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Apple reaches A$2.25M settlement with Australian regulator over 4G iPad

post #1 of 102
Thread Starter 
Apple has agreed to pay an A$2.25 million penalty to an Australian consumer rights watchdog after being accused of falsely advertising its LTE-capable iPad in the country.

In addition to the A$2.25 million (US$2.23 million) penalty, Apple is also expected to pay A$300,000 toward the Australian Competition and Consumer Commission's legal fees, The Australian reports (via The Next Web). The ACCC filed its complaint against Apple in March shortly after the release of the new iPad.

Colin Golvan, who represents the ACCC, described the penalty as "substantial" and hoped it would serve as a deterrent to the computer industry.

Though Apple has agreed to the settlement amount, a judge still needs to sign off on the agreement. According to the report, Judge Mordy Bromberg expressed concerns that he didn't have enough information to ascertain whether the penalty is "appropriate."

"At the moment on the agreed facts you put before me, I have no idea whether a consumer who bought the iPad, thinking it could connect to 4G but then realising that it couldn't, has been impacted in any way," Bromberg said."

LTE



The commission took issue with Apple advertising the device as 4G even though it was not compatible with LTE networks in Australia. Apple initially defended its decision, claiming that iPad-compatible 3G networks operated by Telstra, Optus and Vodafone in the country could be classified as 4G. The company also revised its store to better inform customers about the iPad's LTE functionality and also offered refunds to customers who were unhappy with their purchase.

Last month, Apple acquiesced to complaints and began rebranding its "iPad Wi-Fi + 4G" as the "iPad W-Fi + Cellular."

Cellular
post #2 of 102

This settlement pisses me off. Apple offered anyone who wanted it a full refund, so how can anyone claim "damages." This is just the government extorting money from a wealthy company to fill their pockets while looking like they are "watching out for consumers." Granted, I can't blame apple for settling to avoid the hassle. 

post #3 of 102

Yeah...Here's some pocket change, kid. Now move on, yer botherin' me, yer botherin' me.

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post #4 of 102

I am so embarrassed right now to be Australian. Let's hope His Honour reviews this and finds that no-one was actually harmed etc by this naming issue, and dismisses the case. 

 

The ACCC was supposed to be tougher this year, yet it picks on Apple instead of the banks, telcos and health insurance industries. Unbelievable.

post #5 of 102
"This never would have happened under Steve Jobs watch."

Quote:
Originally Posted by Tenfingers View Post

This settlement pisses me off. Apple offered anyone who wanted it a full refund, so how can anyone claim "damages." This is just the government extorting money from a wealthy company to fill their pockets while looking like they are "watching out for consumers." Granted, I can't blame apple for settling to avoid the hassle. 

This goes to show you that you need to think about the idiot more than the average person when marketing a product.

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post #6 of 102

A token settlement and possibly face saving outcome (as illustrated by the judge's inability to determine a proper penalty).  No one losing sleep in Cupertino tonight over this!

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post #7 of 102
Quote:
Originally Posted by Tibor View Post

I am so embarrassed right now to be Australian. Let's hope His Honour reviews this and finds that no-one was actually harmed etc by this naming issue, and dismisses the case. 

 

The ACCC was supposed to be tougher this year, yet it picks on Apple instead of the banks, telcos and health insurance industries. Unbelievable.

 

my thoughts exactly. The amount of stuff we get ripped off on in Australia is amazing. Pay one of the highest tax rates in the world and everything costs more than anywhere else yet the ACCC do nothing about anything that actually matters

post #8 of 102
Quote:
Originally Posted by IQatEdo View Post

A token settlement and possibly face saving outcome (as illustrated by the judge's inability to determine a proper penalty).  No one losing sleep in Cupertino tonight over this!

If my math is correct the settlement comes out to 1.36 cents USD per share. I think it's silly and would have fought this for the principle of the matter but, as you say, no one is losing sleep in Cupertino over this.

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post #9 of 102

A money grab by government bureaucrats.  And they wonder why goods imported to Australia costs 50% more...

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post #10 of 102
Because there were like 5 Australians who bought the iPad thinking 4G connectivity works and felt deceived cost Apple $2.25M..
post #11 of 102
ThisX3. Banks, mining companies, private schools, please, have our cake and eat it and crap it out in our faces too. Apple were arrogant in the oversight but please, ACCC just bought some fake fangs.
post #12 of 102

http://imgur.com/9cpxE

 

That is all... lol
 

post #13 of 102
Quote:
Originally Posted by SolipsismX View Post

"This never would have happened under Steve Jobs watch."
This goes to show you that you need to think about the idiot more than the average person when marketing a product.

hair-dryer-warning.jpg

post #14 of 102
Listen to the judge!
post #15 of 102
Quote:
Originally Posted by Tenfingers View Post

This settlement pisses me off. Apple offered anyone who wanted it a full refund, so how can anyone claim "damages." This is just the government extorting money from a wealthy company to fill their pockets while looking like they are "watching out for consumers." Granted, I can't blame apple for settling to avoid the hassle. 

No, it's to stop companies misleading people.

post #16 of 102
Quote:
Originally Posted by John.B View Post

A money grab by government bureaucrats.  And they wonder why goods imported to Australia costs 50% more...

What does that have to do with costs of things?? This is about misleading advertising...

post #17 of 102
Quote:
Originally Posted by GadgetCanada View Post

I'm standing in a strangers house right now with my wifi iPad. This stranger has wifi service in his house but refuses to give me his password thus rendering the wifi functionality on my iPad useless. I'm gonna sue Apple for advertising wifi functionality on the iPad.

Yeah real close.....not.

post #18 of 102
Quote:
Originally Posted by GadgetCanada View Post

New Apple ad "The new iPad with 4G. Please note that 4G service may not work where there is no 4G service. For example, Antarctica, Marianas Trench, the Moon, and Australia."

More like the rest of the world except the US and Canada...maybe you should get a clue.

post #19 of 102

Hey, I'm an Apple fan but this was their mistake. Truth in advertising: it says 4G LTE all over the box and in the adverts but it can't deliver (yet). Wouldn't have been a problem if it had been compatible with Telstra 4G but it isn't.  

 

Just as long as as the ACCC is consistent in the application of these standards to other companies, I can't see the problem. It's not going to hurt Apple that much

post #20 of 102

False advertising claim gets fined.  .

 

People blame Australia, for upholding their regulations, 

 

Even better, money grab?  2.25million?  Australia?  whats their GDP? a trillion?

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post #21 of 102

$2.25 million? This is peanuts for Apple.

 

If Apple makes a $225 profit on each iPad  4G  Cellular sold, it only needs to sell 10 000  4G  Cellular units in Australia to make up for the marketing SNAFU. Considering that Australia's population is 0.326% of the world, and assuming a similar adoption rate of the iPad in Australia as worldwide in general, Apple probably sells close to 50 000 units in Australia in 3 months. Given that approximately 10% of the iPads sold are 4G (at least as estimated about the US), it would only take half a year for Apple to recover the penalty. If Australian buyers refrain from buying the  4G  Cellular model for any reason (lack of compatibility to local 4G networks springs to mind), then it could take Apple as long as one year to recover the costs, or about the time before the release of the next new iPad.

 

It would appear to me that Apple could have passed on selling the incompatible iPad 4G in Australia altogether.


Edited by DrDoppio - 6/7/12 at 11:47pm
post #22 of 102

Australia doesn't use the term "cellular" or "cellphone", using these terms would draw no more than a blank stare, in much the same way as "4G".

 

One part America can learn from, notice how the loser had to pay costs, that stops a lot of frivolous lawsuits here.

 

Is this justice?

 

Only for the rich.

 

Maybe now Australians should launch a class action against the ACCC for causing a delay in the supply of new (US & Canada) 4G compatible iPads.

 

Day after day people keep asking for them, day after day we turn them away due to a lack of stock or switch them to iPad 2's.

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post #23 of 102
Quote:
Originally Posted by hill60 View Post

Australia doesn't use the term "cellular" or "cellphone", using these terms would draw no more than a blank stare, in much the same way as "4G".

 

One part America can learn from, notice how the loser had to pay costs, that stops a lot of frivolous lawsuits here.

 

Is this justice?

 

Only for the rich.

 

Maybe now Australians should launch a class action against the ACCC for causing a delay in the supply of new (US & Canada) 4G compatible iPads.

 

Day after day people keep asking for them, day after day we turn them away due to a lack of stock or switch them to iPad 2's.

What evidence do you have that this caused a delay in stock of the new iPad?

post #24 of 102

I think it's fair.

It's only truly "4G" in two countries in the whole world, and shouldn't be marketed as such in other countries.

Sorry Apple. Until it's multiband, it's not "4G" in the rest of the world.

post #25 of 102
Quote:

Originally Posted by GadgetCanada
 

New Apple ad "The new iPad with 4G. Please note that 4G service may not work where there is no 4G service. For example, Antarctica, Marianas Trench, the Moon, and Australia."

 

We have 4G actually. Just not the frequency Apple chose.

post #26 of 102
Quote:
Originally Posted by yvo84 View Post

 

We have 4G actually. Just not the frequency Apple chose.

 

We have 4G on a frequency no one in the rest of the world chose. Not sure how true it is but Ive read it cause we didn't want to lose the awesomeness of analogue tv

post #27 of 102
Originally Posted by GadgetCanada 

New Apple ad "The new iPad with 4G. Please note that 4G service may not work where there is no 4G service. For example, Antarctica, Marianas Trench, the Moon, and Australia."


The new iPad with 4G only for North America. It fails everywhere else
post #28 of 102
Quote:
Originally Posted by geoadm View Post

 

We have 4G on a frequency no one in the rest of the world chose. Not sure how true it is but Ive read it cause we didn't want to lose the awesomeness of analogue tv

I think you should read some more...

post #29 of 102
Whatever the reactions from the Appleoids, bottomline: Apple was wrong and had to pay up
post #30 of 102
Quote:
Originally Posted by Tenfingers View Post

This settlement pisses me off. Apple offered anyone who wanted it a full refund, so how can anyone claim "damages." This is just the government extorting money from a wealthy company to fill their pockets while looking like they are "watching out for consumers." Granted, I can't blame apple for settling to avoid the hassle. 

There's no damages to prove. It's about misleading advertising. A loss doesn't have to result. The act itself is sufficient.

post #31 of 102

I wonder if Apple will extend the refund offer to other countries, such as the UK, where the 4G moniker fell foul of the advertising authorities and had to be changed.

 

At the very least, Apple should make the offer as an act of good faith and customer service.

post #32 of 102

Seems a bit steep for an advertising breach. Maybe $100k or so would be more reasonable, specially given the term they used was technically correct.

post #33 of 102
Quote:
Originally Posted by fredaroony View Post

What evidence do you have that this caused a delay in stock of the new iPad?

The "4G" on the box, that us Australians are too retarded to understand.

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post #34 of 102

in unrelated news, Apple has slightly increased the price of all products sold in Australia.

post #35 of 102
Quote:
Originally Posted by hill60 View Post

The "4G" on the box, that us Australians are too retarded to understand.

Ahh so you don't actually have any evidence. Didn't think so...

 

I'm quite glad you aren't in charge of protecting consumer rights in Australia.


Edited by fredaroony - 6/8/12 at 4:22am
post #36 of 102

Don't be too surprised if this doesn't happen. Apple were wrong, will now pay and should move on.

post #37 of 102
Quote:
Originally Posted by ascii View Post

Seems a bit steep for an advertising breach. Maybe $100k or so would be more reasonable, specially given the term they used was technically correct.

You make it sound like it was nothing, they openly broke the law and only fixed it when they were forced to.

post #38 of 102
Quote:
Originally Posted by fredaroony View Post

Ahh so you don't actually have any evidence. Didn't think so...

 

I'm quite glad you aren't in charge of protecting consumer rights in Australia.

 

Evidence? I don't think you should be asking for evidence. All you do is make smart arse replies giving no evidence at all. 

And its hardly consumer rights, its more like protecting the stupid. It was written on the Apple site the 4G is not compatible with current Australian networks. All you had to do was read the information before entering credit card details.

post #39 of 102

If Apple was right in this case, they would have won, the end :) thems the breaks
 

post #40 of 102
Quote:
Originally Posted by OllieWallieWhiskers View Post

in unrelated news, Apple has slightly increased the price of all products sold in Australia.

 

That's not news.

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