have a direct commercial interest in the outcome of the litigation can bring action against suspect action. These same competitors will not bring vexatious litigation to court because they will have to pay costs. So s52 is a particularly efficient mechanism for large entetrprises to use against each others’ false, misleading or deceptive conduct.
Compare this to the consumer protection mechanisms in financial services for instance that rely on ASIC to take action- who typically jump in after everyone loses all their money.
The ACCC does not have the time or resources to go after every suspected s52 breach. Until the ACCC prioritises this particular case, Optus and other competitors will be losing out. While the ACCC can fine contravenors, it does not have an effective mechanism for compensating people who are disadantaged by breaches of s52. Where the breach is obvious, simple and the damage significant and immediate it makes sense for a competitor directly disadvantaged to sue directly.
Without Optus or any other interested competitor taking these kinds of action we would be left with a much higher degree of misleading and deceptive conduct in the market, because if one firm can get away with it, then others will follow making more and more tenuous claims.
And you can’t really knock Optus for complaining about a double standard- i.e. if the ACCC demands one thing of Optus then Optus is entitled to demand it of all its competitors including Vodafone.
I don’t think anyone is blaming Optus for raising the issue.
But going straight to the courts to sue VHA for this is pretty heavy handed. Anyone – individual or business – can ask the ACCC to investigate any situation like this. Using the courts should be absolutely the last resort when all amicable avenues have failed.
Yes, Optus did lose; I’m more making the point that coming out like this just a short time is pretty much like the pot calling the kettle black.
No disagreement there…I think we are just wording it from opposite directions :)
Can the writer inform me why the phrase ‘little girl’ is the chosen insult. In my experience little boys cry
a lot harder when crossed.
Because I’m male and in male society calling someone a little girl is an insult – an insult I am attempting to level at Optus :) We have had and will have more female writers on Delimiter, and they have their own insults they use.
(and yes, little boys do cry just as much!)
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