19 Feb 2014

The battle of the facts – Optus loses court battle to Telstra over a TV advertisement

Optus ran an ad on TV advertisement at the beginning of this month, stating that “When it comes to the percentage of Australians the Optus mobile network reaches, there isn’t much difference between us and Telstra. In fact it’s less than 1%.” While technically true, this statement caused Telstra to send a letter to Optus demanding the ad be taken down, which Optus refused. Telstra then made a court claim to have the ad removed, stating that it mislead consumers. While the statement is technically correct (only 1% less of Australia’s population can receive Optus coverage compared to Telstra) it made it seem that Optus had a network of similar size. In fact, the Telstra network covers 2.3 million square kilometres or 28% of Australia’s land mass, while Optus’ network covers less than half of that. The court agreed with Telstra, in that customers were being misled and that the effect was detrimental to the brand. Telstra were granted an injunction in the Victorian Supreme Court, ordering Optus to take down the advertisement as of yesterday. While statements made in advertisements may be technically true, it doesn’t mean that a breach of the Australian Consumer law in the Competition and Consumer Act has not occurred. The Act ensures that companies are not only factual in their advertising, but also that it does not mislead the customer at the detriment to another brand.