Case stems from difference in US, foreign LTE bandwidths

The Australian newspaper, in a very brief item, notes that Apple has agreed to pay a fine to the Australian Competition and Consumer Commission (ACCC) of over $2.25 million (about $2.22 million US) and admit that its advertising of the latest iPad as having LTE compatibility in Australia was deceptive. While the new iPad is compatible with North American LTE networks, most other countries that have LTE use a different frequency that is not compatible.

From the get-go, the issue arose not from any intent to deceive buyers but Apple's obsessive interest in standardizing its advertising message. The 2012 iPad was unveiled worldwide as being called "iPad with Wi-Fi and 4G LTE" despite the fact that the LTE worked only in the US and Canada.

Pressure from Australia and eventually several other countries led Apple to begin changing the name of the product and the advertising of it on its websites, carrying clearer disclaimers that the LTE was not compatible in some regions and referring to the LTE version as the iPad "with Wi-Fi and Cellular" that was compatible with "ultrafast wireless networks."

When the new iPad arrived in Australia, local vendors had almost immediately avoided any advertising material that referred to the 4G capability. Apple eventually began giving refunds to customers who were disappointed by the lack of Australian LTE compatibility.

The tipping point that led to a failure of talks between Apple and ACCC was the refusal of Australia to relax its standards of what it refers to as "4G" networks. In the US, alternate faster-than-standard-3G networks such as WiMAX and HSPA+ are also allowed to be called "4G" even though neither actually meets the standard definition.

Interestingly, it appears that Apple conceded to the name change and website marketing changes in order to avoid having a sticker placed on the packages by the authorities, one of the penalties ACCC was threatening. The company is well-known for its strong aversion to stickers or other additional markings on its carefully-designed packaging.

The company has since changed the branding in Australia and throughout the EU to clarify that the new iPad is not compatible with LTE networks outside North America but can connect to HSPA+ networks in countries that offer that option. It is not yet known if Apple will face fines in other regions where it originally advertised the iPad as "4G LTE" compatible before making its changes

It is expected that next year's iPad will feature a more advanced LTE chipset that can access LTE networks in at least some other countries without sacrificing excessive battery life, a factor that has limited "4G" advantages on Android devices. Qualcomm, a primary supplier, has announced a new radio that can access up to seven different LTE frequencies.

by MacNN Staff