Tech giant Apple has proposed refunding customers confused over the use of the word “4G” in its advertising for the new iPad, in a court battle this morning initiated by the Australian Competition and Consumer Commission.
The action comes after developers and tech experts hinted there would be trouble brewing with authorities over the advertising, which suggests the iPad is 4G capable, despite not being able to connect to an Australian 4G network.
This morning the tech giant’s counsel, Paul Anastassiou, said the company proposes a refund or return for shoppers, “if they claim to have been in any way misled in relation to the reference to 4G”, according to The Australian.
“At no point in any promotional material for which Apple was responsible has Apple said at any time that the new Apple device is compatible (with Telstra).”
Apple has also reportedly said it would send clarifying emails to customers, but has not agreed to put stickers on its packaging that would clarify the situation further.
The legal battle was initiated yesterday, when the ACCC said in a statement it would make an application to the Federal Court for orders against Apple for alleged contraventions of the Australian Consumer law.
“The ACCC alleges that Apple’s recent promotion of the new ‘iPad with Wi-Fi + 4G’ is misleading because it represents to Australian consumers that the product ‘iPad with WiFi + 4G’ can, with a SIM card, connect to a 4G mobile data network in Australia, when this is not the case.”
Apple was contacted by SmartCompany this morning, but a reply was not available prior to publication.
The ACCC said in its statement that it’s seeking an interim judgement to ensure “consumers are made aware of the correct technical capabilities of this device.”
“Additionally, the ACCC is seeking final orders including injunctions, pecuniary penalties, corrective advertising and refunds to consumers affected.”
This could mean Apple is hit with fines in the millions of dollars.
The competition watchdog also said consumers considering buying an iPad need to be up to date with proper information so they aren’t disappointed.
The problem lies inside the iPad itself. The new device is designed to connect to 4G networks operating on two different frequencies – the 700Mhz and 2100Mhz frequencies.
However, Telstra’s 4G network – the only operational 4G network in the country – works on the 1800Mhz frequency and the new iPad doesn’t recognise networks on that signal.
Australian networks use the 700Mhz frequency for analogue television signals, which won’t be out of use for a few years.
The attempt to slam Apple with an injunction order comes just months after the tech giant became embroiled in a legal battle with Samsung over that company’s Galaxy Tab. Apple alleged the device infringed several patents, and successfully delayed the Korean tech giant from selling the tablet for several weeks.
The legal battle influenced court decisions made in other nations over the same dispute.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
