FTC WARNS CONSUMERS ABOUT ‘UNLIMITED’ PLANS


Consumers are being warned to be particularly vigilant when the word ‘unlimited’ is used in advertisements; and are encouraged to obtain full information from their telecommunications service providers on the details of calling plans prior to purchase.

The Fair Trading Commission (FTC), having received several complaints regarding restrictions placed on unlimited calling plans by telecommunication service providers, will be investigating those complaints pursuant to section 37 of the Fair Competition Act that deals with misleading advertising.  In particular, the FTC will be treating advertisements promoting calling plans which are capped or otherwise qualified, and which are referred to as ‘unlimited’ or any other word which may convey a similar meaning, as being misleading or likely to mislead the public. These complaints will be vigorously pursued as breaches of the Fair Competition Act.

The complaints from the public concern the unlimited calling, text and data plans being advertised by telecommunications service providers. Consumers are induced by the advertised offerings of “unlimited” as they believe that upon purchase, they will gain the use of unrestricted calling for the duration of their plan.  Specifically, consumers believe that “unlimited” is used by the telecommunications service providers in its ordinary and usual meaning of “not limited or restricted in terms of number, quantity, or extent”.  However, while using these plans, consumers discover that the unlimited calling plans are capped and that they are prohibited from making calls even though the plans have not yet expired. Based on the complaints, consumers become aware of the restrictions only after the restrictions are effected.