Slingshot admits misleading consumers
17 May 2005
Slingshot admits misleading consumers with advertising campaign
Internet service provider Slingshot has accepted, in a settlement with the Commerce Commission, that its most recent television advertising campaign was liable to mislead consumers.
The Commerce Commission received complaints that there were conditions attached to Slingshot's unlimited dial-up internet plans from $9.95 offer which were unreadable in its television advertising. These conditions meant that consumers could never get unlimited dial-up for $9.95. In fact, consumers had to sign up to Slingshot's Anytime10 Plan which required an additional $10 per month on toll calls. The advertisement aired nationally 356 times between October 2004 and February 2005.
Following an investigation by the Commission, Slingshot modified the advertising in February by increasing the size of the graphics showing the conditions, but accepted that the modified advertisement may still have breached the Fair Trading Act.
"In the settlement, Slingshot accepted that the original advertisement breached the Fair Trading Act," said Deborah Battell, Director of the Fair Trading Branch of the Commission.
"The headline cost of $9.95 was simply not available to consumers. In fact consumers had to pay a minimum of $19.95 per month.
"Ensuring that consumers are accurately informed about the total cost of a service or good is a priority for the Commission. Slingshot's advertisements were a graphic illustration of the importance of this. The fact is that consumers have to pay twice the headline rate if they are not already on the Anytime Plan," Ms Battell said.
Slingshot advised that they did not intend to mislead consumers and have now modified the advertisement a second time to include highly visible graphics and a voice-over to disclose the conditions.