ACCC forces Optus to fall into line on mobile phone warranties, slams Dodo over broadband ads

The ACCC’s seemingly never-ending crackdown on the telco industry has continued, with the corporate watchdog announcing that it has forced Optus to fall into line with other phone companies by offering a 24-month warranty for all post-paid phones, including the Apple iPhone.

The announcement comes just a day after junior telco Dodo paid four infringement notices worth $26,400 after the ACCC claimed the company had made false or misleading claims about the services in its $39.90 broadband plan.

ACCC’s chair Graeme Samuel has described the Optus warranty agreement as a big win for consumers. He says the watchdog was concerned that Optus customers with faulty phones were being told that they could only claim a refund or other remedy under the manufacturer’s warranty – which usually expire well before the 24 months that the standard post-paid contract runs for.

But Optus has now agreed that it will provide a 24-month express repair warranty for all phones supplied on 24-month contracts, including the popular iPhone.

Samuel says the agreement should also send a message far beyond the telco sector.

“Retailers take note – you cannot wipe your hands clean of a faulty product just because the manufacturer’s warranty period has ended, particularly when your product is supplied in conjunction with a lock-in contract that is longer than the manufacturer’s warranty period,” Samuel said in a statement.

“The law gives consumers a basic, guaranteed level of protection for goods and services they acquire and such rights and guarantees cannot be excluded or limited by suppliers. In fact, any representation by a supplier that seeks to exclude or limit these rights and guarantees available to consumers is illegal.”

Dodo’s case involved a far more common problem in the telco sector – alleged misrepresentations about the actual price of broadband plans.

Between August and October 2010, the company ran a promotion stating customers could purchase the company’s broadband plan for $39.90 per month, when in fact the plan was only available with a connected home telephone plan, which costs at least $29.90 a month.

“Consumers often compare the monthly price of internet and telecommunication services when considering the best deal. To prominently advertise the price of only one component and bury the total bundled price in the fine print is misleading,” ACCC deputy chair Michael Schaper said.

“In such circumstances consumers might be misled into thinking the cost of the services are cheaper than they actually are.”