Telkom has appealed the decision by the Advertising Standards Authority (ASA) that the telco's advertising of a "completely unlimited" cellphone contract is misleading.
Earlier this year, the ASA received a complaint from consumer, Clayton Faulkner, against advertising on the Telkom Web site that offers "SA's best cellphone contract". The offer is for unlimited data, unlimited SMSes on all national networks, unlimited voice calls to South African cellular and landline networks, and free WiFi in over 6 000 Telkom WiFi hotspots around the country.
However, Faulkner complained the data offer is not really unlimited.
"The complainant submitted that the advertising was misleading as a subscriber only receives 15GB of data per month before being throttled to an unusable speed of 128kbps. This negates the word 'unlimited' used in the advertising," according to the ASA ruling.
"The company is opposed to the ruling and has opted its rights to appeal the ruling," says Telkom's executive for external communication, Gugulethu Maqetuka.
"Whenever a ruling is made against an advertiser, the advertiser cannot then use the advert in the form in which it was advertised until the ruling is overturned. The advertiser can continue advertising the product but must amend the advert in compliance with the ruling until the ruling is overturned," he adds.
Meanwhile, Faulkner says he will challenge Telkom's appeal at the ASA. "I won the first round against Telkom; they are now appealing and I have to now challenge their challenge. I am going to challenge them on how they derive at fair usage on their unlimited plan because at my estimation, 100G per month is reasonable.
"How did Telkom derive at the figure that 15G is considered fair usage? A mobile phone is now the computer: we use it to play games, watch movies, listen to the radio and these mobile devices connect to the TV and entertainment systems. We communicate via FaceTime or Skype to friends and family.
"To my estimation, a person who can afford an uncapped solution is in the top 1% or 2% of the population and it is this target audience that uses all these services," he notes.
Faulkner points out that an average movie is 1G "so if I watch one movie a day, we are at 30G per month. If I Skype a friend or family for 20 minutes a day, an average Skype call is 3MB per minute so it is about 2G per month. If I use YouTube for studies, it works out about 1G per hour. Let's say I study about two hours a day; that is 60G. This now excludes all the software that is required to be online and updated."
After review, the ASA said it found the advertising makes no mention of line speed, "meaning that the usability (or lack thereof) of the reduced speed of 128kbps does not factor into the consideration at this time".
The ASA found the advertising conveyed the apparent lack of any limitations more than once, and "there can be no dispute that this communicates to the hypothetical reasonable person that there are no limitations to this offering".
The ASA, therefore, ruled the advertising for the "completely unlimited" deal is communicated in a misleading manner, and in contravention of clause 4.2.1 of Section II of the Code of Advertising Practice.
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