UPDATE: ACCC says “STOP” to a mobile premium service’s misleading advertisements

On June 5, shortly after the registration of the premium mobile services industry code (discussed here), the Federal Court made declarations that AMV Holding had breached sections 52 and 53 of the TPA in their “BLiNG” advertisements for premium mobile services, published in the popular “Dolly”, “Girlfriend”, and “TV Hits” magazines (ACCC v AMV Holding Ltd [2009] FCA 605).

The case settled prior to final judgment, with the declarations made by the Court agreed by the parties as part of the settlement.  One can only speculate as to the role the new premium mobile services code played in reaching settlement.

The advertisements in questions were full page advertisements promoting different content services, but each included the heading (in prominent text): “Txt the itemcode to 19 44 00 BLiNG!”. Each service had its own code which the consumer could send to the “19” number to access the service. 

By way of example, the first BLiNG advertisement promoted content services broken up into categories such as:

  • “hunks” – comprising wallpaper images of men;
  • “Free 4 U” – including mobile video galleries and games, accompanied by text reading, “No subscriptions! No rip-offs 100% free access”; and
  • “play on mobile juke box” – comprising ringtones or full length tracks categeorised by artist’s name and song title.

At the foot of each advertisement was a disclaimer in very small font stating:

  • the items would be charged at $4 per week until the customer texted ‘STOP’ to the company’s number,
  • the ‘Java Games’ cost $8 per week,
  • the ‘Free 4 U’ content incurred normal operator SMS & browsing charges, and
  • the ‘Play On’ tones were not recorded by the original artist.

The Court declared that the advertisements represented that customers responding to the BLiNG Advertisements were purchasing a one-off service (such as one ringtone, wallpaper or game) when in fact they were signing up to a subscription service with a subscription fee of between $4-8 per week.

In addition, the Court declared that the respondent both misrepresented that the ringtones were sounds of original recordings of well known songs when in fact they were merely reproductions, and failed to clearly and prominently bring to the attention of customers that to end the subscription, they must text ‘stop’ to the content provider.

While we are still yet to see how the presence of the new premium mobile services industry code translates into tighter regulation of the MPS industry, this case serves as a useful reminder to advertisers that misleading and deceptive behaviour is based on the overall impression of the advertisement, and that while a disclaimer may address the issues alleged to be misleading, it must be sufficiently prominent that ordinary readers will notice it.

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