Vodafone alleges rival Telstra has ‘misled’ customers about mobile coverage

Vodafone has known as for the ACCC to analyze Telstra for “misleading customers” over the extent of its cell community protection, which it says has resulted in an unfair market benefit.

In a uncommon public spat between main telcos, Vodafone alleges Telstra has engaged in deceptive or misleading conduct for greater than 15 years, by overstating the attain of its cell community by as a lot as 40 per cent.

The TPG Telecom-owned telco wrote to the Australian Competitors and Shopper Fee (ACCC) final week and urged the watchdog to launch an investigation into Telstra’s conduct.

Vodafone has accused Telstra and its different cell model, Increase, of utilizing “inflated” protection claims to make unfair comparisons in opposition to different cell operators’ community protection.

Telstra’s marketed declare that it has a “mobile network coverage area of 3 million square kilometres covering 99.7 per cent of the Australian population” had, till Could this yr, didn’t state that the determine was based mostly on customers utilizing an exterior antenna and booster.

Antennas and different particular gear to spice up protection can value 1000’s of {dollars} and will not be typically owned by individuals outdoors of distant places.

Compared, Telstra’s cell protection with out utilizing an exterior antenna is considerably much less, round 1.9 million sq. kilometres, in response to evaluation of figures the telco has supplied to the ACCC.

“That’s nearly 1 million square kilometres, which is the difference between what a customer’s being told they can get when they’re just using their mobile phone when they’re out and about, and what they could actually get,” mentioned Kieren Cooney, group govt shopper, knowledge and analytics at Vodafone’s mum or dad firm, TPG Telecom.

Vodafone has pointed to a number of examples of alleged false and deceptive claims about Telstra’s cell protection in promoting, gross sales and different materials, together with firm annual studies courting again to 2009.

Web site data present Telstra up to date its web site this month to incorporate the clarification about antennas.

On April 16, Telstra’s web site said it had the “Largest and most reliable network: we’ve built Australia’s largest and most reliable mobile network, covering 99.7 per cent of the Australian population”, with a protection space of “3 million square kilometres” that was “1 million square kilometres more than any other network.”

By Could 12, Telstra’s web site was modified to state the telco had: “[The] Largest and most reliable network: Covering 99.7 per cent of the Australian population when using an external antenna,” with a cell community “1 million square kilometres more than any other mobile network”. The web site now additionally features a hyperlink to Telstra’s protection maps.

“By making these changes, Telstra has effectively accepted the earlier claims were misleading, however, Vodafone does not believe the changes have addressed the misleading conduct,” TPG’s Mr Cooney mentioned.

“Telstra’s conduct could have misled consumers into believing they can get coverage in places that require special equipment.”

Vodafone mentioned protection claims made on the identical foundation have been republished by different suppliers utilizing the Telstra cell community.

In distinction, Telstra rivals Vodafone and Optus base their community protection claims on “outdoor coverage”, a measure of the sign power {that a} buyer would obtain utilizing a cell phone outdoors, with no particular antenna or powered repeater.

In response to questions from the ABC, Telstra admitted it up to date its web site after being contacted by Vodafone however mentioned any suggestion it had misled the general public in regards to the measurement of our community was “completely untrue.”

“Irrespective of the way you take a look at it, Telstra’s cell community covers extra of Australia than every other.

“On any measure, Telstra’s network is at least 1 million square kilometres larger than Vodafone’s — that’s an area more than 14 times the size of Tasmania,” the spokesperson for Telstra mentioned.

Mr Cooney mentioned by overstating the protection obtainable to most Australians, Telstra and its resellers could have retained clients that might have in any other case signed as much as rival telcos.

“It appears Telstra has tricked Australians into paying top dollar for coverage they simply can’t get on a regular mobile phone.”

Vodafone can also be contemplating authorized motion to require Telstra to stop the conduct and pay compensation, nonetheless, doing so could be expensive and will expose the smaller telco to counter allegations that it might be pressured to defend.

‘Telstra has kind’

The height advocacy group for telco customers, the Australian Communications Shopper Motion Community (ACCAN), mentioned the allegations in opposition to Telstra have been “very serious” and, together with the Nationwide Farmers Federation (NFF), has backed Vodafone’s requires the ACCC to intervene.

“If it proves to be true, it is a serious allegation that does indicate that Telstra are actually restricting competition,” ACCAN CEO Carol Bennett mentioned.

“That they are looking at increasing their own market share at the expense of other companies in the market, and in turn, for consumers, that does mean an increase in prices.

Ms Bennett mentioned deceptive and misleading conduct had no place in any market, not to mention a marketplace for a vital service.

“We all know that Telstra does have some kind in misleading and deceptive conduct and that is a priority.”

In 2007, the federal court docket dominated Telstra had misled consumers about the coverage available on its Next G mobile network.

In February this yr, the federal court docket discovered that Telstra made false or misleading representations relating to the upload speed of residential broadband internet services supplied to nearly 9,000 of its Belong customers.

In August 2021, Telstra was fined $15 million for making false or misleading representations in their promotions of some 50Mbps and 100Mbps NBN plans.

“In Australia, now we have restricted competitors and that, in fact, drives up costs and when these types of practices happen, and it is the type of factor that actually does impression customers and customers deserve higher,” Ms Bennett mentioned.

Market dominance

Australia’s telco market is dominated by three main cell community operators — Telstra, Optus and TPG Telecom — together with via sub-brands, with a collective market share of 88 per cent, in response to the ACCC’s latest communications market report.

Telstra is the biggest player with a 42 per cent share of the market, followed by Optus at 28 per cent and TPG Telecom at 17 per cent. The remaining 12 per cent market share belongs to mobile virtual network operators, according to the ACCC.

Telstra’s spokesperson pointed to the company’s online coverage maps, including where customers can “maximise protection”.

“Utilizing protection maps, individuals can see the numerous cities, highways and locations the place we have invested to offer protection and Vodafone hasn’t. We’re all for transparency and business consistency in how we report protection and would gladly put our maps up, side-by-side, in order that Australians can see the distinction.”

Indeed, Telstra is the only telco available in many parts of remote and regional Australia, including where NFF telco spokesperson Peter Thompson lives.

“Telstra is the one choice right here, and in a variety of locations,” Mr Thompson said, whose grazing and grain farm of more than 7,000 hectares is located about 80 kilometres from the Queensland town of Roma.

“A lot of the different suppliers have solely put towers within the extremely populated areas.

“So, in our case, Roma is the main town, where you can get Optus and Vodafone, or whoever, but once you get beyond the town limits, it’s Telstra.”

Mr Thompson mentioned about 15 to twenty per cent of his property had little or no or unreliable protection.

He mentioned Telstra’s on-line protection maps have been unreliable.

“The maximise coverage version is false,” Mr Thompson mentioned.

“The standard map shows pretty well signal coverage if you have boosters and antennas, but the issue is the fact that just because you have signal, it doesn’t mean you have signal that is usable.”

Mr Thompson mentioned Telstra’s cell community protection maps had turn out to be much more unbelievable because the shutdown of 3G in October, as a result of the changeover to 4G and 5G had resulted in poorer reliability in some areas.

“Frustrating is a pretty polite word for it, I’ve heard a lot of other people use much stronger words than that.”

Like many farmers, Mr Thompson nonetheless depends on UHF radio units and makes use of satellite tv for pc web.

“I wouldn’t say that Telstra have been lying to us, it’s just they haven’t been telling the whole truth, particularly when it comes to this mapping of signal.

Requires unbiased cell community protection map

In a press release, the ACCC confirmed it was contemplating Vodafone’s allegations in opposition to Telstra, however at this stage, a spokesperson mentioned it was unable to offer additional remark.

The regulator added that, final yr, it was pressured to desert its personal evaluation of cell community protection claims as a result of it couldn’t entry the underlying methodologies utilized by the telcos to supply their protection maps.

“Mobile operators do not have a standardised or consistent approach to the coverage maps they publish via their websites and in advertising,” the spokesperson mentioned.

“We continue to urge mobile operators to provide comparable coverage maps, which would enable consumers to compare mobile networks on a like-for-like basis.

“There isn’t any authorized requirement for cell community operators to offer this, however the ACCC has been advocating for extra transparency for customers for a while.”

There is work underway by the federal government, which has employed private consultancy firm Accenture, to map mobile coverage outside of the cities.

However, ACCAN and the NFF have some reservations about the veracity and independence of the mobile network coverage resource that the federal government has promised to produce based on the collected data.

“[We need] A protection map software that is unbiased for customers, that allows them to determine whether or not or not they are going to get protection within the space that they are in, or if there is likely to be some difficulties gaining access to that protection,” ACCAN’s Ms Bennett said.

“For the time being, telecommunications firms put protection maps on their very own web sites, they usually state that these are the degrees of protection that buyers can anticipate.

The federal authorities has additionally promised to increase common out of doors cell community entry by 2027 through the use of low-orbit satellites, which might be operated by telcos in partnership with satellite tv for pc suppliers.

The NFF’s Peter Thompson mentioned ground-based cell infrastructure would proceed to be wanted so individuals outdoors of the cities might be assured they’d not discover themselves in a cell black spot.

“There are times that you can feel somewhat like a second-class citizen,” he mentioned.

“At the end of the day, all we’re after is reliable, affordable communications.”