iiNet hit with $204k penalty over broadband ads

iiNet has paid out $204,000 in penalties over advertisements for its 250GB naked broadband plan after being issued with two infringement notices by the consumer watchdog.

One of the iiNet ads under fire.

The Australian Competition and Consumer Commission today said the ads had failed to prominently display the minimum price of the service, giving the ACCC "reasonable grounds" to believe iiNet had contravened consumer law.

The ads in question - which were displayed in November last year on a tram and billboard in Melbourne - offered a $69.95 monthly deal for the 250GB naked broadband plan.

While the ads did include the total minimum price in fine print ($1758.75 over two years,not including a $79.95 connection fee), the ACCC said, it was not displayed prominently enough to adhere to consumer law.

“Prominence means that the total minimum price can be easily seen and strikes the attention of the consumer," ACCC chairman Rod Sims said in a statement.

"In assessing whether the total minimum price is prominent, it is important to consider the context in which the advertisement appears - for example if the advertisement is on a moving vehicle, where consumers may only be able to see the advertisement momentarily.”

iiNet was therefore issued two separate infringement notices, each totalling $102,000. The ACCC stressed that iiNet's payment of the penalty was not an admission that the company had contravened consumer protection law.

An iiNet spokesperson said the ISP had been surprised by the infringement notices and did not agree with the ACCC's assessment of the ads.

"iiNet has paid the fine despite being disappointed that these matters can’t be worked through between the ACCC and the industry without formal enforcement measures being taken," the spokesperson said.

Fellow telecommunications provider Telstra was last year similarly hit with a $102,000 penalty after the ACCC took issue with its advertisement for the iPhone 6.

The year prior, the watchdog pursued TPG in the High Court over misleading advertisements and was successful in reinstating a $2 million penalty over advertised pricing of TPG’s Unlimited ADSL2+ broadband plan.